The Long Awaited McNulty Memo Misses the point…

Yesterday, Deputy U.S. Attorney General McNulty released a long-awaited and much anticipated memorandum to clarify the policy of federal prosecutors and the factors they will consider in making decisions whether to charge organizations with crimes. The memo does little to allay the concerns of the private and corporate bar, who were looking for a firm denouncement stating that the practice of requesting waiver of privilege in a coercive manner is unethical or unlawful. Instead, in sum, the McNulty memo says prosecutors may ask for privilege waiver if they obtain approval from the US Attorney or a Deputy Attorney General. This “clarification” will do nothing more than galvanize the bar, which in this unique circumstance is united on all fronts, and add momentum to the force behind the Specter bill, introduced last week before Congress ended its term. This action should also infuse more passion into the comments on proposed Rule 502 to the Federal Rules of Evidence in 2007.

Notwithstanding, the DOJ and the Bar continue to miss the boat on how to gauge corporate conduct in connection with charge or enforcement decisions. Instead of seemingly exclusive reliance on waiver as a measure of cooperation, the government and bar should spend the time necessary to establish acceptable standards to measure the overall effectiveness of compliance and ethics programs. While organizations across the land continue to spend money hand over fist on building effective compliance programs per the Federal Sentencing Guidelines, the rest of the universe is fixated on a dialogue about whether organizations are willing to waive privileges.

As a constructive complement to the debate on the privilege question, let’s start to expend energy to establshing standards and means by which to measure effectiveness of compliance programs. With better recognition of effectiveness, the government should start giving credit where credit is due. Unbalanced reliance on privilege waiver as a sole measure of cooperation is taking the easy way out.


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DOJ Press Release on McNulty Memo

McNulty Speech

McNulty Memo Executive Summary

McNulty Cover Memo

The McNulty Memo

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