As highlighted in prior posts here and here, in January the DOJ Criminal Division released a Corporate Enforcement and Voluntary Self-Disclosure Policy which “applies to all FCPA cases nationwide and all other corporate criminal matters handled by the Criminal Division.”
As discussed below, the DOJ’s expectation regarding voluntary disclosure is absurd as well as internally inconsistent.
As to the later point, query whether the DOJ has individuals capable of proof-reading to ensure that a policy document is internally consistent.
The DOJ policy states “although a company will not qualify for a presumption of a declination if aggravating circumstances are present, prosecutors may nonetheless determine that a declination is an appropriate outcome if the company demonstrates to the Criminal Division that it has met all” of three factors including the following:
- “The voluntary self-disclosure was made immediately upon the company becoming aware of the allegation of misconduct.”
Let’s pause here to analysis two words and the literal definition of these words.
First, allegation.
Allegation is defined as “a claim or assertion that someone has done something illegal or wrong, typically one made without proof.”
Second, immediate.
Immediate is defined as “occurring or done at once; instant.”
The notion that the DOJ criminal division wants or expects a company to immediately (instantly) disclose an allegation (a claim or assertion without proof) of misconduct is just plain absurd.
Even more absurd – and an issue that calls into question whether the DOJ has individuals capable of proof-reading to ensure that a policy document is internally consistent – is that the DOJ’s definition of “voluntary self-disclosure” sets forth a materially different standard than the standard described above and thus the DOJ’s expectation of voluntary disclosure is internally inconsistent.
The DOJ policy states “in evaluating self-disclosure, the Criminal Division will make a careful assessment of the circumstances of the disclosure, including the extent to which the disclosure permitted the Criminal Division to preserve and obtain evidence as part of its investigation” and that the Criminal Division will require, among other items, the following for a company to receive credit for voluntary disclosure:
- “The company discloses the conduct to the Criminal Division within a reasonably prompt time after becoming aware of the misconduct, with the burden being on the company to demonstrate timeliness.”
This standard is materially different than the standard highlighted above.
“Reasonably prompt time” is a much different standard than “immediate” and “becoming aware of the misconduct” is a much different standard than “becoming aware of the allegation of misconduct.”
