{"id":2539,"date":"2020-07-28T18:23:20","date_gmt":"2020-07-28T22:23:20","guid":{"rendered":"https:\/\/www2.law.temple.edu\/10q\/?p=2539"},"modified":"2020-07-28T18:23:20","modified_gmt":"2020-07-28T22:23:20","slug":"doj-updates-guidance-on-the-evaluation-of-corporate-compliance-programs","status":"publish","type":"post","link":"https:\/\/law.temple.edu\/10q\/doj-updates-guidance-on-the-evaluation-of-corporate-compliance-programs\/","title":{"rendered":"DOJ Updates Guidance on the Evaluation of Corporate Compliance Programs"},"content":{"rendered":"<p><span style=\"margin: 0px;font-family: 'Times New Roman',serif;font-size: 12pt\"><span style=\"color: #000000\">The Department of Justice-Criminal Division recently updated its internal guidance to federal prosecutors for evaluating corporate compliance programs. The DOJ does not promulgate a checklist or formula for evaluating such a program. Rather, in the criminal context, prosecutors are directed to evaluate, on a case-by-case basis, whether the program is well designed, is adequately resourced and empowered to work effectively, and works in practice.<\/span><\/span><\/p>\n<p><span style=\"margin: 0px;font-family: 'Times New Roman',serif;font-size: 12pt\"><span style=\"color: #000000\">\u00a0<\/span><\/span><span style=\"margin: 0px;font-family: 'Times New Roman',serif;font-size: 12pt\"><span style=\"color: #000000\">Although there were no major substantive changes from the prior, 2019 version of the guidance, the key changes to the current version highlight DOJ\u2019s continued focus on the importance of individualized risk-based compliance programs, and the fact that risks may change over time. The updated guidance encourages prosecutors to take the risk profile of a corporation, \u201cincluding its size, industry, geographic footprint, regulatory landscape, and other factors,\u201d into account when evaluating its compliance program.<\/span><\/span><\/p>\n<p><span style=\"margin: 0px;font-family: 'Times New Roman',serif;font-size: 12pt\"><span style=\"color: #000000\">The guidance includes:<\/span><\/span><\/p>\n<ul>\n<li><span style=\"color: #000000\"><span style=\"margin: 0px;font-family: 'Times New Roman',serif;font-size: 12pt\">Corporate compliance programs should be designed comprehensively for \u201cmaximum effectiveness\u201d in preventing wrongdoing by employees, and corporate management must enforce the program to prevent tacit encouragement of misconduct.<\/span><\/span><\/li>\n<li><span style=\"color: #000000\"><span style=\"margin: 0px;font-family: 'Times New Roman',serif;font-size: 12pt\">Corporate compliance programs should be effectively implemented to avoid being merely \u201cpaper programs.\u201d An effective compliance program includes \u201cthe company\u2019s culture of compliance\u201d and an \u201cawareness among employees that any criminal conduct will not be tolerated.\u201d Employees should be adequately informed of the compliance program and convinced of the corporation\u2019s commitment to it.<\/span><\/span><\/li>\n<li><span style=\"color: #000000\"><span style=\"margin: 0px;font-family: 'Times New Roman',serif;font-size: 12pt\">Corporate compliance programs should not reflect a point in time; rather, programs must be continually monitored and improved upon, taking into account internal and external data on operational effectiveness and best practices. <\/span><\/span><\/li>\n<li><span style=\"color: #000000\"><span style=\"margin: 0px;font-family: 'Times New Roman',serif;font-size: 12pt\">Corporate compliance programs should identify misconduct timely to allow for remediation and self-reporting. This is a \u201cstrong indicator\u201d that the program is effective. Compliance programs should also \u201cevolve over time to address existing and changing compliance risks,\u201d and organizations should \u201cundertake adequate and honest root cause analysis to understand both what contributed to the misconduct and the degree of remediation needed to prevent similar events in the future.\u201d<\/span><\/span><\/li>\n<\/ul>\n<p><span style=\"margin: 0px;font-family: 'Times New Roman',serif;font-size: 12pt\"><span style=\"color: #000000\">Whether federal prosecutors are conducting an investigation, prosecuting misconduct by a business organization, or determining an appropriate penalty or criminal fine, great consideration is given to whether the corporation had an adequately designed and effectively implemented program that timely identified misconduct.<\/span><\/span><\/p>\n<p><span style=\"margin: 0px;font-family: 'Times New Roman',serif;font-size: 12pt\"><span style=\"color: #000000\">\u00a0<\/span><\/span><span style=\"margin: 0px;font-family: 'Times New Roman',serif;font-size: 12pt\"><span style=\"color: #000000\">Link to full article <\/span><a href=\"https:\/\/www.ballardspahr.com\/alertspublications\/legalalerts\/2020-06-04-doj-guidance-on-the-evaluation-of-corporate-compliance-programs\">here<\/a><\/span><\/p>\n<hr \/>\n<p><i><span style=\"margin: 0px;font-family: 'Times New Roman',serif;font-size: 12pt\"><span style=\"color: #000000\">Henry E. Hockeimer, Jr. is a partner at Ballard Spahr LLP in the Philadelphia office. Hank is the Practice Leader of the firm\u2019s White Collar Defense\/Internal Investigations Group. His practice focuses on white collar criminal defense and securities fraud\/litigation. Hank represents businesses and individuals facing investigation by state and federal authorities and has represented clients in federal and state courts throughout the United States.<\/span><\/span><\/i><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Department of Justice-Criminal Division recently updated its internal guidance to federal prosecutors for evaluating corporate compliance programs. Despite the lack of major substantive changes, the updated guidance encourages prosecutors to take the risk profile of corporations into account when evaluating its compliance programs.<\/p>\n","protected":false},"author":33,"featured_media":2540,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[14,22],"tags":[1816,1817,1818,1819,291,1820,377,1821,748,1822],"coauthors":[1815],"class_list":["post-2539","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-corporate-governance","category-corporate-responsibility","tag-best-practices","tag-corporate-compliance","tag-criminal-conduct","tag-culture-of-compliance","tag-department-of-justice","tag-federal-prosecutors","tag-guidance","tag-operational-effectiveness","tag-risk","tag-self-reporting","masonry-post","generate-columns","tablet-grid-50","mobile-grid-100","grid-parent","grid-33"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.2 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>DOJ Updates Guidance on the Evaluation of Corporate Compliance Programs - The Temple 10-Q<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/law.temple.edu\/10q\/doj-updates-guidance-on-the-evaluation-of-corporate-compliance-programs\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"DOJ Updates Guidance on the Evaluation of Corporate Compliance Programs - The Temple 10-Q\" \/>\n<meta property=\"og:description\" content=\"The Department of Justice-Criminal Division recently updated its internal guidance to federal prosecutors for evaluating corporate compliance programs. 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