Alert 09.18.15
Alert
Alert
By William M. Sullivan, Jr., Nancy A. Fischer, Aaron R. Hutman,
03.06.17
On February 8, 2017, the U.S. Department of Justice (DOJ) released a list of important topics and sample questions that the Criminal Division’s Fraud Section has frequently found relevant in evaluating the adequacy of a corporate compliance program. Drawing from a collection of existing compliance resources, the new guidance is intended to assist ethics and compliance officers in crafting effective corporate compliance policies and procedures. It also sheds light on how DOJ’s new compliance expert, Hui Chen, is expected to assess a company’s compliance program.
Assessing the Effectiveness of a Corporate Compliance Program
The existence and effectiveness of a corporation’s compliance program and the extent of the company’s efforts to improve it are among the factors identified in DOJ’s corporate charging guidelines that federal prosecutors consider in investigating, charging and prosecuting corporate wrongdoing.
The topics and questions below are key areas DOJ has used to evaluate the effectiveness of a company’s compliance program. There is no one-size-fits-all program, and effectiveness will be evaluated based on the risk profile of the company.
Practical Implications for Companies and Compliance Officers
Ethics and compliance officers should immediately take note of the new DOJ guidance, as it appears to confirm the Fraud Section’s continued interest in and commitment to pursuing organizations and individuals for alleged failures to establish, monitor and properly implement effective compliance programs (for operations, third-party oversight and M&A transactions alike). A company’s investment of time and resources in corporate compliance is not only necessary to avoid potential embarrassment and penalties. It also serves as an insurance policy to protect the organization and its employees against potential allegations of criminal intent or willful ignorance.
Companies and their compliance officers may wish to align (or design) their compliance policies and procedures so that in the event of a potential government investigation, prosecutors can easily identify how the company and its employees have satisfied DOJ’s corporate compliance standards
The recently unveiled guidance follows a stream of recent federal law enforcement pronouncements focused on corporate compliance and individual accountability including DOJ’s September 9, 2015 Yates Memorandum, the Department’s April 5, 2016 pilot program for self-reporting Foreign Corrupt Practices Act violations and the summer of 2015 revision of the FCPA Guide. Thus, this guidance represents an important addition to the list of any compliance officer’s handy reference files.