In January 2003, Larry D. Thompson, former Deputy Attorney General, set forth in Principles of Federal Prosecution of Business Organization (January 20, 2003), a statement for federal prosecutors on whether or not to file criminal charges against business organizations.
The statement lists nine criteria that govern business prosecutorial decisions:
1. the nature and seriousness of the offense;
2. the persuasiveness of wrongdoing within the corporation;
3. the corporation’s policy of similar conduct;
4. the corporation’s timely and voluntary disclosures of wrongdoing and its willingness to cooperate in the investigation of its agents, including, if necessary, the waiver of corporate attorney-client and work-product protection;
5. the existence and adequacy of the corporation’s compliance program;
6. the corporation’s remedial actions;
7. collateral consequences including disproportionate harm to shareholders;
8. the adequacy of the prosecution of individuals responsible for the corporation’s malfeasance;
9. the adequacy of civil remedies or regulatory enforcement actions.
The risks in not cooperating may result in criminal penalties and civil fines. If an attorney conducts the investigation, the risks seem to encourage waiver of attorney-client privileged communications or work product.
The in-house attorney should disclose to employees, including the officers, that he/she represents the company, and that anything disclosed may be provided to a government entity if the company decides to waive privilege without notice.
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