The U.S. Department of Justice (DOJ) is using a combination of carrots and sticks to encourage banks and other corporations to proactively report misconduct by their employees, while ramping up scrutiny of cryptocurrency scams, according to a senior official.
In addition to voluntary disclosure, companies would have to fully cooperate on remedial actions. The DOJ also will not require an independent compliance monitor if the company has rolled out an effective compliance program.
“When misconduct occurs, we want companies to step up and own up,” Miller said. “When companies do, they can expect to fare better in a clear and predictable way.”
To give the policy more teeth, the DOJ is pushing corporations to adopt compensation clawback measures, which financially penalize executives and other employees whose actions or omissions led to criminal conduct.
Two of ABB’s subsidiaries pleaded guilty to conspiracy to violate the U.S. Foreign Corrupt Practices Act, and the parent company entered into a three-year deferred prosecution agreement with the DOJ. ABB took active steps to report the wrongdoing to the DOJ and the Securities and Exchange Commission.
Miller also addressed the burgeoning fraud and criminal activity in the cryptocurrency sector, citing several instances of “law enforcement disruptions” where the DOJ t0ok action against scammers and ransomware actors and helped seize and recover ill-gotten digital assets.
“The department has been closely tracking the extreme volatility in the digital assets market over the past year,” he added.
Within the last year, the DOJ has created two new groups related to digital assets: the National Cryptocurrency Enforcement Team at DOJ headquarters and the Digital Assets Coordinators in the offices of all 94 U.S attorneys, Miller said.
The Federal Bureau of Investigation has also launched a new unit that will work closely with the two groups to probe illicit use of virtual assets.