On March 10, 2026, the Department of Justice announced its first-ever department-wide law enforcement policy for all criminal matters. Under the new policy, companies that self-report misconduct could be eligible for denial and avoid fines or oversight.
The Department of Justice (DOJ) recently announced its first-ever department-wide plan Company Application Policy (CEP), following the announcement by Deputy Attorney General Todd Blanche in December 2025 of the imminent arrival of such a policy. The policy provides a penalty- and oversight-free declination to companies that voluntarily disclose, cooperate fully, and remediate in a timely and appropriate manner, absent aggravating circumstances. In the event of aggravating circumstances (such as the pervasiveness or serious nature of misconduct or recurrence), the DOJ still retains the discretion to issue a refusal. In cases of aggravating circumstances where the DOJ does not refuse, or where a company has a “near miss” voluntary disclosure, the company would receive a non-prosecution agreement (NPA) with a potentially shortened duration and a 50-75% reduction on the otherwise applicable fine, as well as no monitor. The new policy also includes a simple to follow organizational chart for ease of reference.
With this announcement, for the first time, the DOJ will have an enforcement policy that will apply to criminal cases across all components and U.S. Attorneys' Offices, with the exception of antitrust cases (which are subject to their own leniency program). According to the DOJ, the new policy “is designed to: (1) promote voluntary and early disclosure of criminal conduct; (2) promote prompt and effective enforcement of criminal laws, including accountability of guilty individuals; (3) reduce harm; (4) facilitate prompt corrective action, including requiring companies to compensate victims and address company deficiencies; (5) help ensure consistency within the ministry; and (6) transparently describe departmental policies and decision-making. » There are a number of beneficial aspects of this policy that are more business-friendly than enforcement policies announced in previous years, but it will be important for businesses to continue to consider the risks and benefits of voluntary disclosure of misconduct.
Key aspects of the new policy
Key to the Justice Department's new enforcement policy are the incentives it provides to companies that disclose misconduct to the Justice Department and fully cooperate and remedy it. Specifically, the CEP requires a denial if a company voluntarily self-discloses to the appropriate DOJ component, cooperates fully, and remediates in a timely and appropriate manner, absent aggravating circumstances.
Voluntary disclosure
The CEP sets out several requirements for a company's self-report to be considered voluntary self-disclosure:
- The disclosure is made in good faith;
- Disclosure is made to the appropriate component of the DOJ;
- The misconduct is not previously known to the DOJ;
- The company has no pre-existing obligation to disclose the conduct to the DOJ;
- The disclosure occurs before an imminent threat of disclosure or government investigation; And
- Disclosure occurs “reasonably promptly” after the company becomes aware of the misconduct.
For voluntary disclosure to result in refusal, there must be no aggravating circumstances. Aggravating circumstances include the nature and seriousness of the offense, the serious or widespread nature of the misconduct within the company, whether the company is a repeat offender, and the seriousness of the harm caused by the misconduct. Findings of corporate recidivism are based on criminal judgments or resolutions either within the previous five years or similar misconduct by the company. Unlike prior versions of the DOJ's enforcement policies, the involvement of senior executives in misconduct does not constitute an aggravating circumstance.
Additionally, even in cases of aggravating circumstances, “prosecutors retain the discretion to nevertheless recommend a denial of CEP based on the severity of those circumstances and the company's voluntary disclosure, cooperation, and corrective actions.”
The CEP also contains an exception to the Corporate Whistleblower Rewards Pilot Program from the general rule that disclosure must be made in the absence of an imminent threat of disclosure and before DOJ becomes aware of the allegations. Under this exception, a company may still benefit from an opt-out if a whistleblower makes an internal company report and/or whistleblower submission to the DOJ as long as the company (1) self-reports the conduct to the DOJ as soon as reasonably possible – but no later than 120 days after receipt of the whistleblower report – and (2) meets the other voluntary self-disclosure requirements under the CEP.
The policy also includes a statement that the DOJ will notify the company whether it qualifies for a denial as quickly as possible after the company's disclosure. In the past, companies often had to wait until the investigation was completed to find out whether their report was considered a voluntary disclosure under the program.
Cases of “near misses”
The policy establishes a specific approach for “near miss” voluntary self-disclosures, in which the company has fully cooperated and remediated in a timely and appropriate manner, but is nevertheless not eligible for denial because either (1) its voluntary good faith disclosure is not considered a voluntary self-disclosure under the CEP or (2) aggravating factors that warrant criminal resolution are present. For example, a “near miss” case occurs when the DOJ is already aware of the misconduct, but the company has otherwise met the CEP's requirements.
In such circumstances, the DOJ will provide an NPA and reduce the otherwise applicable fine by 50 to 75 percent from the lower end of the applicable range of the U.S. Sentencing Guidelines. Additionally, the DOJ will decline to impose a monitor and may limit the duration of the NPA to less than three years.
Resolutions in other cases
If a business does not qualify for denial under the CEP or resolution under the “near miss” provision of the policy, attorneys will retain discretion to determine the appropriate resolution. The company will not benefit from a fine reduction of more than 50%.
Other relevant factors
To be eligible for a denial, businesses must cooperate fully and provide timely and appropriate corrective action. Full cooperation requires prompt, true and accurate disclosure of all non-privileged facts and evidence relevant to the conduct at issue. Cooperation also requires preserving and disclosing relevant documents and resolving conflicts between witness interviews and other investigative measures to prevent the company's own investigation from conflicting or interfering with that of the DOJ.
With respect to dispute resolution, the CEP notes that it is not intended “to prohibit a company from taking actions that it is otherwise required to take under applicable laws and regulations,” but that where such actions may conflict with the DOJ's investigation or a dispute resolution request, the company is expected to notify the DOJ prior to taking such actions with sufficient time to allow the DOJ to respond.
When it comes to corrective action, companies must address the root causes of the conduct, implement an effective compliance and ethics program, and appropriately discipline employees. Companies must also properly maintain business records and take any additional steps demonstrating the seriousness of the company's misconduct, acceptance of responsibility for the misconduct, and implementation of measures to reduce the risk of repetition of the conduct.
The CEP includes an easy-to-follow guide organizational chart to help businesses determine if they are eligible for denial.
The policy applies to all DOJ criminal cases except antitrust cases, which are subject to a leniency program that has existed for more than 30 years.
Key takeaways
The new DOJ Corporate Enforcement Policy marks the first time that all corporate criminal cases at DOJ (other than antitrust cases) will be subject to the same policy, makes clear that DOJ emphasizes transparency and consistency in its approach to corporate enforcement, and supports DOJ's long-standing efforts to encourage voluntary disclosures.
A number of features of the policy are more business-friendly than the component-specific policies of previous years. For example, the fact that the involvement of senior executives in misconduct does not constitute an “aggravating circumstance” means that a company will still receive a refusal even if the investigation reveals that the misconduct was committed at a higher level within the company than initially thought. Likewise, the fact that the DOJ will now notify companies as soon as possible after disclosure whether they qualify for voluntary disclosure addresses concerns that companies would often wait years to find out if they were eligible.
The policy also reflects the Justice Department's continued shift away from imposing oversight, which has long been criticized for the significant burdens and costs it imposes on businesses.
Companies should continue to weigh the risks and benefits of disclosing under this policy when they discover potential misconduct.
This article is based on a memorandum from Davis, Polk & Wardwell LLP, “DOJ Announces Self-Disclosure Policy for All Criminal Cases», dated March 16, 2026 and available here.
