United States: Obedient Companies Rewarded In New DOJ Policy Discouraging Duplicative Penalties

Lara Covington is a Partner in Holland & Knight's Washington D.C. office
Michael Hantmanis a Partner in Holland & Knight's Miami office


  • Deputy Attorney General Rod Rosenstein has announced a new U.S. Department of Justice (DOJ) policy to discourage government agencies from "piling on" duplicative corporate penalties.
  • Rosenstein signaled a desire for fairness by encouraging government agencies to reduce multiple penalties for the same conduct, which should provide corporations with greater certainty and finality in settlements.
  • Companies doing business in the U.S. should welcome the new DOJ policy and its incentives but remain guarded, as the new policy provides many exceptions for those not obeying its conditions.

A common refrain in the white collar bar is that American government agencies don't often get along and play well together. This can result in challenging issues for companies doing business in the U.S. that have run afoul of the law. They have historically faced repetitive punishment from different government agencies and departments for conduct that commonsense dictates should be punished just once.

Looking to combat this inequity, Deputy Attorney General Rod Rosenstein announced on May 9, 2018, a new policy to discourage "piling on" duplicative corporate penalties, which has now been incorporated into the U.S. Attorney's Manual (USAM) at Section 1-12.100. In his remarks, Rosenstein signaled a desire for fairness by encouraging government agencies to coordinate better efficiencies to reduce multiple penalties for the same conduct. While corporate America welcomes the new policy and its incentives, companies doing business in the U.S. shouldn't celebrate just yet. The new policy provides many exceptions for those not obeying its conditions.

In a speech given to the New York City Bar White Collar Crime Institute, Rosenstein identified the predicament global companies in highly regulated industries face being accountable to multiple regulatory bodies in their own country and abroad. He focused on the U.S. Department of Justice's (DOJ) respected reputation for fairness and questioned whether repeat punishment for identical behavior was necessary to rectify the harm done and provide adequate deterrence. In introducing the new policy, Rosenstein said he hoped companies would have greater certainty and finality in settlements while also considering the impact on innocent employees, customers and investors.

Highlights of the New Policy

Rosenstein's speech identified four key features of the new policy. The first was a reaffirmation of the principles of fairness that guides the DOJ; that is, that the government will not use its criminal enforcement authority to threaten companies or gain some other advantage unrelated to the investigation and prosecution of crimes. Though he remarked that this was not a policy change and just "a reminder of and commitment to principles of fairness and the rule of law," this language was not in the USAM until now.

The next two features involve the coordination of investigations, including the direction for different offices and components within the DOJ to coordinate with each other to achieve an equitable result and avoid disproportionate punishment, and the encouragement for prosecutors to coordinate with other federal, state, local and foreign enforcement authorities. As Rosenstein said, the notion of inter-DOJ cooperation is not new. As prior Deputy Attorney General Sally Yates wrote in 2015 in "Individual Accountability for Corporate Wrongdoing" (known as the "Yates Memo")1, there are six significant steps to ensure that corporate investigations are handled consistently across the DOJ. The Yates Memo is in the USAM at 1-12.000, and the Rosenstein policy follows it at 1-12.100. Indeed, Rosenstein's remarks detailed the ways the DOJ is already coordinating its efforts within the department and with other agencies.

Rosenstein's policy also reiterated another procedure championed by Yates; namely, a focus on the prosecution of individual persons. The Yates Memo laid out a policy linking cooperation credit for corporations to their willingness to hold individuals accountable for their behavior. In his remarks, Rosenstein repeated the DOJ's commitment to that policy. He questioned the deterrent effect of corporate settlements on individual actors and said the DOJ's goal in every case should be to "make the next violation less likely to occur by punishing individual wrongdoers."

The last, and arguably most interesting feature, is a set of four factors for DOJ attorneys to evaluate in determining whether multiple penalties serve the interests of justice. Those factors are: a) the egregiousness of a company's misconduct; b) statutory mandates regarding penalties, fines and/or forfeitures; c) the risk of unwarranted delay in achieving a final resolution; and d) the adequacy and timeliness of a company's disclosures and its cooperation with the DOJ, separate from any such disclosures and cooperation with other relevant enforcement authorities.

These four factors operate as exceptions to the policy against piling on. For example, a company that discovers egregious Foreign Corrupt Practices Act (FCPA) violations spanning multiple jurisdictions may still be subject to large fines and penalties in those other jurisdictions. The seriousness of the violation is something a company has little control over, however. The most interesting factor is thus the last. Any company that does not meet the DOJ's standard for adequate or sufficient disclosure faces multiple penalties for discovered violations.

Conclusion and Considerations

The DOJ's new policy, therefore, complements and bolsters the revised FCPA Corporate Enforcement Policy that Rosenstein announced in November 2017 (USAM 9-47.120). (See Holland & Knight's alert, "DOJ Makes Permanent Its Program to Incentivize Self-Disclosure in FCPA Investigations," Nov. 29, 2017.) Under that policy, companies receive discounts from potential penalty amounts based on the adequacy of their voluntary self-disclosure, cooperation and remediation.2 Voluntary self-disclosure earns a company the greatest possible penalty discount. Thus, to the extent a company fails to adequately and timely disclose a violation, it loses its chance to receive the maximum penalty discount and also faces penalties from multiple stakeholders. As Rosenstein said, "To reduce white collar crime, we need to encourage companies to report suspected wrongdoing to law enforcement and to resolve liability expeditiously."

Of course, the new policy applies to all cases, not just FCPA violations. It remains to be seen whether the disclosure and cooperation factors, which are already included in the factors used to determine whether the DOJ will pursue charges against a corporation, will be tools to strengthen the push for voluntary disclosure.

It is also important that in an era of increased foreign anti-corruption enforcement, Rosenstein appears to be reminding companies that the DOJ (and America) should come first: "Cooperating with a different agency or a foreign government is not a substitute for cooperating with the Department of Justice," he said. "And we will not look kindly on companies that come to the Department of Justice only after making inadequate disclosures to secure lenient penalties with other agencies or foreign governments. In those instances, the Department will act without hesitation to fully vindicate the interests of the United States."

Though the new DOJ policy endeavors to end a perceived unfairness in how criminal penalties are levied, it does so with many strings and conditions attached, and thus should be celebrated guardedly by corporate America.


1. Rosenstein disfavors DOJ policies issued by memos as "an inefficient and often ineffective method of enforcing government policies" and said he would incorporate policy guidance "formally" into the USAM. See "Deputy Attorney General Rod Rosenstein Keynote Address on Corporate Enforcement Policy," New York University School of Law Program on Corporate Compliance and Enforcement, Oct. 6, 2017.

2. A company that voluntarily self-discloses, fully cooperates, and timely and appropriately remediates can receive a 50 percent reduction off of the low end of the U.S. Sentencing Guidelines (U.S.S.G.) fine range (unless it is a recidivist) and generally will not require a monitor (if it has an effective compliance program). If the company does not voluntarily disclose, but fully cooperates and timely and appropriately remediates, it can receive a 25 percent reduction. The definitions and assessment factors for the terms voluntary self-disclosure, full cooperation, and timely and appropriate remediation are spelled out in the FCPA Corporate Enforcement Policy.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Sign Up
Gain free access to lawyers expertise from more than 250 countries.
Email Address
Company Name
Confirm Password
Mondaq Newsalert
Select Topics
Select Regions
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions