In today’s robust enforcement climate, most companies have taken at least the first steps towards establishing a formal corporate compliance program. The mere existence of such a program, however, will not by itself protect a company from criminal prosecution or potential False Claims Act liability. Unless compliance programs are effectively implemented, monitored, and updated, corporate liability remains a real and frightening possibility.
In an effort to scrutinize existing corporate compliance plans, the Department of Justice recently announced its intention to hire its own compliance counsel. The new hire, who reportedly is a former federal prosecutor, will assist DOJ in its charging decisions by offering special insight into corporate compliance programs. According to Andrew Weissman, Chief of DOJ’s Criminal Division Fraud Section, the new compliance counsel will help federal prosecutors “differentiate the companies that get it and are trying to implement a good compliance program” – and as a result avoid criminal prosecution – “from the people who have a near-paper program.” In addition to aiding in charging decisions, the compliance counsel will work with companies “in a variety of different industries to make sure [DOJ] has realistic expectations” of what an effective compliance program actually entails. Mr. Weissman added, “It doesn’t do anyone good to have people wasting their compliance dollars on areas that are low risk.”
The as-yet unidentified compliance counsel is expected to focus on investigations involving the Foreign Corrupt Practices Act—which prohibits paying foreign officials to assist in obtaining or retaining business—and health care and securities fraud. We will update this post as soon as the new hire is announced and more information becomes available.