Justice Department Considering Guidance On Companies ‘Inability-To-Pay’ Claims (#GotBitcoin?)

The department may issue guidance that prosecutors can use when companies claim they are unable to pay a proposed criminal fine. Justice Department Considering Guidance On Companies ‘Inability-To-Pay’ Claims (#GotBitcoin?)

The U.S. Justice Department may issue guidance for federal prosecutors to use when companies claim they are unable to pay a proposed criminal fine, a senior official said Thursday.

Companies sometimes say they are unable to pay a fine during the final stages of a government investigation, as they are negotiating a settlement agreement with prosecutors.

There are few guidelines for resolving such claims, Matthew Miner, a deputy assistant attorney general in the Justice Department’s criminal division, said in prepared remarks delivered at a conference in Houston.

The department is considering ways it can provide its lawyers with better guidance for evaluating inability-to-pay arguments, he added.

Mr. Miner said the potential guidance was part of a broader effort to identify areas in which the Justice Department could provide greater clarity to companies.

Mr. Miner’s remarks focused on some of the recent policy reforms to the department’s economic crime and corporate enforcement programs under the Trump administration.

Miner said the reforms were designed to incentivize companies to prevent crime before it happens. For example, a policy on how the department evaluates corporate compliance programs was intended to help compliance officers convince management to invest in such programs, Mr. Miner said.

Sensitive negotiations around criminal settlements rarely spill into the public view. But in at least one case, involving Brazilian conglomerate Odebrecht SA, the Justice Department appeared to accept the argument that a company was unable to pay the entire sum of a criminal fine.

In the case of Odebrecht, prosecutors and the company agreed the appropriate criminal fine for its misconduct was $4.5 billion, to be split between the U.S., Brazil and Swiss governments. But prosecutors agreed the fine was subject to an inability-to-pay analysis to be conducted at a later date, since Odebrecht had claimed it was only able to pay about $2.6 billion.

Separately, Mr. Miner also highlighted efforts by the Justice Department to use data analytics to boost its health care and securities fraud enforcement programs.

Trading data in the commodities or securities markets could be used to identify indicators or anomalies that can suggest manipulation or fraud, Mr. Miner said.

“As a result, we are now approaching enforcement, particularly in the commodities arena, around a data-driven approach,” he said. Justice Department Considering Guidance,

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