One of the principal responsibilities of the governing board in the context of a federal regulatory investigation is whether, and if so to what extent, it should cooperate with the government in order to demonstrate organizational good faith and reduce the prospects of defending a criminal or civil complaint. While these issues were most formally introduced in September, 2015 with the release of the Yates Memorandum, three separate September public presentations by senior Department of Justice officials shed additional light on this important governance topic.

It is well understood that the Yates Memorandum provides clear incentives for the corporation under investigation to provide the government with “all relevant facts relating to the individuals responsible for the (alleged) misconduct.” In recent comments DOJ Fraud Division Chief Andrew Weissmann warned that the government is increasingly attentive to potential self-reporting misconduct; i.e., situations where companies might make “scapegoats” of lower level employees by providing the government with evidence regarding their culpability in order to shield higher level executives from investigation. In a September 8 presentation, Principal Deputy Assistant Attorney General David Bitkower commented on the DOJ’s health care fraud enforcement activity, including its focus on corporate health care fraud, through a careful analysis of FCA lawsuits instituted by qui tam relators. Mr. Bitkower also referenced the use of benchmarking and other metrics to analyze the effectiveness of corporate compliance programs and conduct interviews of compliance personnel and other witnesses.

In addition, in a September 27 presentation, Principal Deputy Associate Attorney General Bill Baer commented on corporate cooperation in civil enforcement matters. He identified several factors that, when present, would contribute to a company meeting the threshold for cooperation credit. These include being proactive in terms providing material assistance to the government across a broad spectrum of elements; being timely in the provision of such assistance; enabling the government to pursue conduct it might not otherwise have been able to address; and an acknowledgment of responsibility, or efforts to help victims of the relevant company conduct.

Decisions relating to corporate cooperation and the form, structure and operation of the compliance plan are ultimately those of the governing board. They are decisions that should be made with the advice and recommendations of the general counsel and qualified outside white collar and compliance program legal counsel. These three new DOJ speeches are relevant to the board’s (and compliance committee’s) awareness of cooperation and compliance effectiveness issues.