Deputy Attorney General Rod Rosenstein Announces Revisions to Yates Memo

Similar documents
DOJ Releases New Memorandum on Standards and Policies for Retention of Corporate Compliance Monitors

U.S. Securities Litigation Against Non-U.S. Issuers by Non-U.S. Plaintiffs

Second Circuit Rejects Listing and Foreign-Squared Claims Under Morrison v. National Australia Bank

Dodd-Frank Whistleblower Provision

Corporate Disclosure of Government Enforcement Developments

House and Senate Pass NOL Carryback Legislation

Clearing Exemption for Inter-Affiliate Swaps

IRS Finalizes Regulations Relating to Allocations of Partnership Items Involving Partners That Are Look-Through Entities

New York State Paid Family Leave

CFTC Proposes to Amend CCO Rules

Bona Fide Hedge Exemptions for Commodity Swap Dealers

Tax Reform Bill Proposes Significant Compensation Changes

Regulated Investment Companies

Depositary Receipts Program Payments

IRS Replaces Proposed Regulations on Disguised Sale Rules and Allocation of Partnership Liabilities

New York s Highest Court Endorses Application of Separate Entity Rule to International Banks

Judicial Review of Deferred Prosecution Agreements

Corporate Reorganizations

COBRADesk Same Day Clearance

Real Estate Investment Trusts

Amendments to the New York Non-Profit Revitalization Act

Agencies Promulgate Final Regulations on Internet Gambling

SEC Exemptive Relief in Connection with Effective Date of Title VII of Dodd-Frank

Corporate Expatriation Transactions

Legislation Affecting Energy Trading: Recent Developments

Ninth Circuit Holds That Non-U.S. Issuers Can Be Liable in U.S. for Unsponsored American Depositary Receipt Facility

Reporting Requirements for Foreign Financial Accounts Including Foreign Hedge Funds and Private Equity Funds

LabCFTC Releases Primer on Virtual Currencies

IRS Releases Initial Guidance on the 2017 Amendments to the Internal Revenue Code s Limitation on Deduction for Certain Executive Compensation

Most of the provisions described below will be effective for tax years beginning after 2017.

SEC Proposes Rule Regarding Communications Involving Security- Based Swaps Entered Into Solely by Eligible Contract Participants

CFTC v. Wilson: Court Rules against CFTC in Commodities Manipulation Bench Trial

Proposed Treasury Exemption for Foreign Exchange Swaps and Forwards

Final Regulations Ease Compliance with the Loss Trafficking Rules

ERISA Fiduciary Rule. Fifth Circuit Vacates New ERISA Fiduciary Rule SUMMARY BACKGROUND. March 19, 2018

New York Department of Financial Services Addresses Use of External Consumer Data. and Information Sources in Underwriting for Life Insurance

New Disclosure Requirement for Derivatives Over Basket Positions That Are Controlled by the Counterparty

Proposed Rules Under the Investment Advisers Act

German and Austrian Merger Control

Tax Election to Treat Disposition of Stock of a Subsidiary as a Sale of Its Assets

Proposed Dodd-Frank Section 943 Rules

Hong Kong Rewrites Its Companies Ordinance

Tax Reform and State and Local Taxation

SEC and CFTC Adopt Product Definitions Under Title VII of Dodd-Frank

Proposed Regulations Would Greatly Expand Reach of ERISA Fiduciary Exposure

Corporate Expatriation Transactions

SEC Provides Relief to Security-Based Swap Dealers From Business Conduct Rules

Auction Rate Preferred Stock

Brexit: U.S. Agencies Facilitate Legacy Swap Transfers

SEC Reopens Comment Period on Proposed Rules Regarding Security-Based Swaps

CFTC Federal Register Notice

Agencies Release New FAQ on CEO Certification Requirement, Setting March 31, 2016 Deadline for Initial Submissions

Spin-Off and Listing by Introduction of Feishang Anthracite Resources Limited

Proposed Dodd-Frank Section 945 Rules

U.S. Tax Reform. Individual Taxation SUMMARY. January 8, 2018

Security-Based Swap Execution Facilities

Proposed Legislation Affecting Energy Trading

Internal Revenue Service Directive to Examiners on Equity Swaps

SEC Guidance on Reporting for U.S. Tax Reform

UK Bank Levy. Rates and Update SUMMARY. December 13, 2010

CFTC Exemptive Relief Upon Effective Date of Title VII of Dodd-Frank

Money Market Fund Regulation

Economic Substance Doctrine: New Directive for IRS Examiners and Managers

United States Withdraws from the Joint Comprehensive Plan of Action with Iran

SEC Work Plan for Consideration of IFRS Adoption

Recent CFTC Issuances

Swap Execution Facility Requirements

SEC Approves NYSE Proposal to Facilitate Listings of Companies Without a Trading History

