In the FCPA area we all know how important it is to have effective compliance programs. The DOJ’s Criminal Division and the SEC have emphasized that these programs need to be diligent, and not mere formalities. Moreover, we know that programs count to the enforcers, so we have a reason to listen to them. The FCPA Guidance tells us this, and declinations such as Morgan Stanley demonstrate it.
But have you looked at what happens in the antitrust area? It is almost as if the Antitrust Division were part of a different government. Division spokespersons have referred to any program that doesn’t prevent a violation or result in a company’s being first to disclose as “failed.” The Antitrust Division has a carve out in the U.S. Attorneys Manual explaining that it will not give credit for compliance programs. The word from practitioners is that antitrust enforcers will not even discuss a company’s compliance program. And companies that admit their crimes and enter the leniency program do not need to have or institute a compliance program. The Antitrust Division says it wants companies to have programs, but its actions have proved it did not care.
But recently an Antitrust Division official, Brent Snyder, gave a talk that went into some detail about what should be in compliance programs and suggested that the Division is beginning to take the subject more seriously. For example, he said the Division is considering giving companies credit for instituting programs after they are caught. Of course, this is odd policy: don’t consider any compliance diligence before something goes wrong, but reward those who wait until after they are caught.
The Snyder speech deserves close scrutiny. For example, the speech seems to suggest the Antitrust Division is no different in its approach from the rest of the Department of Justice, but he does not purport to revoke the special exception for Antitrust cases built into the U.S. Attorneys Manual. He also continues to indicate the Division will not do what the Criminal Division does, and consider compliance programs for the range of decisions made by prosecutors in determining how to proceed.
For those interested, I have written a detailed analysis of the speech. You can read it here (pdf).
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Joe Murphy, pictured above, is a Certified Compliance and Ethics Professional and author of 501 Ideas for Your Compliance and Ethics Program: Lessons from 30 Years of Practice (SCCE; 2008). He was co-founder and vice-chairman of the board of Integrity Interactive Corporation (now part of SAI Global). He serves on the board of the Society of Corporate Compliance and Ethics (SCCE). He can be contacted here.
1 Comment
The whole compliance profession could be positively effected by the kind of positive, probing dialog with the DOJ that Joe Murphy is calling for concerning compliance programs.
Readers may not know that outside of the FCPA area, the DOJ does not require most prosecutors to understand compliance programs, a counterproductive policy that Murphy, the RAND Center and a 100-page report of the ERC have previously analyzed in depth. https://fcpablog.com/blog/2014/6/10/memo-to-feds-tell-us-about-perps-compliance-programs.html
Murphy does a public service to focus on the achievement of Anti-Trust Chief, Brett Snyder's leadership in announcing a change of approach and doing so before the International Chamber of Commerce. COs and especially former DOJ/SEC/USAGs, should come forth now to support this new dialog.
Murphy's article is a model of suggestions and hard questions for how we can come together to protect companies and the public. As Murphy writes: "No government can ever be as effective in this battle as can the internal champions of ethics and compliance, if the government supports those efforts." (p. 15) Indeed so.
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