The DOJ's New Policy Of Prosecuting Individuals

On September 9, 2015, Deputy Attorney General Sally Yates of the United States Department of Justice ("DOJ" or the "Department") issued a new policy memorandum (the "Yates Memo") entitled "Individual Accountability for Corporate Wrongdoing." This short memorandum states a series of "six key steps to strengthen [the] pursuit of individual corporate wrongdoing, some of which reflect policy shifts[.]"

The Yates Memo seems to represent a response by DOJ to public criticism that while some large financial institutions have recently been subject to significant financial penalties, few individuals at these institutions have been prosecuted. The memo apparently grew out of the efforts of a working group within the Department that considered the particular challenges involved in individual prosecutions. The Yates Memo and the recent news coverage related to it suggest that DOJ will increase its focus on the prosecution of individuals.

As background, the Yates Memo begins by describing the "substantial challenges" faced by DOJ when prosecuting individuals. The memo explains that in large corporations, "responsibility can be diffuse and decisions are made at various levels," which makes it "difficult to determine if someone possessed the knowledge and criminal intent necessary to establish their guilt beyond a reasonable doubt." The memo states that "investigators often must reconstruct what happened based on a painstaking review of corporate documents, which can number in the millions, and which may be difficult to collect due to legal restrictions."

The policies described in the Yates Memo are designed to standardize the conduct of all attorneys across DOJ and will apply to currently pending and future investigations of corporate misconduct. The United States Attorney's Manual will be revised to reflect the contents of the memo. The new standards that should be applied when conducting a corporate investigation, be it criminal or civil, are summarized below:

1. In order to receive any cooperation credit, corporations must provide the DOJ all relevant facts about the individuals responsible for illegal corporate conduct.

   The Yates Memo emphasizes that to be eligible for any credit for cooperation, the company must not only disclose all facts relating to corporate misconduct, but also identify all individuals involved in or responsible for the misconduct, regardless of their seniority or position in the company. The Department attorneys will...