New DOJ Counsel to Focus on Corporate Compliance
The decision highlights the US government’s focus on effective compliance programs.
The US Department of Justice (DOJ) is creating a new compliance counsel position in the Criminal Division to assess the effectiveness of an entity’s compliance program and help prosecutors decide whether or how to charge an entity under investigation. Public statements from Chief of the Criminal Division’s Fraud Section Andrew Weissmann suggest that the new compliance counsel position’s purpose is to help prosecutors distinguish between effective compliance programs and “paper” programs. The compliance counsel will also provide companies with greater clarity and guidance about the DOJ’s expectations for compliance programs. The DOJ is reportedly vetting a former prosecutor with private sector compliance program experience for the new position.
The appointment of a dedicated compliance counsel expert at the DOJ underscores the importance of having a compliance program that will withstand government scrutiny. The decision also reinforces that the existence and strength of a compliance function is among the most important factors when the government decides whether and how to charge a corporation for criminal violations. As Assistant Attorney General Leslie Caldwell stated in her remarks at the Compliance Week Conference in May, “the adequacy of a compliance program is a factor when we decide how and whether to prosecute a company. The lack or insufficiency of a compliance program can have real consequences for a company when a violation of law is discovered.” This development should further encourage companies to design and implement programs that stay ahead of the curve by keeping up with government’s “best practices,” such as any that the new compliance counsel may identify and practices that Ms. Caldwell highlighted in her May remarks (e.g., updating programs as risks evolve, as opposed to simply guarding against past problems).
The DOJ’s decision also appears to support the Criminal Division’s broader goal of providing greater transparency about the government’s thinking when deciding whether to bring charges, decline charges, or pursue alternative resolutions in corporate investigations. In remarks in April, Ms. Caldwell discussed the relationship between transparency and deterring crime through a culture of strong corporate compliance. To that end, she explained that the DOJ already views plea agreements, deferred prosecution agreements, and nonprosecution agreements as setting forth expectations for corporate compliance programs. The new compliance counsel is expected to provide even greater insight into government expectations by providing specific guidance on program features and risk areas for various industries. Savvy audiences will want to review any forthcoming guidance and test features of their existing compliance programs against it to identify opportunities for any program enhancements or modifications.