Provocative DOJ Proposal Aims to Hold Financial Services Executives Criminally Liable, Even Absent Criminal Intent

22 September 2014
View Client Update

Key takeaways:

  • On September 17, 2014, Attorney General Eric Holder and Deputy Assistant Attorney General Marshall L. Miller both made speeches emphasizing the U.S. Department of Justice’s (“DOJ”) aggressive approach to seeking individual criminal convictions in high-profile white collar cases, particularly in the financial services industry.
  • Holder expressed frustration with DOJ’s inability to hold financial services executives criminally liable for alleged misconduct. He proposed several ways to make it easier for DOJ to do so, including extending the Responsible Corporate Officer doctrine, often called Park liability, to the financial services industry. Under this doctrine, an individual may be prosecuted criminally under the Food, Drug and Cosmetic Act even absent any culpable intent or knowledge of wrongdoing if he or she was in a position to have prevented the wrongdoing and failed to do so.
  • Holder’s proposal to import Park liability to financial crimes would require legislative action and is unlikely to gain traction for other reasons. Nevertheless, his statements––together with Miller’s emphasis on conditioning “cooperation credit” on companies’ efforts to provide DOJ with evidence of individual wrongdoing––demonstrate DOJ’s intensifying focus on individual prosecutions in corporate criminal cases.