Feds Vow Crackdown on Corporate Crime ‘Repeat Offenders’

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Illustration by images_of_money via Flickr.

Year-end penalties imposed against two companies, global financial services firm NatWest Markets PLC and housing contractor Balfour Beatty Communities LLC represent the first two corporate criminal resolutions the Justice Department has announced since promising to crack down on companies that are recidivists, lack ironclad compliance programs, or are slow to cooperate, reports Bloomberg News.

The move provides the first tangible signs of how the DOJ plans to approach corporate crime by pressing for more guilty pleas and imposing outside monitors and represents a shift from the Trump era, when comparable misconduct often led to deferred or non-prosecution agreements, and the use of corporate monitors sharply declined.

NatWest Markets PLC pleaded guilty to wire and securities fraud, stemming from market manipulation schemes, andr Balfour Beatty Communities LLC entered a guilty plea for defrauding three branches of the U.S. military. Deputy Attorney General Lisa Monaco instructed prosecutors to consider the “full range” of prior misconduct by a company, while rescinding previous guidance discouraging the appointment of third-party monitors that ensure firms adhere to the terms of their deal.

The Justice Department is now studying how it selects corporate monitors and whether a standardized appointment process across all divisions is necessary. Imposing monitors on Balfour Beatty and NatWest should be a clear signal to other companies, many of which oppose the use of third-party firms to ensure they adhere to the terms of a DOJ deal, arguing they’re expensive and intrusive.

Additional Reading:  IRS Investigators Identify Billions in Fraud

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