On December 17, 2007, U.S. Representative Bill Pascrell, Jr. (D) of New Jersey submitted to the House Judiciary Committee and to Attorney General Mukasey a “Statement of Principles on Deferred Prosecution Agreements” calling for reform and oversight of the practices surrounding such agreements. Rep. Pascrell noted the increased frequency with which federal prosecutors have used deferred prosecution agreements (“DPAs”) to punish corporate offenders and acknowledged that “these agreements serve a necessary purpose of keeping intact large corporations while making them abide by stringent reforms.”
Nevertheless, the Congressman called for the Justice Department to issue written guidelines for DPAs; for judicial approval of the terms of a DPA and quarterly reports to the court by any federal monitor put in place to ensure compliance with the terms of the DPA; for selection of federal monitors by the Executive Office of U.S. Attorneys, with approval by the district court, rather than by individual U.S. Attorneys; and full disclosure of the terms of all DPAs and of all contracts entered into by firms serving as federal monitors. A copy of the Representative’s proposal can be found on his website at www.pascrell.house.gov.
Rep. Pascrell explained that his actions were precipitated in part by a set of four DPAs filed on September 27, 2007, along with a non-prosecution agreement, by Christopher Christie, the U.S. Attorney for New Jersey. All five companies agreed to hire federal monitors selected by Mr. Christie, including a very lucrative contract with the management consulting group and law firm of former Attorney General John Ashcroft. Although not mentioned by Rep. Pascrell, all five agreements with the U.S. Attorney’s Office were notable in that the companies in question not only did not admit any wrongdoing in those agreements, but they affirmatively denied any illegality, notwithstanding their payment of hefty fines. On January 10, 2008, the New York Times reported that the contract with Aschcroft’s firms had prompted a Justice Department internal inquiry into the procedures for selecting such monitors and was likely to result in formal Departmental guidelines to prevent the appearance of conflicts in the selection process.
On January 22, 2008, another New Jersey Congressman, Frank Pallone, Jr. (D) filed legislation calling for judicial and Justice Department oversight of DPAs.