Closing the gap: The DOJ aligns corporate self‑disclosure incentives across components

A tale of two (or many) self-disclosure policies

The new Department-wide CEP is the latest expansion of a policy that has grown steadily in reach since its inception. Started in 2016 as a narrow pilot program outlining a path to declination for companies that voluntarily self-disclosed Foreign Corrupt Practices Act (FCPA) violations, the CEP later expanded to apply to all cases and crimes prosecuted by the Criminal Division.

In 2023, U.S. Attorney’s Offices nationwide collectively established a Voluntary Self-Disclosure Policy of their own (USAO Policy). The USAO Policy provided that USAOs “[would] not seek a guilty plea” where a company met the standards for voluntary self-disclosure and where aggravating factors were not present – but left open the possibility of non-prosecution agreements and deferred prosecution agreements. This benefit diverged from the Criminal Division policy, which, at the time promised a “presumption of declination” under the same circumstances.

As the Criminal Division CEP continued to evolve, the gap between the USAO Policy and Criminal Division policy widened. Most recently, as we discussed in a previous alert, the DOJ made sweeping changes to the Criminal Division’s CEP in May 2025. Notably, the May 2025 revisions indicated that the Criminal Division “[would] decline to prosecute” companies that met the criteria for voluntary self-disclosure, absent aggravating factors. Although the Southern District of New York – known for its white collar enforcement focus – established its own Corporate Enforcement Policy and Voluntary Self-Disclosure Program For Financial Crimes (just two weeks before the announcement of the new Department-wide CEP) that offered benefits more closely aligned with the Criminal Division policy in a subset of cases, this strong assurance of a declination absent aggravating circumstances further deepened the divide between benefits for self-disclosure provided by the USAOs and the Criminal Division.

The divergence of the USAO Policy from the Criminal Division policy saddled companies with complex – and often fraught – strategic considerations about whether and where to disclose misconduct and injected uncertainty into which policy might apply. The new CEP seeks to ensure consistency across all DOJ components and U.S. Attorney’s Offices and aims to further incentivize corporate self-disclosure by establishing a uniform array of outcomes across divisions and offices.

The new CEP

The new Department-wide CEP hews closely to the May 2025 version of the Criminal Division’s CEP in form and substance. Like the May 2025 Criminal Division policy, the new CEP seeks to provide a greater degree of predictability and a stronger basis for reliance by indicating that the Department “will decline to prosecute” companies that voluntarily disclose, fully cooperate, and appropriately remediate misconduct where there are no aggravating factors. The new CEP also outlines a path to a non-prosecution agreement with reduced fines in “near miss” scenarios (i.e., where a company self-reported misconduct but issues with the disclosure or other aggravating factors disqualified it from a declination under the policy).

Although the new CEP closely mirrors the previous Criminal Division policy, it differs in some notable ways:

• Department-wide application – The biggest change to the CEP is, of course, the expansion of its reach. Although the prior policy applied only to the Criminal Division, the new CEP “applies to all corporate matters handled by the Department, except [criminal antitrust violations].” Because the new CEP applies to all components of DOJ and all U.S. Attorney’s Offices, companies may now get self-disclosure credit for reporting conduct to the “appropriate DOJ Criminal Component” – not just the Criminal Division.¹ Although the revised policy itself is silent on its interaction with any pre-existing corporate enforcement policies, the press release announcing the new CEP indicates that the policy “supersed[es] all component-specific or U.S. Attorney’s Office-specific corporate enforcement policies currently in effect.”
• Disclosures to the appropriate component of the Department – Under the CEP, disclosures must be made to the appropriate component of the DOJ. But “[g]ood faith disclosure to one component where the matter is later brought to another appropriate component for investigation will also qualify.” The CEP attempts to discourage forum-shopping outside of the DOJ: “Disclosures made only to federal regulatory agencies, state and local governments, or civil enforcement agencies generally do not qualify,” unless appropriate under the circumstances. Such disclosures may still be considered as part of a company’s cooperation and remediation.
• Tweaks to “aggravating circumstances” – The updated CEP reflects a slight expansion of the description of “aggravating circumstances” that could threaten a company’s eligibility for declination. While the May 2025 policy included “criminal adjudication or resolution within the last five years based on similar misconduct by the entity engaged in the current misconduct” as an aggravating circumstance, the revised CEP broadens the approach to corporate recidivism to include “criminal adjudication or resolution either within the last five years or otherwise based on similar misconduct by the entity engaged in the current misconduct.”
• New fine reduction range for “near misses” – The new CEP also changes the fine reduction a company can expect in a “near miss” scenario from a flat 75 percent off the low end of the U.S. Sentencing Guidelines (U.S.S.G.) fine range in the May 2025 policy to a range from 50-75 percent off the U.S.S.G. fine range in the new CEP.
• Disgorgement still required – Although fines can be reduced significantly under the CEP, disgorgement and restitution resulting from the misconduct at issue must still be made. Often, those payments will dwarf the reduced fines.

What do the changes mean for corporate self-disclosure

Although this latest iteration of the CEP maintains the substance of the Criminal Division’s May 2025 policy, the expansion of the policy to apply Department-wide and across all U.S. Attorney’s Offices will change the strategy surrounding how and where a company self-reports misconduct. A company can now make a good faith decision regarding venue and prosecutorial expertise when determining the appropriate component to which to provide its self-disclosure, without concern that the company will face a worse outcome if another component eventually handles the investigation.

Given the CEP’s powerful incentives to self-disclose misconduct before (or quickly after) a whistleblower reports to the government or the government learns of the misconduct in some other way, it is now more important than ever that companies review and test their compliance policies to ensure that they are identifying misconduct promptly and accurately to preserve the option of voluntary self-disclosure. But even with the significant and uniform incentives in the new CEP, the decision whether to self-disclose is difficult and fact-dependent. An enforcement policy like this is a decision made administratively and reflects the enforcement priorities and philosophies of an incumbent DOJ; such a policy can change with a new Administration. Companies should consult counsel and thoroughly assess potential risks, benefits, and strategies before disclosing misconduct to the government.

Authored by Jerrob Duffy, Douglas Fellman, Lillian S. Hardy, Ann C. Kim, David Sharfstein, Peter Spivack, Matthew Sullivan, and Stephanie Yonekura.