The Department of Justice prioritizes fighting corporate fraud and other misconduct because effective pursuit of civil claims protects citizens, the government, and the nation’s economy, and because expeditious and vigorous civil enforcement provides a strong deterrent to misconduct. Holding individuals who perpetrate wrongdoing accountable, in addition to corporations or business entities, is one of the most effective ways of combatting corporate misconduct. Doing so deters future illegal activity, incentivizes changes in corporate behavior, holds the proper parties responsible for their actions, and promotes the public’s confidence in our justice system.

(1) Civil corporate investigations should focus on individuals from the inception of the corporate investigation.

By focusing on building cases against individual wrongdoers from the inception of an investigation, we accomplish multiple goals. First, we maximize our ability to ferret out the full extent of corporate misconduct. Because a corporation acts only through individuals, investigating the conduct of individuals efficiently and effectively reveals the facts and extent of any corporate misconduct. Second, a focus on individuals increases the likelihood that those with knowledge of the corporate misconduct will be identified and provide information about the individuals involved, at any level of an organization. Third, by focusing on individuals from the very beginning of an investigation, we maximize the chances that the final resolution of an investigation uncovering the misconduct will include civil allegations (or criminal charges) against not just the corporation but against culpable individuals as well.

(2) Criminal and civil attorneys handling corporate investigations should be in routine communication with each other.

Early and regular communication between civil attorneys and criminal prosecutors handling corporate fraud investigations can be crucial to the Department’s ability to effectively pursue individuals in these matters. Consultation between the Department’s civil and criminal attorneys, together with agency attorneys, permits consideration of the full range of the government’s potential remedies (including incarceration, fines, penalties, damages, restitution to victims, asset seizure, civil and criminal forfeiture, and exclusion, suspension and debarment) and promotes the most thorough and appropriate resolution in every case. That is why the Department has long recognized the importance of parallel development of civil and criminal proceedings. See JM 1-12.000; JM 1-12.100.

Where civil attorneys believe that an individual identified in the course of their corporate investigation should be the subject of a criminal inquiry, that matter should promptly be referred to criminal prosecutors, regardless of the current status of the civil corporate investigation. Department attorneys should also be alert for circumstances where concurrent criminal and civil investigations of individual misconduct should be pursued. Criminal and civil investigations by the FBI or other investigative agencies should be carried out concurrently, including investigations as to the extent of the government’s damage. Care should be taken to use grand jury materials in connection with civil actions pursuant to Fed. R. Crim. P. 6(e). See United States v. Sells Engineering, Inc., 463 U.S. 418 (1983); see also 18 U.S.C. § 3322 (permitting disclosure of grand jury materials to government attorneys pursuing FIRREA civil penalty actions). Similarly, care should be taken to use the fruits of Civil Investigative Demands only as permitted by the authorizing statute, e.g., 31 U.S.C. § 3733, et seq.

(3) To be eligible for cooperation credit in a civil corporate case, a corporation must provide meaningful assistance to the government’s investigation. To earn maximum cooperation credit, a corporation must do a timely self-analysis and be proactive in voluntarily disclosing wrongdoing and identifying all individuals substantially involved in or responsible for the misconduct, without making the government compel such disclosures with subpoenas or other investigative demands.

Corporate cooperation in civil cases should be measured by how much meaningful assistance the corporation provides to the government. Meaningful assistance may include, for example, a corporation’s voluntary disclosure of misconduct, cooperation that allows the Department to identify a problem and secure a resolution without expending investigative resources that otherwise would be required, or assistance that enables the Department to pursue misconduct that otherwise would not be redressed.

A corporation that seeks to earn maximum cooperation credit generally should do a timely self-analysis and be proactive in voluntarily disclosing wrongdoing and identifying all individuals substantially involved in or responsible for the misconduct, without making the government compel such disclosures with subpoenas or other investigative demands. However, in civil cases, Department attorneys may exercise their discretion in appropriate circumstances to offer some cooperation credit to a corporation that has meaningfully assisted the government’s investigation, even absent assistance that would qualify for maximum credit, if the award of some credit for cooperation serves the public interest and furthers the administration of justice. The mere submission of legally required information, by itself, generally does not constitute meaningful assistance. Nor will the Department award any credit to a corporation that conceals involvement in the misconduct by members of senior management or the board of directors, or otherwise demonstrates a lack of good faith in its representations regarding the nature or scope of the misconduct.

The extent of the cooperation credit earned will depend on all the various factors that have traditionally applied in making this assessment (e.g., the timeliness of the cooperation, the diligence, thoroughness and speed of the internal investigation, and the proactive nature of the cooperation).

(4) Before finalizing a civil corporate resolution, the Department should carefully consider the liability of culpable individuals. The Department should preserve the ability to pursue civil remedies against those individuals, unless further action is not necessary or warranted to serve the public interest.

In instances where the Department reaches a resolution with a company before resolving matters with responsible individuals, Department attorneys should take care to preserve the ability to pursue the individuals. A Department attorney seeking to allow the release of civil claims related to the liability of individuals based on a corporate settlement must document the basis for the determination that further action against the individuals is not necessary or warranted, and must obtain written supervisory approval of the decision to allow the release of civil claims in the case.

Each Department component and U.S. Attorney’s Office may select the level of supervisory review to be required within that component or Office, consistent with their enforcement needs and circumstances.

(5) Corporate cases should not be resolved without a clear plan to resolve related individual cases before the statute of limitations expires and declinations as to culpable individuals in such cases must be memorialized and approved.

If the investigation of individual misconduct has not concluded by the time authorization is sought to resolve the case against the corporation, the corporate authorization memorandum should include a discussion of the potentially liable individuals, a description of the current status of the investigation regarding their conduct and the investigative work that remains to be done, and an investigative plan to bring the matter to resolution prior to the end of any statute of limitations period. If a decision is made at the conclusion of the investigation not to bring civil claims or criminal charges against culpable individuals, the reasons for that determination must be memorialized and approved by the United States Attorney or Assistant Attorney General whose office handled the investigation, or their designees.

Delays in the corporate investigation should not affect the Department’s ability to pursue potentially culpable individuals. While every effort should be made to resolve a corporate matter within the statutorily allotted time, and tolling agreements should be the rare exception, in situations where it is anticipated that a tolling agreement is nevertheless unavoidable and necessary, all efforts should be made either to resolve the matter against culpable individuals before the limitations period expires or to preserve the ability to charge individuals by tolling the limitations periods.

[updated November 2018]