“Flesh-and-blood” corporate criminals have long been a major focus of U.S. enforcement authorities in the battle against foreign bribery. Many of the actions taken against individuals were largely enabled due to the cooperation of culpable corporations with investigative authorities. For years, this cooperation was encouraged by the award of “cooperation credit,” which is a mitigated approach toward cooperating corporations. The Yates Memorandum promulgated recently by the Department of Justice, however, has changed the rules of the game. According to the memo, the Department of Justice will no longer provide “cooperation credit” to corporations unless they demonstrate their cooperative approach by “sacrificing” employees involved in bribery. While the newly emerged policy seeks to send a reinforced message of deterrence to corporate executives, a law and economics analysis reveals that the Yates Memo may fall short of reaching its deterrence goals, and in fact may lead to more — rather than fewer — bribery practices.

Yates memo, cooperation credit, regulatory credit, enforcement, liability, individual accountability, conflict of interest, sanction mitigation, FCPA, bribery, corruption
Government Policy and Regulation (jel G38), Criminal Law (jel K14), Corporation and Securities Law (jel K22), Illegal Behavior and the Enforcement of Law (jel K42), Regulation and Industrial Policy: General (jel L50)
hdl.handle.net/1765/104400
Rotterdam Institute of Law and Economics

Oded, S. (2017). Coughing Up Executives or Rolling the Dice?: Individual Accountability for Corporate Corruption. Retrieved from http://hdl.handle.net/1765/104400