“A corporate defendant’s approach to compliance is highly relevant to our enforcement decisions,” Murray stressed. “A fair resolution frequently requires an understanding of the compliance function at the time of the conduct at issue and any subsequent remedial steps that have been taken by the company.”
In her new role, Murray said she plans to take a page from a new hiring initiative that Assistant Attorney General Brian Benczkowski announced last year, focusing on the hiring of attorneys who have experience not just as prosecutors, but also those who bring compliance experience to the table. “As I meet with our litigating divisions in the coming weeks, I plan to ask what firsthand experience their corporate enforcement attorneys have not only with prosecutions, but also with in-house compliance,” Murray said.
Both the Criminal Division and the Civil Division agree that having expertise in compliance programs benefits parties who are negotiating resolutions, Murray added. After all, when compliance is presenting its compliance program, “you want the government’s lawyers to be well-versed in what’s effective, what’s practical, and what is not,” she said.
False Claims Act reform
Murray also provided some practical advice for compliance officers relating to new formal guidance announced this month by the Civil Division, which explains how companies facing False Claims Act (FCA) investigations can earn a more favorable resolution by providing meaningful assistance to the Justice Department.
“Corporate compliance personnel are at the forefront of all of these things,” Murray said. “Your work allows the company to detect misconduct early, to conduct the internal investigation, to take corrective actions, to determine that the disclosure to the government is appropriate and, if so, to cooperate with the government’s investigation.”
As stated in the new policy, which was formally included in the Justice Manual on May 7, “cooperation credit in FCA cases may be earned by voluntarily disclosing misconduct unknown to the government, cooperating in an ongoing investigation, or undertaking remedial measures in response to a violation.” Similarly, a company may also earn credit by preserving relevant documents and information beyond existing business practices or legal requirements; identifying individuals who are aware of relevant information or conduct; and facilitating review and evaluation of data or information that requires access to special or proprietary technologies.
“A corporate defendant’s approach to compliance is highly relevant to our enforcement decisions. A fair resolution frequently requires an understanding of the compliance function at the time of the conduct at issue and any subsequent remedial steps that have been taken by the company.”
Claire McCusker Murray
With that in mind, “the first thing you should do with this new guidance is to determine the extent to which that guidance mirrors the requirements of the underlying statute or regulations,” she said. Other parts of the guidance may include, for example, language suggesting obligations that go beyond what the law requires; language where the agency is recommending best practices; or some sort of middle ground, such as language that represents how the Justice Department interprets an ambiguous statute or regulation.
Where policy language mirrors the requirements of a statute or regulation, you’ll want to ensure your business practices align with those requirements. “For everything else, that’s where it gets more complicated,” Murray said. That’s where you’ll have to make a risk-based business decision about whether to follow an agency’s sub-regulatory guidance, or whether to take another lawful approach that differs from the guidance, she said.
What’s to come
Murray wrapped up her comments by providing a teaser on what might be coming down the pike from the Antitrust Division. Under its corporate leniency policy, a company that first reports its involvement in an illegal cartel can qualify for a complete pass in criminal prosecution in exchange for cooperation in an Antitrust Division investigation.
The compliance profession will be happy to hear, however, that the Antitrust Division is “looking to do more to award and incentivize good corporate citizenship,” Murray said. “The Antitrust Division is at an inflection point, and they may soon formally recognize that even a good corporate citizen with a comprehensive compliance program may nevertheless find itself implicated in a cartel investigation.”
Instead of simply crediting extraordinary compliance measures, as the Department has done in the past, “we may soon be in a position to credit robust compliance programs at the charging stage,” Murray said, even when the company was not fully successful at deterring and detecting misconduct. “So, stay tuned on this front. There’s more to come.”
Takeaways from Compliance Week 2019
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Claire McCusker Murray: Incentivizing corporate compliance at the DOJ