US Justice Department Publishes Guidelines for Corporate Compliance Cases
02 May 2019

The US Justice Department on Tuesday updated its guidelines for federal prosecutors considering criminal charges against financial institutions and other corporations that have failed to meet compliance obligations.

The guidance, which applies to the whole of the department’s Criminal Division, builds on 2017 guidelines for its Fraud Section and asks prosecutors to consider three fundamental questions when evaluating a company: is the compliance program well-designed, is the program effectively implemented and does it actually work in practice?

Prosecutors should consider a host of factors, including the methodology underpinning a company’s risk management process, how a firm allocates its resources, whether its training programs are tailored to trainees’ subject-matter expertise and how senior management has encouraged or discouraged compliance efforts, the department said.

The guidelines separately call on federal attorneys to evaluate the processes corporations have in place to discipline employees as well whether compliance programs have the capacity to evolve to address changing risks.

The updated guidance comes as part of a broader effort by the Justice Department to improve “training, hiring and enforcement to help promote corporate behaviors that benefit the American public,” according to a statement.

“Because a corporate compliance program must be evaluated in the specific context of a criminal investigation, the department does not use any rigid formula to assess the effectiveness of corporate compliance programs,” said Assistant Attorney General Brian Benczkowski, in a speech Tuesday. “We recognize that each company’s risk profile and solutions to reduce its risk warrant particularized evaluation.”

In recent weeks, the Justice Department and various US and UK regulators have announced global settlements for sanctions compliance failures at UniCredit Group and Standard Chartered Bank. The settlements levied an aggregate $2.4 billion in monetary penalties and tasked the banks with a host of sanctions and anti-money laundering compliance obligations.

Read more:

Criminal Division Announces Publication of Guidance on Evaluating Corporate Compliance Programs

Closer Look: Standard Chartered’s $1.1 Billion Settlement

UniCredit to Pay $1.3 Billion, Plead Guilty to US Sanctions Violations

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