Noncontrolling Investments in Banking Organizations

Anti-Tax Haven Measures to be Introduced in France

New SEC Staff Guidance on Shareholder Proposals

Amendments to the UK Bank Levy Regime and its Interaction with French and German Bank Levies

Implementation of Title VII of Dodd-Frank

SEC Staff Begins Taking Steps to Reform Shareholder Proposals

Proposed Assessment Rate Adjustment Guidelines for Large and Highly Complex Institutions

Judicial Deference to the IRS

In the Matter of Kenneth Cole Productions, Inc. Shareholder Litigation

Fair Pay and Safe Workplaces Executive Order Imposes New Terms for Federal Contractors

Recent Developments in New York State Tax Law Including Tax Provisions in the Recently Enacted Budget

Creditability of Foreign Taxes

OCC Issues Updated Policy for Determining the Impact of Discriminatory or Illegal Credit Practices on Community Reinvestment Act Ratings

New York State Budget

UK Controlled Foreign Company Rules and Taxation of Non-UK Branches

Court of Appeals Affirms NatWest Decisions

Property Disclosure Rules for Mining Registrants

Commercial Mortgage Modifications

Failed Bank Acquisitions

Registered Offerings of Debt Securities

IRS Issues Proposed Regulations on Qualified Opportunity Funds

FINRA Corporate Financing

CFTC Proposed Rule on Energy Markets Position Limits and Hedge Exemptions

CFTC Hearings on Energy Markets

IRS Acquiesces in Xilinx Decision but only for Pre-2003 Cases

Proposed Roadmap For IFRS Adoption

Implementing Workforce Reductions

Compensation and Corporate Governance Disclosure and Proxy Solicitation

Bank Capital Plans and Stress Tests

SEC Approves New PCAOB Auditor Reporting Standard

Joint Committee on Taxation Releases Summary of Senate Finance Committee s Tax Reform Plan

Mandatory CFIUS Filings for Foreign Investment in Specified Critical Technologies Companies

Transcription:

Deputy Attorney General Rod Rosenstein Announces Revisions to Yates Memo During a speech delivered Thursday at the International Conference on the Foreign Corrupt Practices Act ( FCPA ) in Oxon Hill, Maryland, Deputy Attorney General Rod Rosenstein announced revisions to certain of the Justice Manual s corporate enforcement policies regarding individual accountability. Those changes modify Department of Justice ( Department ) policies originally announced in a September 9, 2015 memorandum from then-deputy Attorney General Sally Yates (the Yates Memo ). The principal impact of the modifications is to amend the approach set out in the Yates Memo that [t]o be eligible for any cooperation credit, corporations must provide to the Department all relevant facts about the individuals involved in corporate misconduct. This policy was frequently considered to constitute a binary arrangement, under which any cooperation credit required identification and disclosure of all participants and partial credit was unavailable or elusive. Under the revised policy, a corporate wrongdoer will be eligible for cooperation credit if it identifies to the Department the individuals whom the company has found to be substantially involved in the misconduct. Rosenstein explained that the revisions do not reflect a reduction in the Justice Department s focus on individual culpability, but instead result from an effort to target that focus on individuals with substantial involvement in wrongdoing. According to Rosenstein, the revisions had two principal objectives: (1) streamlining the Department s focus on individuals and thereby increasing the efficiency and likely the pace of corporate investigations and Department resolutions; and (2) providing increased discretion to the Department s civil litigators both as to the scope of investigations, especially with respect to individual conduct, and to award partial cooperation credit to companies that make reasonable efforts to cooperate with Department investigations. According to Rosenstein, [u]nder our revised policy, pursuing individuals responsible for wrongdoing will be a top priority in every corporate investigation. The revised policy provides that companies may receive cooperation credit in criminal investigations by making good-faith efforts to identify individuals New York Washington, D.C. Los Angeles Palo Alto London Paris Frankfurt Brussels Tokyo Hong Kong Beijing Melbourne Sydney www.sullcrom.com

