Introduction

The U.S. Department of Justice (DOJ) is currently undergoing significant transformations that have raised questions about the future of white-collar crime enforcement. Observers note that under President Donald Trump, the DOJ has shifted its focus away from traditional corporate and financial crimes.

Current Enforcement Landscape

According to Steven Fagell, co-chair of Covington & Burling’s white-collar defense and investigations practice, the DOJ has not prioritized white-collar enforcement during its recent reorganization period. Historically, the DOJ has targeted various crimes, including corporate fraud, money laundering, and foreign corruption, through various specialized divisions like the Criminal Division’s Fraud Section.

With a stated focus on combating drug cartels and transnational criminal activities, the Trump administration aims to realign resources within the DOJ, as evidenced by the confirmation of U.S. Attorney General Pamela Bondi. Her guidance suggests a departure from the previous enforcement priorities.

Key Changes in Focus Areas

Reduction in White-Collar Crime Prosecution

Recent reports indicate that the DOJ plans to decrease the number of prosecutors dedicated to foreign bribery and money laundering cases. This shift was noted alongside the reassignment and demotion of several long-time attorneys within the department.

Impact on the Foreign Corrupt Practices Act (FCPA)

Under the new directives, Bondi’s memo highlighted a strategic pivot in enforcing the FCPA. This law prohibits U.S. entities from engaging in bribery of foreign officials to gain business advantages. The DOJ will now prioritize inquiries connected to drug cartels and related criminal networks, temporarily placing other FCPA investigations on hold.

Anticipating Future Actions

While it is too early to ascertain the long-term effects of these changes, legal professionals are monitoring how different jurisdictions might respond. Raymond Banoun, a former assistant U.S. attorney, suggests that if the U.S. deprioritizes FCPA enforcement, foreign governments with their own anti-corruption laws may intensify their efforts.

Jacob Frenkel, chair of government investigations at Dickinson Wright, also points out that individual U.S. attorneys might adopt a more independent approach in choosing which cases to pursue, while state attorneys general may take a more active role in enforcement.

Additional Shifts in the DOJ’s Approach

The DOJ’s recent decisions appear to signify a notable retreat from longstanding white-collar enforcement. Specifically, several initiatives targeting kleptocracy and foreign influence are being disbanded. Bondi’s memos indicate a reallocation of resources toward combating drug-related crime and enhancing border security.

Changes Beyond the DOJ

Organizations such as the SEC and the Commodity Futures Trading Commission are also undergoing significant restructuring. Reports indicate a pause or reduction in litigation against cryptocurrency firms initiated during the Biden administration, alongside heightened regulatory scrutiny.

It remains to be seen how these changes will influence the overall atmosphere of corporate compliance and enforcement. Carrie Cohen, co-chair of the investigations and white-collar defense practice at Morrison & Foerster, emphasizes that while the regulatory landscape is evolving, foundational laws like the FCPA remain intact and enforceable.

Conclusion

The DOJ’s shifting priorities under the Trump administration mark a significant transition in the enforcement of white-collar crimes. As new strategies are implemented, legal professionals and corporations must remain vigilant to adjust to an evolving compliance landscape while ensuring adherence to existing laws.