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Yates Defends The “Yates” Memo

Sally Yates, during her confirmation hearing before the Senate Judiciary Committee to be Deputy Attorney General at the U.S. Department of Justice.  March 24, 2015.  Photo by Diego M. Radzinschi/THE NATIONAL LAW JOURNAL.

As highlighted in this prior post, in September 2015 the DOJ released this memo authored by DOJ Deputy Attorney General Sally Yates titled “Individual Accountability for Corporate Wrongdoing” (the so-called “Yates” Memo).

The “Yates” Memo was met with mounds of criticism including from former high-ranking DOJ officials. Against this backdrop Yates, not surprisingly defended her namesake memo.

The latest defense occurred last week as Yates delivered this speech at the New York City Bar Association White Collar Crime Conference.  Yates focused her remarks on “why we did it and how it’s working so far in practice.”

Her remarks focused on individually accountability, cooperation, and how the Yates Memo is working in practice. As to this later issue, Yates, not surprisingly, stated that the memo is “causing positive change within companies.” This claim of course is difficult, if not impossible, to verify empirically.

Yates also touched upon the DOJ’s recent FCPA “Pilot Program.” (See here for the article “Grading the DOJ’s FCPA Pilot Program”).

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Weissmann Should Have Listened To His Former Self

Weissmann

A supreme irony regarding last week’s announcement by the DOJ of a “new” Foreign Corrupt Practices Act “pilot program” is that the substantive document highlighting the “pilot program” bears the signature of Andrew Weissmann (Chief of the DOJ’s Fraud Section).

As highlighted in this prior post, Weissmann assumed this position in January 2015 after being a vocal critic of various aspects of the DOJ’s FCPA enforcement program as well as corporate criminal liability principles generally.

As stated in the FCPA “pilot program” that bears his signature, the goal of the program is the following:

“The principal goal of this program is to promote greater accountability for individuals and companies that engage in corporate crime by motivating companies to voluntarily self-disclose FCPA-related misconduct, fully cooperate with the Fraud Section, and, where appropriate, remediate flaws in their controls and compliance programs. If successful, the pilot program will serve to further deter individuals and companies from engaging in FCPA violations in the first place, encourage companies to implement strong anti-corruption compliance programs to prevent and detect FCPA violations, and, consistent with the memorandum of the [Yates Memo] increase the Fraud Section’s ability to prosecute individual wrongdoers whose conduct might otherwise have gone undiscovered or been impossible to prove.”

Prior to last week’s announcement of the “pilot program,” the DOJ last Fall also announced the new position of “compliance counsel,” a development that Weissmann is widely viewed as motivating. Regarding the compliance counsel position, in this recent interview, Weissmann stated that a motivation in creating the DOJ’s new compliance counsel position was to “empower a robust compliance function within organizations. We can play a big role in fostering that development.”

Asked what he “hope[d] to accomplish in general and specifically to assist the compliance professional,” Weissmann responded: “I hope that, in seeing how seriously the Department of Justice takes compliance, we will strengthen the voice of the compliance professionals and help them get a stronger seat at the table as a key stakeholder in how businesses are run.”

Whether its the stated goal of the “pilot program” to “encourage companies to implement strong anti-corruption compliance programs to prevent and detect FCPA violations” or to best “empower a robust compliance function within organizations” and best “strenghten the voice of the compliance professional [to] help them get a strong seat at the table,” Weissmann should have listened to his former self because his former self seemed to recognize that the DOJ’s recent announcements are not the best answer to accomplish its stated goals.

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Wells Fargo Head Of Anti-Bribery & Corruption Governance Pens Open Letter To DOJ Compliance Counsel With Suggestions On How The DOJ Can Do Better

Rusch

Kudos to Jonathan Rusch (Senior V.P. and Head of Anti-Bribery & Corruption Governance at Wells Fargo) for doing something few in-house counsel would ever think of doing – penning an open letter to the DOJ for how it can do its job better.

Prior to his current position at Wells Fargo, Rusch was previously the Deputy Chief for Strategy and Policy at the DOJ Fraud Section for over 25 years.

In this “Memorandum to the Compliance Counsel, United States Department of Justice” published by the Harvard Business Law Review Online, Rusch begins his 18 page  memo to DOJ Compliance Counsel Hui Chen in pertinent part as follows.

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FCPA Insanity: Doing The Same Thing Over And Over Again And Expecting Different Results

insanity

Albert Einstein is credited with saying that insanity is “doing the same thing over and over again and expecting different results.”

You don’t need to be an Einstein to realize that the main thrust of the DOJ’s recently announced FCPA “pilot program” (that is to encourage voluntary disclosure) is nothing new.

All you need to have done over the past decade is pay attention to DOJ enforcement agency speeches because the DOJ has been saying the same thing over and over again.

As noted in this original post announcing the DOJ’s “new” “pilot program,” the DOJ’s latest attempt to encourage voluntary disclosure should most certainly be seen as an acknowledgement that its long-standing efforts have not been as successful as the DOJ might hope.

Does the DOJ honestly believe that this most recent iteration is going to lead to any different results – particularly since (as will be explored in a future post) the “pilot program” really does not represent anything new despite the DOJ’s best effort to convince the corporate community otherwise?

Set forth below are numerous DOJ speeches since 2005 to encourage voluntary disclosure, including the DOJ’s repeated assurances that voluntary disclosure results in meaningful credit.

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What You Need To Know About The DOJ’s “New” FCPA “Pilot Program”

Need to know

This previous post first reported the DOJ’s announcement of a “new” Foreign Corrupt Practices Act “pilot program” and contained a general observation regarding the announcement.

Future posts will continue to analyze and provide commentary on the “pilot program.”

This post accepts the “pilot program” for what it is and sets forth in Q&A format, based on the DOJ’s own information, what you need to know about the program.

The user-friently Q&A is published as a courtesy to the legal and compliance community.

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