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Proceedings and Relevant Parties

Taking a Good Look at Bad Companies

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The Program on Corporate Compliance and Enforcement’s Conference on Corporate Crime and Financial Misdealing last April featured interdisciplinary discussion among law, business, sociology, economics, and psychology scholars. Keynote speakers Leslie Caldwell, assistant attorney general for the US Department of Justice’s Criminal Division, and Judge Jed Rakoff of the US District Court for the Southern District of New York gave attendees an in-depth view of specific issues from their respective vantage points.

Caldwell, who oversees nearly 600 attorneys prosecuting federal criminal cases across the country, focused on one of her priorities: increasing transparency about charging decisions in corporate prosecutions. Such a move, she said, benefits both the government and companies. “If companies know the benefits they are likely to receive from self-reporting or cooperating in the government’s investigation, we believe they will be more likely to come in and disclose wrongdoing and cooperate,” said Caldwell. “And on the flip side, companies can better evaluate the consequences they might face if they do not receive cooperation credit.”

Rakoff zeroed in on hybrid statutes, which establish both criminal and civil penalties for the same behavior. Such statutes, examples of which include the Sherman Antitrust Act of 1890 and the Securities Exchange Act of 1934, are inherently problematic, he argued.

While at first glance it might seem logical to give prosecutors maximum opportunity to seek both criminal and civil justice, said Rakoff, “in practice, I suggest, it leads to material inconsistencies and strange results that both undercut its effectiveness and create major legal headaches. The fundamental reason for these problems is that the legal system has long prescribed totally different rules for the interpretation of civil and criminal statutes that often make it impossible for courts to interpret hybrid civil/criminal statutes in a coherent way.”

Related Links

“Address by US Attorney General Eric Holder on Corporate Crime and Compliance”
Program on Corporate Compliance and Enforcement, 9/17/14

“Minding Other People’s Business”
NYU Law Magazine, 2014

All of 2015 Proceedings and Relevant Parties

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