Deeper Than the Headlines: How Trump Admin And Jeff Sessions Will Change Compliance

In early February of this year, I wrote an eBrief predicting the future of compliance under the new Presidential administration. My guess was that regulatory burdens would decrease. Read the e-Brief here.

In the eBrief, I wrote that the core of compliance and enforcement would probably stay the same, especially from a Department of Justice perspective. To support my view, I shared a video clip of then Senator Jeff Sessions commenting on his support of the False Claims Act during his confirmation hearing.

Now, Attorney General Jeff Sessions, seems to be continuing his message of support for compliance programs and holding individuals accountable in corporate misconduct.  On Monday, April 24, 2017, he spoke to a group of compliance officers at the Ethics and Compliance Initiative Annual Conference in Washington, D.C. He said, “This Department of Justice will continue to investigate and prosecute corporate fraud and misconduct, bribery, public corruption, organized crime, trade-secret theft, money laundering, securities fraud, government fraud, health care fraud, and Internet fraud, among others.” In healthcare at least, most organizations I have been acquainted with are trying to do the right thing. Many of them are the honest businesses and organizations trying to follow the rules, but they are in markets and industries where others are not playing by the rules. This puts the honest businesses at a competitive disadvantage. AG Sessions stated, “The Department of Justice not only has a duty to uphold the rule of law, which makes our country so great, but we also have a responsibility to protect American consumers. These laws are in place for a reason. When they are broken, it has real consequences in people’s lives. We will also enforce these laws so we can protect honest businesses. Companies that obey the law and do the right thing should not be at a disadvantage simply because their competitors choose to break the rules.”

Many in the compliance profession have been wondering if the Yates’ memo and its principles of holding individuals accountable would remain after the new Administration took over. Especially since Ms. Yates was fired after she refused to defend the new President’s travel ban. And though AG Sessions did not refer to it as the Yates’ Memo in his remarks Monday, he definitively stated the DOJ’s resolve to adhere to the principles of holding individuals accountable in corporate wrongdoing. To this point he said, “The Department of Justice will continue to emphasize the importance of holding individuals accountable for corporate misconduct. It is not merely companies, but specific individuals, who break the law. We will work closely with our law enforcement partners, both here and abroad, to bring these persons to justice.”

Now, all of us compliance professionals know it is much better to prevent such occurrences in the first place and that’s why we’re in this field. We know the value of compliance programs already but it always helps to hear the chief law enforcement official in the nation explain how important compliance programs are. Speaking of the cases the DOJ prosecutes he said, “each case we bring may be a sign that something has already gone wrong. That is what your work seeks to prevent, by building strong cultures of compliance within your companies to deter illegal and unethical conduct. We applaud those efforts. Our department would much rather have people and companies obey the law and do the right thing, so we don’t have to see them in court. So on behalf of the Department of Justice, I thank you, once again, for doing this vital work. We have done our part to reward effective compliance programs and to better understand your efforts; you have my commitment that we will continue to do so.”

He assured attendees that the DOJ considers an organization’s compliance program when making charging decisions. To this effect he concluded, “when we make charging decisions, we will continue to take into account whether companies have good compliance programs; whether they cooperate and self-disclose their wrongdoing; and whether they take suitable steps to remediate problems. For years, the Department of Justice has directed our prosecutors to consider these factors when making charging decisions. The U.S. Sentencing Guidelines also provide for substantial penalty reductions for companies that self-disclose, cooperate and accept responsibility for their misconduct. These principles will still guide our prosecutorial discretion determinations.”

Though there are still many years of the current Administration to go, these comments by AG Sessions seem to be one more indication that the need for effective compliance programs is not going by the way-side anytime soon.