Change In Cooperation Credit Criteria

Deputy Attorney General Rod Rosenstein announced last week a change in the way cooperation credit is given to corporations in criminal cases. Rosenstein announced that the Department of Justice will allow a company to receive cooperation credit in criminal cases where the company has identified every individual who was “substantially involved in or responsible for the criminal conduct.” Under the prior DOJ policy, referred to as the Yates memo, corporations were required to turn over ALL relevant facts about individuals involved in misconduct.

The new policy will allow for partial credit in criminal cases as well. “If the company is unable to identify all relevant individuals or provide complete factual information despite its good faith efforts to cooperate fully, the organization may still be eligible for cooperation credit.” To receive credit, companies need only identify individuals “substantially involved in or responsible for the misconduct.”

Rosenstein noted that the DOJ wants corporations to focus on identifying the wrongdoers. Rosenstein also noted that it is inefficient for large corporations to identify every single employee that may be connected to the bad conduct.

The revised DOJ policy has been incorporated directly into the United States Attorneys’ Manual, now referred to as the Justice Manual, at 9-28:700 (“The Value of Cooperation”). This is a change from the recent DOJ practice of communicating new guidelines through memoranda named for their authors. The incorporation into the Justice Manual may signal a desire to give the revisions more authority.

Because “substantially involved” is not defined, corporations are left to guess what it means and DOJ staff are still given the authority to decide whether disclosures were sufficient to warrant participation. In the end, the problem with all these policies is that individuals are applying the policies. It remains to be seen whether DOJ staff will award cooperation credit for what they deem less than full disclosure.

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