The Department of Justice Civil Division officially announced the release of expected formal guidance on voluntary misconduct disclosures and cooperation credit during False Claims Act investigations. The formal policy is now included in the Justice Manual Section 4-4.112.
Under the policy, cooperation credit in False Claims Act cases may be earned by voluntarily disclosing misconduct unknown to the government, cooperating in an ongoing investigation, or undertaking remedial measures in response to a violation. Even if the government already has initiated an investigation, a company may receive credit for making a voluntary self-disclosure of other misconduct outside the scope of the government’s existing investigation that is unknown to the government. Similarly, a company may earn credit by preserving relevant documents and information beyond existing business practices or legal requirements, identifying individuals who are aware of relevant information or conduct, and facilitating review and evaluation of data or information that requires access to special or proprietary technologies.
Under the policy, DOJ will consider corrective action that a company has taken in response to an FCA violation, such as conducting a root cause analysis, disciplining or removing responsible personnel, and implementing or improving compliance programs to prevent a recurrence. Most frequently, cooperation credit will take the form of a reduction in the damages multiplier and civil penalties. If appropriate, DOJ also may notify a relevant agency about the company’s voluntary disclosure, cooperation, or remediation so that the agency can take those actions into account in deciding how to apply administrative remedies. For the full policy, click here.