November 7, 2023
DOJ Safe Harbor: Not Everyone’s a Fan
For many deal lawyers and other M&A participants, the DOJ’s recently announced safe harbor for voluntary disclosure of misconduct discovered in connection with an acquisition is considered a positive development. But it turns out that not everyone is a fan of the program. Here’s an excerpt from a recent Reuters article:
More than a dozen groups are pressing the U.S. Justice Department to retreat from a new policy they say gives a “free pass” to corporate wrongdoers, a sign of mounting criticism among progressives of enforcement under President Joe Biden.
Demand Progress, Public Citizen and 12 other progressive non-profit organizations and lobbying groups want Attorney General Merrick Garland and Deputy Attorney General Lisa Monaco to reverse the policy designed to coax companies to disclose misconduct they uncover during mergers and acquisitions, according to a letter sent on Friday.
The “newly announced policy will incentivize more concentration of corporate power through strategically-timed mergers or acquisitions sought in order to wipe the slate clean for lawbreakers,” the groups said in the letter.
The letter, which apparently hasn’t been made public yet, comes on the heels of a new Public Citizen report finding that despite the Biden Administration’s promises to ramp up corporate criminal enforcement, corporate prosecutions remain near record lows.
– John Jenkins