This quarterly column is written by Caral Edelberg, CPC, CPMA, CAC, CCS-P, CHC, President of Edelberg Compliance Associates, Baton Rouge, LA.
The Department of Justice (DOJ) Office of the Deputy Attorney General released a memorandum on September 9 that outlines the tough stance DOJ plans to take on individuals involved in corporate fraud. The “Individual Accountability for Corporate Wrongdoing” memorandum initiates a move toward holding individuals as well as corporations accountable for corporate misconduct and indicates that the government will take a much stronger approach to finding and punishing the individuals involved in corporate misconduct.
What does this mean for coding and billing vendors, as well as emergency medicine practices? Individuals involved in illegal billing practices may be held accountable, along with the corporations that employ them if they participated in illegal coding and/or billing practices or knew about the commission of the illegal activities. By extending accountability to individuals who knowingly participated in corporate misconduct, the DOJ hopes to increase the amount of employee participation in corporate investigations.
Investigations will require that corporations accused of misconduct identify all individuals who may have known of or participated in corporate wrongdoing. The DOJ plans to fully leverage its resources to identify culpable individuals at all levels in corporate cases. Coming from a workgroup of senior attorneys with significant experience in corporate wrongdoing, the DOJ has identified what they believe to be the most effective methods to pursue individuals, not just corporations, for corporate wrongdoing.
The DOJ will focus on six key steps to strengthen the pursuit of individual corporate wrongdoing. Some of the goals of the DOJ reflect policy shifts in order to strengthen enforcement and recoupment actions.
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In order to qualify for any cooperation credit, corporations must provide to the DOJ all relevant facts relating to the individuals responsible for the misconduct.
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Criminal and civil corporate investigations should focus on individuals from the inception of the investigation.
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Criminal and civil attorneys handling corporate investigations should be in routine communication with one another.
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Absent extraordinary circumstances or approved departmental policy, the DOJ will not release culpable individuals from civil or criminal liability when resolving a matter with a corporation.
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Department attorneys should not resolve matters with a corporation without a clear plan to resolve related individual cases, and should memorialize any declinations as to individuals in such cases.
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Civil attorneys should consistently focus on individuals as well as the company and evaluate whether to bring suit against an individual based on considerations beyond that individual’s ability to pay.
DOJ attorneys are encouraged to be proactive in investigating individuals at every step of the process, which takes place before, during, and after any corporate cooperation. Department attorneys are expected to vigorously review any information provided by companies and compare it to the results of their own investigation, in order to ensure that the information provided is complete and does not seek to minimize the behavior or role of any individual or group of individuals.
According to the memorandum, the DOJ will first maximize its ability to “ferret out the full extent of corporate misconduct.” Because a corporation only acts through individuals, according to the DOJ, investigating the conduct of individuals is the most efficient and effective way to determine the facts and extent of any corporate misconduct.
Second, by focusing their investigation on individuals, the DOJ expects to increase the likelihood that individuals with knowledge of the corporate misconduct will cooperate with the investigation and provide information against higher-ranking corporate officers.
Third, by focusing on individuals from the very beginning of an investigation, the DOJ expects to maximize the chances that the final resolution of an investigation uncovering the misconduct will include civil or criminal charges against culpable individuals as well as the corporation.
Both criminal and civil liability will survive any corporate resolution made between the DOJ and a corporation, as DOJ attorneys are expected to preserve the ability to pursue individuals. Again, the DOJ is focusing on all individuals with knowledge of or participation in corporate misconduct, in addition to the corporate entity.
Now is an opportune time to revisit internal compliance plans and activities, develop processes that encourage reporting, and address and immediately remedy potential corporate misconduct within your organization. The DOJ will take a hard stance on any policy that includes an agreement to dismiss charges against or provide immunity for individual officers or employees involved in corporate misconduct.
