The Department of Justice's Yates Memo - Is It Now a Case of the Corporation versus Its Executives
4 Pages Posted: 23 Oct 2015
Date Written: October 21, 2015
Abstract
The current presidential campaign has reiterated complaints that the press and politicians have made for years – and which were especially heated during the 2007-2010 financial crisis attributed at least in part to the high risk financial products and corporate willingness to look the other way for the benefit of the bottom line (at least in the short term). These complaints are to the effect that the U.S. Department of Justice (the “DOJ”) has investigated and held corporations liable for their actions – but corporations cannot act except through individuals. No senior executive was criminally convicted as a result of the misdisclosures and arguably fraudulent behavior for which corporations were found responsible. Congressional response included the 2,400 page Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010.
Even before the 2007-2010 financial crisis, and even before the Sarbanes-Oxley Act of 2002, the DOJ had established guidelines for deciding when to seek an indictment of a corporation. It will be interesting to see how the DOJ enforcement based on the Yates Memo plays out in the ongoing Volkswagen emissions saga.
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