Chris Prentice
NEW YORK, Feb 5 (Reuters) – Federal prosecutors plan to increase incentives for companies that cooperate during criminal investigations, including promising not to prosecute them, the U.S. attorney in Manhattan said on Thursday.
Jay Clayton’s comments at an industry conference come as the Justice Department is scaling back its corporate crime enforcement efforts and refocusing on immigration and drug cases under the Trump administration.
Clayton told the New York Securities Enforcement Forum that companies need to know there are concrete benefits to working with U.S. prosecutors to root out bad actors.
That includes offering companies so-called non-prosecution agreements (NPAs) — agreements that Democrats have criticized in the past.
“Our approach is: let’s sign an NPA as quickly as possible that requires continued cooperation,” he said.
Clayton, an appointee of President Donald Trump, said a different approach to working together would also benefit shareholders. He previously led the SEC, a civil regulator, during Trump’s first presidential term, when it focused primarily on retail investors.
He said these retail investors remain one of his top priorities on white-collar crime, noting his focus on misconduct in small-cap stocks, private equity funds and prediction markets. Asked whether he foresees prosecution in connection with these so-called event contracts, he said: “Yes.”
Clayton also criticized past enforcement of the Foreign Corrupt Practices Act, which was enacted in 1977 and prohibits companies operating in the United States from bribing foreign officials.
The Justice Department suspended enforcement of the law last year and resumed it with plans for more streamlined measures. Clayton criticized the law as putting the United States at a disadvantage relative to other countries and punishing companies rather than targeting individual violators.
“I hate corruption by foreign officials,” Clayton said. “I hate the FCPA as it applies.”
(Reporting by Chris Prentice; Editing by Chitsu Noyama)
