DOJ’s new Corporate Enforcement Program is designed to bring certainty to the voluntary disclosure and cooperation process. DOJ’s intent is clear — voluntary disclosure is likely to lead to a declination, reduced penalties and the absence of a corporate monitor.
DOJ’s changes are another attempt to spur voluntary disclosures. Over the last ten years, DOJ has step-by-step sought to increase the benefits of voluntary disclosure. This is the next logical step — a guaranteed declination, not a presumed declination. This change may seem trivial but it has significance.
Many companies have gone through the voluntary disclosure process and felt at the mercy of DOJ. DOJ holds all the cards in the cooperation context — companies have to persuade DOJ prosecutors to secure a favorable outcome. DOJ’s views are rarely overturned by District Judges.
As a result of the new DOJ whistleblower program, companies have an even greater incentive to cooperate — companies have to act quickly for fear that a whistleblower could beat them to DOJ’s door. The False Claims Act qui tam program, and the SEC’s whistleblower program have been remarkably successful. DOJ’s new whistleblower program, which began in 2024, is likely to succeed as well.
Under DOJ’s whistleblower program, if a criminal investigation is launched, the whistleblower — not the company — may earn a non-prosecution resolution. If the whistleblower reports earlier than the company, the implications are significant since the declination may not be available for the company as the second in line for benefits. To avoid this situation, DOJ is reminding companies to seriously weigh the potential benefits of a prompt self-disclosure.
As part of its new White Collar Enforcement Program, AAG Galeotti recently announced significant additions to DOJ’s corporate whistleblower program to reflect the new priorities of this Administration. These new areas include: procurement and federal program fraud; trade, tariff, and customs fraud; violations of federal immigration law; and violations involving sanctions, material support of foreign terrorist organizations, or those that facilitate cartels and TCOs, including money laundering, narcotics, and Controlled Substances Act violations.
Whistleblower tips in these areas can result in significant percentage recoveries from forfeited assets. There is an established whistleblower bar with many attorneys willing to offer legal services on contingency. The DOJ whistleblower program will mature and in the future will be a significant source of DOJ investigations and prosecutions.
The amended list confirms what we already know — DOJ is focused on tariff, sanctions and export controls enforcement, AAG Galeotti reinforced this message by specifically urging whistleblower reports and voluntary disclosures by companies in the financial industry relating to anti-money laundering and financial crimes.
DOJ’s new approach is an attempt to simplify the disclosure and cooperation alternative. By offering resolution certainty, and encouraging voluntary disclosures to the extent possible, DOJ is urging companies with the support of compliance officers to take advantage of the program to self-disclose potential violations.
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