DOJ’s new compliance certification requirement seeks to “empower” CCOs.

A new policy at the U.S. Department of Justice (“DOJ”) pertaining to Foreign Corrupt Practices Act (“FCPA”)/anti-corruption compliance has recently sent shockwaves through the corporate compliance community. The change was first previewed by Assistant Attorney General (“AAG”) for the DOJ’s Criminal Division Kenneth Polite in a speech delivered on March 22, 2022: “I have asked my team to consider requiring both the Chief Executive Officer and the Chief Compliance Officer to certify at the end of the term of the agreement that the company’s compliance program is reasonably designed and implemented to detect and prevent violations of the law… and is functioning effectively,” said AAG Polite.¹ Speaking to a room full of compliance professionals, he reassured the audience that DOJ’s new certification policy is intended to “further empower” Chief Compliance Officers (“CCOs”) and ensure they “have true independence, authority, and stature within the company.” Still, the prospect of facing personal liability has many in the compliance community unsettled. The new DOJ policy, AAG Polite explained, applies to all corporate resolutions, including guilty pleas, deferred prosecution agreements (“DPAs”), and non-prosecution agreements (“NPAs”).

The Glencore Settlement: Key Takeaways.

The new DOJ policy has already been applied in one FCPA case so far: a $700 million FCPA settlement with Switzerland-based commodities giant Glencore International A.G. (“Glencore”). On May 24, the DOJ issued a press release announcing that Glencore pled guilty in the Southern District of New York to violations of the FCPA’s anti-bribery provisions and, separately, that Glencore Ltd. pled guilty in the District of Connecticut to a commodity price manipulation conspiracy.² “Together, Glencore and Glencore Ltd., both part of a multi-national commodity trading and mining firm headquartered in Switzerland, agreed to pay over $1.1 billion to resolve the [U.S.] government’s investigations,” the press release notes. The Glencore settlement is a major case, with anticipated payments of $1.5 billion in total to resolve various anti-corruption investigations from U.S., UK, and Brazilian authorities.

As with other anti-corruption settlements of similar magnitude, Glencore’s case involved years of pervasive misconduct from “high-level employees and agents of the company” acting in multiple countries. However, unlike past FCPA settlements, Glencore’s agreement contains a compliance certification signed by the CEO and CCO of Glencore.³ The terms of the agreement provide that the certification “shall constitute a material statement and representation by the undersigned and by, on behalf of, and for the benefit of, the Company to the executive branch of the United States for purposes of 18 U.S.C. § 1001,” and “shall also constitute a record, document, or tangible object in connection with a matter within the jurisdiction of a department or agency of the United States for purposes of 18 U.S.C. § 1519.” In short, both the CEO and CCO of Glencore, by signing the compliance certification, acknowledged the certification to be “material,” potentially exposing themselves to personal liability under the fraud or obstruction of justice statutes listed above.

Additional certification language may be required.

AAG Polite also noted that additional certification language may be required in certain resolutions. For instance, “[w]hen a company is required to provide annual self-reports on the state of their compliance programs, [DOJ] will consider requiring the CEO and the CCO to certify that all compliance reports submitted during the term of the resolution are true, accurate, and complete.” Moving forward, DOJ hopes its new compliance certification policy will incentivize companies to prioritize anti-corruption compliance, starting with ensuring that CCOs “receive all relevant compliance-related information and can voice any concerns they may have prior to certification.”⁴

Compliance certifications “most likely” to be incorporated into every future DOJ resolution.

On June 22, Lauren Kootman, Assistant Chief of the newly revamped Corporate Enforcement, Compliance, and Policy Unit in the DOJ’s Fraud Section, addressed the new DOJ policy at an event hosted by the Women’s White Collar Defense Association. Kootman explained that the policy is not intended “to put a target on the back of a chief compliance officer,” but rather to ensure CCOs are given “access to important information” and “have a seat at the table” where important and potentially high-risk decisions are made. Further, Kootman predicted that “certifications are going to be incorporated into every – most likely – every resolution” moving forward. Compliance professionals beware: certifications are expected to be a fixture in future corporate settlements at DOJ.