US DOJ highlights trends in corporate investigations

On Tuesday, November 28, 2023, Principal Associate Deputy Attorney General Marshall Miller delivered an address on corporate enforcement to the New York City Bar Association's International White Collar Crime Symposium.

Miller's speech opened with the familiar theme, also espoused by Deputy Attorney General Lisa Monaco, that "today's world demands that the Department of Justice (DOJ) expand, innovate and modernize" its corporate enforcement efforts. Miller went on to highlight three areas in which DOJ seeks to meet this challenge, by modernizing various aspects of its corporate enforcement program: (1) to address the increasing intersection between corporate crime and national and global security; (2) by targeting "the most important" and impactful white collar cases; and (3) by promoting corporate compliance.

Regarding the first, Miller noted that a "growing share" of DOJ's corporate investigations implicated national security, through terrorist financing, sanctions evasion, cybercrime, crypto-enabled crime and intellectual property theft. In response, DOJ has added more than 25 corporate crime prosecutors to its National Security Division, and increased the number of prosecutors in the Bank Integrity Unit by 40 percent.

As to the second, Miller stated that to meet DOJ's goal of targeting high profile white collar cases, it is increasingly charging "the most culpable corporate executives," and increasingly taking those cases to trial. For example, Miller noted that in 2022, the Criminal Division's Fraud Section prosecuted more individuals at trial than in any prior year. Miller also referenced recently announced charges against a founder and CEO, amounting to a multi-billion dollar monetary penalty—one of the highest in DOJ's history. Miller noted that these complex cases often require additional DOJ resources, due to corporate executives' ability to retain sophisticated defense counsel and often aggressive defensive postures. Miller said that DOJ's strategy in these complex cases is to develop modernized cross-department capabilities. As an example of this type of collaborative approach to investigations, Miller mentioned DOJ's new National Cryptocurrency Enforcement Team and Digital Asset Coordinator Network, as well as the FBI's Virtual Asset Exploitation Unit.

Third and finally, Miller discussed ways in which DOJ has promoted corporate compliance, in order to "detect and deter bad actors and discourage recidivism." These efforts include the adoption of leniency or voluntary self-disclosure policies in every DOJ component, which Monaco announced in September 2022. Miller stated that today, all 94 US Attorney's Offices have adopted consistent Voluntary Self-Disclosure policies, which aim to "identify misconduct at the earliest possible opportunity" and "incentivize corporate whistleblowing."

To learn more about these leniency provisions in greater detail, read our recent update, "US DOJ Criminal Division announces revisions to Corporate Enforcement Policy."

Miller also referenced the Criminal Division's "two-part pilot program to shift the burden of corporate misconduct away from uninvolved shareholders and onto those directly responsible." The first prong of this program is that every corporate resolution involving the Criminal Division must include a requirement that the company "develop and implement compliance-promoting criteria within its compensation and bonus systems." Second, the program allows companies to reduce their financial penalties by the amount of compensation they seek to withhold or claw back from individuals engaged in misconduct.

Miller's speech underscores the tougher approach DOJ currently employs in white collar cases, and reiterates DOJ's view that companies could benefit from self-reporting and providing meaningful information about individual wrongdoers where appropriate. Miller's speech also underscores the importance of strong and properly-enforced compliance policies and clawbacks of executive compensation in certain appropriate circumstances as a possible means of reducing financial penalties and preserving shareholder value in corporate investigations.