by Marsha Z. Gerber, Frederick Robinson, Richard Craig Smith, Matthew Spohn, and Ilana Beth Sinkin
On Wednesday September 9, 2015, the U.S. Department of Justice ("DOJ" or the "Department") issued a memorandum entitled "Individual Accountability For Corporate Wrongdoing" (the "Memo") outlining specific policy measures intended to empower U.S. prosecutors further in their pursuit of individuals alleged to be involved in corporate wrongdoing. The Memo is termed "guidance" by the Department, but nevertheless appears to set out clear directives to federal prosecutors and, as a practical matter, adds several weapons to the arsenal DOJ can use to flush out and prosecute individual wrongdoers implicated in corporate misconduct. The Memo follows criticism the DOJ has received following the recent economic crisis that it was insufficiently aggressive in prosecuting malfeasance at financial institutions.
In light of this new guidance, corporate actors and executives should be prepared to face increased scrutiny during corporate investigations, whether they involve the U.S. Foreign Corrupt Practices Act, various securities and healthcare fraud-and-abuse laws, or the False Claims Act.
Specifically, the Memo from Sally Quillian Yates, Deputy Attorney General, is addressed to the heads of every major criminal and civil investigative and enforcement agency in the U.S. government and directs that "[t]he measures described in this memo are steps that should be taken in any investigation of corporate misconduct." The six directions discussed in the Memo are:
The Memo details the DOJ's reasoning and position regarding each of the above six elements as follows:
While the Memo is characterized as guidance for the DOJ, unless there is further qualification, its strong wording and stated rationales at least initially indicate that the impact of the Memo within the Department will be such that the steps discussed will be seen as required protocol. Corporate employees and management, particularly senior management, should therefore be prepared to face markedly increased scrutiny during and following corporate investigations. In addition, corporations themselves will find it much more difficult to enter into "global" settlements that resolve their own liabilities and those of their officer, directors, and employees.
The Memo may also inform healthcare fraud investigations, which have increasingly scrutinized the individuals responsible for alleged improper practices. Illustrating this trend, in June the government announced criminal enforcement actions against 243 individuals across the country relating to $712 million in alleged fraudulent billing, making it the largest criminal healthcare fraud takedown in history.
The best protection against individual liability for corporate wrongdoing, particularly at the board and officer level, is for those individuals charged with responsibility for corporate compliance to ensure that effective programs, systems, and protocols are in place to prevent and detect wrongdoing and misuse of corporate assets in the first instance. Senior management should ensure that the following are and remain part of the company structure and process:
 Memorandum from Sally Quillian Yates, Deputy Attorney General on Individual Accountability for Corporate Wrongdoing to DOJ Prosecutors (Sept. 9, 2015) available at http://www.justice.gov/dag/file/769036/download[hereinafter "Memo"]
 This does not mean that following corporate resolution, there would not be the possibility of separate resolutions with individuals that may involve some discharge of liability if the Department were to deem that appropriate under the circumstances.
 The Memo does not address how this impacts, if at all, the Department's current position regarding requests for waiver of privilege. It remains to be seen whether the DOJ intends, under the tenets of the Memo, to reassess its current position and establish a more aggressive posture on privilege waivers than that which has been in place in the recent past.
 DOJ Press Release, Deputy Attorney General Sally Quillian Yates Delivers Remarks at New York University School of Law Announcing New Policy on Individual Liability in Matters of Corporate Wrongdoing (September 10, 2015), available at http://www.justice.gov/opa/speech/deputy-attorney-general-sally-quillian-yates-delivers-remarks-new-york-university-school.
 Memo, supra note 1 at 4.
 Of course, initially, the company should ensure that it has reasonable and risk-based compliance policies and procedures in place in all areas in which the company is regulated by law.
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