Anticipated Major Corporate Money Laundering Settlements on Horizon, Says DOJ Official

As Kenneth Polite, the outgoing head of the U.S. Department of Justice’s Criminal Division, prepares to step down from his role, he has disclosed that significant corporate money laundering settlements are on the horizon in U.S. courts.

In an interview, Polite revealed that a series of major corporate settlements are in the pipeline, with resolutions expected in the near future. He noted that the progress of some investigations may have been impacted by the COVID-19 pandemic.

These anticipated resolutions often involve substantial fines that companies agree to pay in order to settle criminal charges related to foreign bribery or money laundering. Notably, in the year 2022, the DOJ was involved in seven global resolutions of this nature, resulting in a total of $2.14 billion in penalties. Companies like Glencore and Honeywell International were among those that entered into global settlements in that year.

Polite, who has been in his position since July 2021, will soon join a law firm after his resignation as Assistant Attorney General for the Criminal Division. He mentioned that recent corporate investigations overseen by the DOJ have delved into "much larger schemes and activities."

Some of these global resolutions have marked significant milestones, including collaborations with countries that partnered with the DOJ for the first time. Notably, a joint resolution in December 2022 with South Africa and Switzerland marked a breakthrough in resolving foreign bribery charges against Swiss digital technologies company ABB.

Polite emphasized the likelihood of continued innovation and groundbreaking initiatives in upcoming resolutions. Under his leadership, the Criminal Division handled investigations spanning a wide range of issues, from gun trafficking and human smuggling to ransomware attacks and financial fraud.

One notable policy change introduced under Polite's guidance involves a pilot program designed to encourage cooperation and corporate compliance. The program allows the DOJ to reduce corporate fines if companies agree to "claw back" compensation from individual wrongdoers. This initiative is indicative of broader efforts aimed at improving corporate misconduct oversight and collaboration with the government.

Polite's imminent move to law firm Sidley Austin as a partner in its white-collar defense and investigations practice is expected to have a significant impact. Kristin Graham Koehler, managing partner at Sidley Austin, highlighted Polite's influence on the firm's clients, particularly in evaluating and potentially amending existing clawback policies in light of evolving DOJ strategies. Polite's insights and experience are poised to be instrumental in guiding clients through the intricacies of the department's new policies and expectations.

By fLEXI tEAM