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U.S. Attorney General Vows to Go After Individual Defendants, Cautions Defense Lawyers

Commentary by Ilan T. Graff and Steven Lofchie

In a speech before the ABA Institute on White Collar Crime, Attorney General Merrick B. Garland highlighted DOJ's "first priority in corporate criminal cases," the prosecution of individuals who profit from corporate malfeasance. Mr. Garland explained that deterrence is DOJ's aim, adding "the prospect of personal liability has an uncanny ability to focus the mind. . . . [t]hat prospect is the best deterrent to corporate crime."

To that end, Mr. Garland stated that he requested increases in the President’s FY22 budget for DOJ’s corporate criminal enforcement efforts, in particular to aid the DOJ in combatting pandemic-related fraud. The additional resources would allow DOJ to hire 120 more attorneys. He stated that the DOJ would seek to further enhance its impact by adding "force multipliers" to its prosecutors and agents.

Prosecutorial Partnerships

Mr. Garland stated that DOJ would seek to further enforcement partnerships with the Labor Department, the Treasury Department, the Small Business Administration, the United States Post Office, the SEC, the CFTC and the IRS, along with state, local, Tribal and territorial law enforcement agencies. He said that these partnerships would be "operationalized by numerous joint task forces and strike forces." He noted the recent interagency task force launched to hold Russian oligarchs and others accountable who sought to evade U.S. sanctions (see related coverage).

Use of Big Data to Identify Fraud

Mr. Garland stated that he would continue to use "big data" to identify payment anomalies indicative of fraud.

Expectations for Corporate Cooperation

Mr. Garland said that the DOJ "restored prior Department guidance making clear that, to be eligible for any cooperation credit, companies must provide the Justice Department with all non-privileged information about individuals involved in or responsible for the misconduct at issue." Speaking directly to defense counsel he warned "when we give a company the opportunity to come clean, it must come clean about everyone involved in the misconduct, at every level" and "when the Justice Department offers a company the opportunity to enter into a resolution for its misconduct, it is in that company’s best interest to provide us with a full picture of what happened and who was involved."

The Attorney General stated that he "expect[s] that our enforcement activity will only accelerate as we come out of the pandemic."

Commentary

The realities of modern federal budgeting make agency requests more an exercise in aspiration than concrete strategic planning, and the specific financial investments the Attorney General outlined are unlikely to fully materialize. But emphasis on enhanced corporate criminal enforcement was conspicuously absent from past statements on DOJ top-line funding priorities. In other words, the Attorney General’s speech is the strongest indication yet that the Department is prepared to commit resources in line with its aggressive posture on corporate wrongdoing. 

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Commentary

The suggestion that defense attorneys, whether representing legal entities or individual defendants, should serve as a "force multiplier" for the government is arguably ill-phrased. It is of course the obligation of a private attorney to represent a client honestly and within the bounds of the law. It is not the job of a private attorney to serve as a force multiplier for the government. While no doubt Mr. Garland's remarks were intended to emphasize the legal obligations of attorneys, and underscore the DOJ's recent policy changes with respect to cooperation, perhaps some clarification as to the responsibilities in regard to the second point would be in order.  

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Data Use by Regulators, Fraud
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