Clearly feeling the sting of criticism for its failure to prosecute any individuals responsible for the financial crash, the US Department of Justice is shifting its prosecutorial priorities. No longer will the DOJ focus its fire on the corporate entity. Now, the DOJ has announced it will be targeting corporate executives for prosecution responsible for the misconduct of their companies.

This change in focus marks an important and, in some ways, predictable shift in priorities by the DOJ. Ever since the 2002 indictment of Arthur Anderson LLP in connection with the Enron Corp. scandal caused the almost immediate destruction of that firm and the resultant loss of 30,000 jobs, the DOJ has shown great reluctance to indict corporate entities. Instead, the DOJ has made extensive use of previously rare nonprosecution and deferred prosecution agreements. These agreements, which generally require an admission of corporate wrongdoing and the payment of significant financial penalties, do not carry the stigma or reputational harm of a criminal conviction. Indeed, these agreements have become so commonplace that the public, various public watchdogs and, at times, Congress have noted that, while large corporations have routinely been agreeing to NPAs and DPAs and paying the necessary fines as a cost of doing business, few if any corporate executives have been held accountable and gone to prison. Given that corporations cannot act autonomously, the fact that no individuals were being held personally accountable struck many as unfair.

The DOJ has apparently heard this outcry and has made clear that its focus has changed. Going forward, a company’s ability to avoid criminal prosecution will, in large part, hinge on whether the company can help facilitate the government’s prosecution of the employees responsible for the misconduct at issue.

In a recent speech at the Global Investigation Review Program, Principal Deputy Assistant Attorney General for the DOJ’s Criminal Division Marshall L. Miller made clear that it will no longer be sufficient for a company seeking leniency to simply make a voluntary disclosure and share with the government the substance of its internal investigation conducted by outside counsel. Going forward, Miller said, corporate cooperation will be judged in large part by whether the company has facilitated the potential prosecution of corporate executives by identifying and providing to the government evidence of criminal misconduct. Internal investigations should be focused on the identification of individual culpability. The degree and extent of a company’s cooperation with the government will, in large part, be judged by whether that cooperation clearly identifies culpable corporate wrongdoers, and by providing facts and evidence that would support a criminal prosecution of those individuals.

In his comments, Miller made clear that when outside counsel meets to discuss with the DOJ the results of its internal investigation and to plead for leniency, the first, last and primary thing the government will want to hear is about individual culpability. Simply advising the government that “mistakes were made, but have now been addressed” will not do the trick. The focus of the internal investigation must be on securing — and providing to the government — evidence of individual culpability.

Where corporate assistance in the prosecution of individuals is deemed to be lacking or, even worse, hindering, the government will no longer hesitate to bring corporate indictments. At the same time, the DOJ is now dangling the carrot of outright declinations for companies that vigorously assist the government in their effort to prosecute culpable individuals.

As Miller put it, “Voluntary disclosure of corporate misconduct does not constitute true cooperation if the company avoids identifying the individuals who are criminally responsible. Even the identification of culpable individuals is not true cooperation if the company fails to locate and provide facts and evidence at their disposal that implicate those individuals.” Where the prosecution of culpable individuals is not possible then “the government’s interest may only be vindicated by prosecuting the corporation itself.”

The government also signaled that it will view with skepticism claims that overseas privacy laws prevent the disclosure of documents or emails that the government views as critical. Should the government determine these claims to be “inaccurately expansive interpretations” of foreign law, the company will place itself at great risk of prosecution.

It remains to be seen if the government follows through with its tough talk. After all, there is a reason why the government has historically opted not to prosecute individuals: Unlike corporate entities, individuals are highly motivated to contest any criminal charges, and they are typically indemnified.

In other words, unlike corporate entities that are risk-adverse, corporate executives are not easy targets. Whether the DOJ is really willing to provide companies outright declinations — as opposed to NPAs and DPAs — where corporate executives are delivered up to the government will be closely watched by the defense bar counseling business organizations facing government scrutiny.