United States: DOJ Increases Certainty for Companies Disclosing Wrongdoing

In brief

The US Department of Justice (DOJ) issued a new Corporate Enforcement and Voluntary Disclosure Policy (CEP) on March 10, 2026, establishing uniform nationwide standards for determining when to grant leniency to companies that assist in government investigations of corporate crimes. Companies that meet specified criteria are eligible for a declination of criminal charges; companies that fall slightly short of those criteria may receive a non-prosecution agreement; and companies that satisfy neither standard may be eligible for a fine reduction. Companies considering whether to self-report misconduct should consult counsel and carefully consider the criteria, because the CEP’s relatively straightforward language is modified by an appendix detailing various factors DOJ evaluates in determining whether the self-report qualifies as a “Voluntary Self-Disclosure,” whether the company's assistance constitutes “Full Cooperation,” and whether the company's remediation efforts are “Timely and Appropriate.”

This client alert summarizes the new policy and recommends action items companies should consider taking now to mitigate the risk of criminal prosecution.

Key takeaways

Under DOJ's new Corporate Enforcement and Voluntary Disclosure Policy, companies that voluntarily report corporate wrongdoing to DOJ, cooperate with the federal investigation, and remediate damage may qualify for a declination, a non-prosecution agreement, or a reduced fine. The policy applies to all DOJ components, superseding policies previously adopted by many DOJ components. It applies to all federal criminal cases with the exception of antitrust violations, which continue to be governed by DOJ Antitrust Division’s first-to-file Leniency Policy.

The universal federal corporate enforcement policy is a welcome relief from the confusion created when Department leaders announced policy changes in lengthy memoranda bearing their names and encouraged each of the Department’s headquarters divisions and 94 US Attorney’s Offices to issue independent policies. That practice left companies uncertain whether steps that would protect them from federal prosecution by one US Attorney's Office could leave them to face federal prosecution by another US Attorney's Office or a DOJ headquarters division, and whether an eponymous memorandum would continue to apply beyond the brief tenure of its author. The concise new CEP seems designed for easy incorporation into the Justice Manual, the Department’s compendium of law enforcement policies.

In more detail

Declination: DOJ will decline to file criminal charges under “Part I” of the policy if a company satisfies four requirements:

1. Makes a self-report to DOJ that qualifies as a “voluntarily self-disclosure” of misconduct.
2. “Fully cooperates” with the investigation.
3. “Timely and appropriately remediates” the misconduct.
4. No “aggravating circumstances” exist, such as egregious misconduct, pervasive misconduct, severe harm, or corporate recidivism; or aggravating circumstances exist but prosecutors recommend declination after weighing the severity of the circumstances along with the other factors.

Non-prosecution agreement: DOJ will offer a non-prosecution agreement under “Part II” if a company (1) acts in good faith by making a self-report of misconduct to DOJ; (2) “fully cooperates” with the investigation; and (3) “timely and appropriately remediates” the misconduct; but either the self-report falls short of the requirements for a “voluntary self-disclosure” under the policy, or “aggravating circumstances” warrant a criminal resolution.

The Department calls a Part II resolution a “Near Miss” and requires the company to (1) enter a non prosecution agreement, which generally involves an admission of liability but no criminal charge; (2) for a term of less than three years; (3) without an independent compliance monitor; and (4) with a penalty of 50% to 75% below the otherwise-applicable financial penalty recommended by the US Sentencing Guidelines, i.e., as little as 25% of the minimum recommended penalty.

Other cases: When a company is not eligible for a Part I or Part II resolution, DOJ retains "discretion to determine the appropriate resolution" under “Part III." If the company fully cooperates and timely and appropriated remediates the misconduct, Part III creates a presumption that the monetary penalty will involve a reduction of up to 50% off the bottom of the Sentencing Guideline range. If the company does not meet the cooperation or remediation requirement, DOJ may start from a higher point in the Sentencing Guideline range.

Definitions: The CEP includes an appendix that defines the key terms by specifying numerous factors DOJ considers in determining whether the company’s self-report qualifies as a “Voluntary Self-Disclosure,” whether its assistance constitutes “Full Cooperation,” and whether its remediation is “Timely and Appropriate.”

“Voluntary self-disclosure”: A self-report qualifies as a “voluntary self-disclosure” if a company satisfies five conditions:

1. Provides a good-faith disclosure to the appropriate DOJ component, or to the wrong DOJ component if the matter later comes to the attention of the appropriate component. It does not include a disclosure to another federal regulatory agency, a state or local government agency, or a civil enforcement agency, but such a disclosure “may qualify if appropriate under the circumstances.”
2. The misconduct was not previously known to DOJ. However, the policy provides an exception that if a whistleblower reports to both DOJ and the company, a company’s subsequent disclosure to DOJ will still qualify as voluntary self-disclosure if the company makes the disclosure within 120 days after receiving the whistleblower’s report.
3. There was no preexisting obligation to disclose the misconduct to DOJ.
4. The self-report occurs “prior to an imminent threat of disclosure or government investigation.”
5. Makes the disclosure within “a reasonably prompt time” after learning about the misconduct.

“Full cooperation”: A company receives credit for “full cooperation” if it qualifies for cooperation credit under Justice Manual § 9-28.000 and meets six conditions:

1. Discloses all relevant facts and non-privileged evidence timely, truthfully, and accurately.
2. Cooperates proactively by disclosing relevant facts even when not specifically asked to do so.
3. Preserves, collects, and discloses relevant documents and information about their provenance.
4. Identifies reasonable alternatives if foreign law restricts disclosures.
5. De-conflicts witness interviews and other internal investigative steps.
6. Makes officers, employees, and agents available for DOJ interviews.

“Timely and appropriate remediation”: Remediation is “timely and appropriate” if the company satisfies five criteria:

1. Conducts a root-cause analysis and addresses the causes.
2. Implements an effective compliance program.
3. Imposes appropriate discipline on culpable and negligent employees.
4. Retains appropriate business records.
5. Takes additional steps to demonstrate the company recognizes the seriousness of the misconduct, accepts responsibility for it, and implements measures to reduce the risk of repetition.

Conclusion: DOJ’s new Corporate Enforcement and Voluntary Disclosure Policy is a welcome replacement for inconsistent guidance about how federal prosecutors should exercise DOJ’s vast discretion to prosecute corporate wrongdoing. However, the detailed CEP criteria will not resolve all the uncertainty companies face when evaluating whether to self-report misconduct, and DOJ’s discretionary decisions generally are not subject to judicial review.

DOJ might determine that a company does not qualify for leniency. Furthermore, even when a company avoids prosecution, it may face other consequences, including an intrusive federal investigation; federal prosecution of employees; state, local, or foreign criminal prosecution; civil liability; and adverse publicity. Nonetheless, the new policy might provide some comfort to corporate executives and lawyers when deciding whether to self-report misconduct. The policy also might help promote public confidence that DOJ bases discretionary decisions about corporate prosecutions on neutral and consistent criteria.

Action steps: Companies that want to mitigate the risk of potential federal prosecution should consider taking these steps now:

1. Enhance compliance programs to facilitate internal reporting and ensure expeditious and objective review of misconduct allegations.
2. Designate outside counsel in advance and establish a protocol for independent review and investigation of credible misconduct allegations.
3. Monitor allegations and investigations regularly to identify matters that might warrant voluntary self reporting.
4. Review and update policies concerning retention of potentially relevant evidence.

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Maurice Bellan, Sumon Dantiki, Reagan R. Demas, William V. Roppolo and Jerome Tomas, Partners, and Katrina Jackson, Associate, have contributed to this legal update.