Justice Department officials on Tuesday unveiled a pilot program that they hope will encourage companies to reach out to prosecutors when they find evidence their employees bribed foreign government officials.
Assistant Attorney General Leslie R. Caldwell, who heads the department’s Criminal Division, said the initiative is meant to help federal prosecutors learn of international corruption more quickly and build more cases against individuals — even if that means giving cooperating companies a break.
In some cases, Caldwell said, companies that self-report wrongdoing and surrender their ill-gotten gains will be able to avoid prosecution altogether. Others will receive financial penalties at half the level that federal guidelines call for or be allowed to forego having a federal monitor oversee their activities, she said.
Employees at the companies, however, will be squarely in federal prosecutors’ crosshairs — consistent with a recent memo from Deputy Attorney General Sally Quillian Yates reminding prosecutors in corporate matters to “maintain a focus on the responsible individuals.”
“The individuals get nothing,” Caldwell said. “If the individuals are culpable and we’re able to prosecute them, that’s what we intend to do.”
The new program is narrowly tailored to Foreign Corrupt Practices Act cases, where businesses bribe foreign government officials to gain a competitive advantage. Caldwell said it is unlikely to be expanded to U.S. financial fraud cases.
Andrew Weissmann, chief of the Justice Department’s Fraud Section, said the new guidance draws a “clear distinction” between companies that report their own wrongdoing and those that cooperate after they’re caught, and the companies that come forward unprompted will receive more benefits.
The Justice Department has beefed up its focus on foreign bribery in recent months, assigning 10 new prosecutors to work exclusively on Foreign Corrupt Practices Act cases, while the FBI has created three new squads dedicated to international corruption. The Amsterdam-based telecommunications company VimpelCom recently reached a deferred-prosecution agreement with U.S. prosecutors that required it to pay a criminal penalty of more than $230 million to the United States.
The Foreign Corrupt Practices Act has faced criticism for being unclear, and Caldwell said she hopes the new program will “increase transparency” about the Justice Department’s efforts. She said that the new guidance is “not a lenient program” — even if it means some companies might be able to avoid prosecution — and that the Justice Department will monitor it closely to see if it is encouraging companies to come forward.
Caldwell declined to comment on how the program might be impacted by the Panama Papers — leaked documents that seem to reveal a vast network of offshore accounts — other than to say, “We’re reviewing the reports that we saw.”