who were substantially involved in the criminal conduct, even if, despite those good-faith efforts, a company is unable to identify all relevant individuals or provide complete factual information. As set forth in the revised Justice Manual, [t]here may be circumstances where, despite its best efforts to conduct a thorough investigation, a company genuinely cannot get access to certain evidence or is legally prohibited from disclosing it to the government. Under such circumstances, the company seeking cooperation will bear the burden of explaining the restrictions it is facing to the prosecutor. Moreover, according to Rosenstein, investigations should not be delayed merely to collect information about individuals whose involvement was not substantial, and who are not likely to be prosecuted. As a result, companies should not be required to locate and report to the government every person involved in alleged misconduct in any way, regardless of their role, in order to receive cooperation credit. Further, under the revised policy, corporate cooperation credit in civil investigations is not an all-ornothing question. The revised policy seeks to restore discretion to civil litigators to provide partial cooperation credit when a company meaningfully assist[s] in the government s investigation. In civil cases, the Department will no longer require companies to identify all individual wrongdoers. Rather, according to Rosenstein, the most important aspect of the policy is that a company must identify all wrongdoing by senior officials in order to earn any credit for cooperation, and must identify every individual person who was substantially involved in or responsible for the misconduct to earn maximum credit. The revised policy also enhances civil attorneys discretion in two other key ways: (1) civil attorneys may, in corporate resolutions, negotiate civil releases for individuals who do not warrant additional investigation, and (2) civil attorneys may consider an individual s ability to pay when deciding whether to pursue a civil judgment. According to Rosenstein, these changes are intended to allow civil attorneys to focus their resources on pursuing substantial wrongdoers and increase the likelihood of recovery for civil fines and penalties. The modified policy is intended to provide more flexibility and expedition in conducting criminal investigations and negotiating their resolutions. It remains to be seen how the new policy will be implemented in practice and the effects that the policy will have on the scope, pace and outcomes of corporate and Department investigations. In that regard, it is notable that Rosenstein did not indicate in his speech how the revised policy accords with the requirement set out in Section 3.a. of the Department s FCPA Corporate Enforcement Policy (included as Section 9-45.120 of the U.S. Attorneys Manual) that [t]he company disclose[] all relevant facts known to it, including all relevant facts about all individuals involved in the violation of law. It is clear, however, that Rosenstein s remarks in announcing -2-

the new policies and corresponding changes to the Justice Manual confirm that although the Department is seeking to provide greater flexibility to prosecutors in corporate investigations, the prosecution of culpable individuals in such cases remains a top priority. * * * Copyright Sullivan & Cromwell LLP 2018-3-

ABOUT SULLIVAN & CROMWELL LLP Sullivan & Cromwell LLP is a global law firm that advises on major domestic and cross-border M&A, finance, corporate and real estate transactions, significant litigation and corporate investigations, and complex restructuring, regulatory, tax and estate planning matters. Founded in 1879, Sullivan & Cromwell LLP has more than 875 lawyers on four continents, with four offices in the United States, including its headquarters in New York, four offices in Europe, two in Australia and three in Asia. CONTACTING SULLIVAN & CROMWELL LLP This publication is provided by Sullivan & Cromwell LLP as a service to clients and colleagues. The information contained in this publication should not be construed as legal advice. Questions regarding the matters discussed in this publication may be directed to any of our lawyers listed below, or to any other Sullivan & Cromwell LLP lawyer with whom you have consulted in the past on similar matters. If you have not received this publication directly from us, you may obtain a copy of any past or future publications by sending an e-mail to SCPublications@sullcrom.com. CONTACTS New York Nicolas Bourtin +1-212-558-3920 bourtinn@sullcrom.com David H. Braff +1-212-558-4705 braffd@sullcrom.com Justin J. DeCamp +1-212-558-1688 decampj@sullcrom.com Theodore Edelman +1-212-558-3436 edelmant@sullcrom.com Nicole Friedlander +1-212-558-4332 friedlandern@sullcrom.com Robert J. Giuffra Jr. +1-212-558-3121 giuffrar@sullcrom.com Kathleen S. McArthur +1-212-558-4321 mcarthurk@sullcrom.com Sharon L. Nelles +1-212-558-4976 nelless@sullcrom.com Richard C. Pepperman II +1-212-558-3493 peppermanr@sullcrom.com Matthew J. Porpora +1-212-558-4028 porporam@sullcrom.com Kenneth M. Raisler +1-212-558-4675 raislerk@sullcrom.com Jeffrey T. Scott +1-212-558-3082 scottj@sullcrom.com Samuel W. Seymour +1-212-558-3156 seymours@sullcrom.com Alexander J. Willscher +1-212-558-4104 willschera@sullcrom.com Washington, D.C. Julia M. Jordan +1-202-956-7535 jordanjm@sullcrom.com Aisling O'Shea +1-202-956-7595 osheaa@sullcrom.com Christopher Michael Viapiano +1-202-956-6985 viapianoc@sullcrom.com Los Angeles Robert A. Sacks +1-310-712-6640 sacksr@sullcrom.com -4-

Palo Alto Brendan P. Cullen +1-650-461-5650 cullenb@sullcrom.com Laura Kabler Oswell +1-650-461-5679 oswelll@sullcrom.com London Theodore Edelman +44-20-7959-8450 edelmant@sullcrom.com -5- SC1:4816707.6A