The U.S. Department of Justice, Criminal Division (DOJ) recently and unexpectedly announced changes to the manner in which it handles criminal investigations and prosecutions of white-collar and corporate cases. These changes are aimed at clarifying DOJ’s criminal enforcement priorities, increasing the efficiency with which cases are investigated and resolved, and emphasizing the benefits of voluntarily self-disclosing potential misconduct. They also signal a more business-friendly approach than in the past, and will be undoubtedly welcomed by corporations and executives alike.
DOJ’s criminal investigations and prosecutions of white-collar and corporate cases are now guided by three core tenets:
- Focus;
- Fairness; and
- Efficiency.
As such, DOJ is focusing on the “most egregious” white-collar crimes such as those involving the below, among others:
- Health care fraud;
- Program and procurement fraud;
- Corporations and individuals who:
- defraud Medicare and Medicaid;
- violate the Controlled Substances Act; and
- violate the Federal Food, Drug, and Cosmetic Act.
DOJ remains committed to holding senior-level personnel engaged in fraudulent activity accountable, along with seizing assets or proceeds related to such misconduct.
DOJ is now directing prosecutors to move expeditiously to investigate cases and make charging decisions. Additionally, prosecutors are encouraged to consider all types of resolutions including non-prosecution agreements, deferred prosecution agreements, and guilty pleas on a case-by-case basis when charges are necessary. Further, DOJ is reexamining existing agreements for early termination, and except in “exceedingly rare cases”, terms in new cases should not be longer than three (3) years. DOJ is also reassessing its use of independent compliance monitors and narrowly tailoring monitorships to “achieve the necessary goals while minimizing expense, burden, and interference with the business.”
Recognizing that “[n]ot all corporate misconduct warrants Federal criminal prosecution”, DOJ encourages corporations to identify and self-disclose potential misconduct, to cooperate with the government, and to take actions that reduce the likelihood of future misconduct. The updated Corporate Enforcement and Voluntary Self-Disclosure Policy (CEP), which now includes a flowchart, outlines three paths to resolution for disclosing parties in simple terms. The particular resolution path available to a disclosing party depends on its cooperation, timely remediation, and the existence (or not) of aggravating factors, among other considerations.
DOJ anticipates that these significant changes will promote transparency and cooperation as well as economic security interests without unduly interfering with “day-to-day business operations.” Despite a seemingly more business-oriented approach to handling white-collar investigations and prosecutions, providers are advised that combatting health care fraud remains a top DOJ priority. Therefore, providers should reevaluate their existing compliance program and remain vigilant in satisfying Federal health care program requirements.
DOJ’s Memorandum is available here.
The revised flowchart is available here.
Should you have any questions regarding the above, please contact the authors, the Garfunkel Wild attorney with whom you regularly work, or email us at [email protected].