New guidelines laid out by the U.S. Department of Justice on (DOJ) Thursday, outlined in a memo to federal prosecutors across the United States, focus on wrongdoing by corporate executives.
The memo included that, a company would not receive any credit for cooperating during future investigations unless it disclosed all relevant facts about the people involved in suspected wrongdoing or crimes. The changes only apply to current matters to the extent it is practicable. Complex white-collar investigations frequently take years to complete.
Increasing criticism is mounting by lawmakers and the general public over the fact that the government has not investigated individual executives vigorously enough, about their conduct in the lead up to the global financial crisis.
In a statement from Robert Weissman, president of Public Citizen, the memo "amounts to a striking admission that the DOJ's policy on Wall Street corporate crime has been completely ineffective." Weissman said the real test would be whether or not prosecutors can put the policy into action.
Lower fines or less serious charges against a business itself are a result of corporations cooperating with prosecutors, something of high value to corporations. A form of this is when corporations initiate elaborate internal probes.
When a corporation is suspected of wrongdoing, they start by hiring a large law firm. Those corporate lawyers will review documents, conduct interviews and deliver findings to internal counsel. Potential evidence of wrongdoing is then forwarded to DOJ.
In a speech at New York University School of Law, Deputy Attorney General Sally Quillian Yates said that companies must be more willing to give up their own officers or employees and stop hiding crimes by corporate leader when authorities start asking questions. She said, "We're not going to let corporations plead ignorance. If they don't know who is responsible, they will need to find out."
Yates said, "No more picking and choosing what gets disclosed. No more partial credit for cooperation that doesn't include information about individuals." Cooperation with authorities is "all or nothing".
Rather than a focus solely on the wrongdoing by the company, Yates' memo added that corporate investigations would focus from the beginning on individuals.
U.S. Democratic Senator Elizabeth Warren from Massachusetts, has called for more prosecutions of Wall Street bankers.
U.S. Democratic Senator Bernie Sanders of Vermont said the U.S. government made a mistake by not "prosecuting the people responsible" for the economic crash. Sanders said in a statement, "It is not acceptable that many young people have criminal records for smoking marijuana, while the CEOs of banks whose illegal behavior helped destroy our economy do not." Sanders supports the decriminalization of marijuana possession and the legalization of medical marijuana.
Contributed by Millennium Traders