Yates Memo

Deputy Attorney General Sally Yates issued a sweeping and telling memo on September 9, 2015. The purpose of the Memo, issued a day after she gave new guidance to Department of Justice (DOJ) attorneys – outlining the importance of individual accountability in DOJ prosecutions, was to articulate several changes to DOJ policy, particularly regarding the definition of cooperation credit for corporations.  


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The gist of the sweeping memo was to alert prosecutors that punishment should reach those who perpetrated the fraud themselves, and not just a fine to the corporation.  This brings personal accountability and responsibility to a whole new level.

Deputy Yates wants you to know that the Justice Department is serious about accountability of bad actors and that individual accountability is real. She wants to make the marketplace a “level playing field”.

Recently, Sally Yates provided more insight into the “Yates Memo”as it has become known.  


Deputy Yates said that:

1.    The sense of ‘why’  

It was this sense of obligation that prompted us to reevaluate how the department pursues individual wrongdoing in corporate cases. As most of you know, we issued a new policy last year describing additional steps the department was taking to ensure we’re doing everything we can to hold individual wrongdoers accountable. The department has always recognized how important it was that we pursue not just corporations that break the law but also the individuals who make those crimes possible“. p2.  The purpose:

The purpose of the Memo was never to increase individual prosecutions by a certain number or percentage, or to instruct our prosecutors to bring us the heads of certain corporate executives.  From the beginning, our goal was to develop and institutionalize mechanisms to ensure that, across the department, we consistently investigate and prosecute corporate cases as effectively as possible”.

3.  The threshold of ‘how’

A common thread throughout all the policy steps is ensuring that our lawyers, both criminal and civil, are focused on individuals from the very beginning of an investigation.

First, we made clear that providing information about individual wrongdoers is a threshold requirement for any corporate cooperation – without it, no cooperation credit is available. 

Second, we changed the way that we approach civil enforcement against individuals, especially by encouraging our attorneys to pursue civil charges where warranted even if a defendant may not have full ability to pay a judgment. 

And, third, we increased the difference between the credit a corporation receives for voluntary self-disclosure and the credit it gets if the company was aware of wrongdoing but failed to cooperate until after the government came knocking. We did this by adding a 10th factor to the principles of federal prosecution of business organizations, more commonly known as the “Filip factors,” focused exclusively on the question of whether a company has or has not made a voluntary self-disclosure to the department of its potentially unlawful conduct.”

4.  The importance of self-disclosure

“By breaking out voluntary self-disclosure into a 10th, standalone factor, we are aiming to change that perception, and the reality behind it.  Now, companies that voluntarily self-disclose can be assured they will be treated differently from those that do not.  Or, put the other way round, companies that fail to self-disclose can be assured they will be treated differently from those that choose to make a disclosure.

5.  What’s in it for YOU:  “We’re placing the focus and emphasis where it needs to be.  And while that doesn’t, and shouldn’t, mean that every case will result in an indictment of the CEO, it does mean that our people are reviewing evidence against individuals up and down the corporate ladder, looking for those who may have violated the law.  And if we determine that we have a case that merits prosecution, you can be sure that we are ready to go.” 

For a recent case where the DOJ is pursuing personal liability, read more here.  


The Yates Memo Summary

When federal Prosecutors consider the appropriate punishment afforded under the law to companies that commit fraud, certain factors and credits are considered pertinent to the edict to be rendered. 

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Written by Michael Rosen, ESQ
ProviderTrust Co-Founder, mrosen@providertrust.com

Michael brings over 20 years of experience founding and leading risk mitigation businesses, receiving numerous accolades such as: Inc Magazine’s Inc 500 Award and Nashville Chamber of Commerce Small Business of the Year
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