DoJ backs antitrust leniency program; attorneys oppose expansion of compliance efforts PaRR
The US Department of Justice (DoJ) criminal antitrust leniency program is working well and should not be supplemented or replaced by an expansion of a program that would give sentencing credit for violators that have price-fixing compliance programs, DoJ officials and antitrust attorneys said.
“Antitrust compliance programs are only as good as the buy-in from the top,” an antitrust attorney with extensive experience at the DoJ told PaRR.
A DoJ spokesperson said that while the Antitrust Division does have a compliance credit program, it is not used often because of the number of company executives usually implicated in a price-fixing probe. “The sentencing guidelines provide that, when high-level personnel at the company participated in the cartel conduct, credit is not to be given for compliance programs,” the spokesperson said. The spokesperson said that in most cases “high-level or substantial authority personnel” are involved in any price-fixing scheme.
However, a long-time compliance officer told PaRR that the Antitrust Division should adopt an approach similar to how the DoJ’s Criminal Division enforces the Foreign Corrupt Practices Act (FCPA).
“In the anti-corruption field, they’re focused on prevention,” Joseph Murphy, an attorney with the Compliance Systems Legal Group, told PaRR. “They don’t just want to prosecute it, they want to prevent it.”
Murphy recently publicly questioned whether the DoJ’s prosecution of auto parts companies has been the success that many have said it is, adding that the cartels existed for many years before being discovered.
And even then, the conspiracy was only discovered when a company sought leniency in exchange for providing information about price-fixing. The auto parts investigation has prompted a renewed discussion of compliance programs among attorneys.
In the FCPA realm, DoJ officials push companies to operate extensive anti-bribery compliance programs in order that they may be given a more lenient sentence. Business groups have been pushing for the FCPA to be amended to allow companies to use compliance programs as a defense as the DoJ decides whether to prosecute a company or its employees.
The DoJ and the Securities and Exchange Commission last year issued extensive guidance on the FCPA that describes the hallmarks of an effective compliance program.
A second antitrust attorney with DoJ experience agreed that the Antitrust Division should expand efforts to push companies to develop compliance programs to help prevent price-fixing.
“I agree that the Antitrust Division could do a lot more to incentivize companies to have effective compliance programs,” said a second antitrust attorney with DoJ experience.
But another antitrust attorney said that expanding efforts to require extensive compliance programs would not be effective. “It’s probably true that [antitrust] prosecutors do not place as much emphasis on compliance regimes as do FCPA prosecutors, but I think the criticism is misguided,” said Hays Gorey, an attorney with GuyerGorey and a former DoJ attorney in the Antitrust and Criminal Divisions. However, he added that, “I would not be in favor of layering new compliance obligations on firms generally just because some violate the law.”
Gorey said the antitrust leniency program has achieved its goals. “The leniency program, by almost all measures, has been an enormous success leading to the discovery of vast conspiracies and the prosecution of large numbers of individuals and companies who violate the law,” he said.
And the first antitrust attorney said there would be a “tremendous outcry” if officials of a company that overcharged customers millions of dollars as a result of a price-fixing scheme received a much lighter sentence simply because it had a compliance program.
by David Baumann in Washington DC