In an important shift, the Department of Justice (DOJ) recently announced a safe harbor policy for voluntary self-disclosure in the context of acquisitions, echoing a global trend towards leniency. The new policy is a continuation of the DOJ’s effort to empower compliance professionals and incentivize compliance, while simultaneously positioning compliance as a cost-saving center in businesses and corporations.
The safe-harbor policy demands a keen understanding of diligence and post-acquisition investigation to ensure acquired misconduct is properly unearthed. A deadline of six months from the point of acquisition is imposed for voluntary self-disclosure, placing a considerable onus on companies and their compliance departments.
While the policy presents a potential new route to navigate through thorny legal issues related to acquisitions, it also puts corporate compliance under a spotlight, intensifying the pressures on legal departments across industries. Compliance professionals in particular will need to lead effective investigations into potential misconduct, whilst adhering to the short window offered for self-disclosure. With each successful implementation of the policy, this not only strengthens the company’s standing, but also furthers the DOJ’s broader goal of embedding a culture of robust compliance in the corporate world.
As such, compliance professionals working in multinational corporations and law firms might find it beneficial to stay abreast of this policy change. This is especially true for those involved with mergers and acquisitions, a domain where discrepancies and misconduct can easily be overlooked and carry hefty consequences.
The merits and potential pitfalls of the safe harbor policy warrant further investigation and scrutiny. It stands as a new challenge and tool for compliance professionals in safeguarding the integrity of their respective organizations.