Yates Memorandum Targeted For Change

As part of the keynote speech given at New York University’s Program on Corporate Compliance & Enforcement on October 6, 2017, Deputy Attorney General Rod J. Rosenstein strongly hinted that changes may soon be made by the Department of Justice to the Yates Memorandum. (You can read our post about the Yates Memo here). Though the speech was lacking in specifics and vague on detail, Rosenstein alluded to themes in the Yates Memo that would both back off current stances and double down on others. Themes Rosenstein loosely touched on included the DOJ’s continued resolve to hold individuals accountable for corporate wrongdoing while also stating that the government should not use criminal investigations to extract civil payments. Rosenstein was also careful to point out that any potential changes, should they be made, would reflect sentiment from individuals both inside the DOJ and in the private sector.

What this hint at potential changes could mean is still anyone’s guess at this point. However, the Internet is abuzz with educated guesses. Some believe the DOJ may change its practices to allow corporate cases to be fully resolved before moving forward with individual prosecutions or civil cases involving the corporate actors. Others feel the DOJ may move to relax the current pressure on corporations to provide information about culpable individuals within the organizations in order to qualify for “cooperation credit” that the DOJ considers when handing out punishment.

Perhaps offering a hint at the route these proposed changes may take, Rosenstein did single out other DOJ programs and policies that are also facing current review, including Foreign Corrupt Practices Act prosecutions, financial fraud policies, and corporate monitoring programs. Changes made to the Yates Memo itself or to any of the other mentioned policies, programs, or procedures signal the new administration’s focus on areas it feels need updating and oversight. These changes would also likely be welcomed by those who wish for further deregulation, especially as pertains to the controversial Yates Memo.

Although there is no exact timetable for when these changes could potentially be implemented, it is never too early for corporations, governing boards, and compliance officers and committees to begin to familiarize themselves with any new compliance requirements that they may face in the future. It is also important to point out that even if changes are made to the Yates Memo – what some folks are calling a “soft repeal” – it does not mean a green light for corporations to drop the ball on compliance, nor pursue any business strategies that could lead the corporation into trouble. With changes looming, now is a good time for corporations to revisit their compliance programs and consult with an experienced business attorney to discuss any questions or concerns related to how these changes could potentially affect them.