Compliance and Individual Liability

Compliance officers have said that our focus on individuals

has helped them steer officers and employees within their

organizations toward best practices and higher standards. 

Sally Q. Yates

Sally Q. Yates, Deputy Attorney General, does not particularly like the name “Yates Memo” being applied to the U.S. Department of Justice’s (DOJ’s) 2015 memorandum titled “Individual Accountability for Corporate Wrongdoing.” She calls it the Individual Accountability Policy, but acknowledges that she may have lost the name battle (Yates, 2016).

In her recent remarks to the New York City Bar Association White Collar Crime Conference, Yates said, “holding individuals accountable for corporate wrongdoing has always been a priority for the Department of Justice…,” but that the DOJ also faced many challenges in their efforts to identify responsible parties.

It is not easy to disentangle who did what within a huge corporate structure – to discern whether anyone had the requisite knowledge and intent. Blurred lines of authority make it hard to identify who is responsible for individual business decisions and it can be difficult to determine whether high-ranking executives, who appear to be removed from day-to-day operations, were part of a particular scheme. There are often massive numbers of electronic documents and for corporations that operate worldwide, there are restrictive foreign data privacy laws and a limited ability to compel the testimony of witnesses abroad (Yates, 2016).

The 2015 Individual Accountability Policy (Yates Memo) was a response to those challenges; it identified six steps the DOJ would take to hold individuals accountable for their actions. We listed those six steps in our blog post “Individual Liability for Corporate Wrongdoing.” Yates provided a summary at the conference, as follows:

We now require a company to provide all the facts about individual conduct in order to qualify for any cooperation credit. We have sought to increase coordination between the criminal and civil sides of our house and require all our attorneys to focus on individual liability from the very beginning of an investigation. We will initiate civil proceedings against a bad corporate actor, even if that individual may not have the financial resources to satisfy a large money judgment. And we have shifted the presumption on what a corporate resolution looks like. Now, our attorneys must get approval if they decide not to bring charges against individuals and may not release individuals from civil or criminal liability except under the rarest of circumstances.

So, how is it going, eight months into implementation? Yates said it’s going well. “Companies are not only continuing to cooperate, they are making real and tangible efforts to adhere to our requirement that they identify facts about individual conduct….”

Moreover, she said, “We’ve affirmatively been hearing that our new approach is causing positive change within companies. Compliance officers have said that our focus on individuals has helped them steer officers and employees within their organizations toward best practices and higher standards. That’s exactly what we had hoped for.”

The new approach has caused changes within the DOJ as well. According to Yates, the focus on potential culpability of individuals begins very early in both criminal and civil investigations; this is an especially big change on the civil side. “There is a more uniform, systemic, and sustained focus on individuals,” taking into account factors like the nature and seriousness of the offense, the offender’s role, and any history of misconduct by the offender.

Yates expects these individual-focused efforts to serve as deterrence, “stopping fraud from happening in the first place,” while also ensuring that wrongdoers are held accountable regardless of “position or title, power or wealth.”

Ethical Advocate provides comprehensive ethics and compliance solutions, including confidential and anonymous hotlines and training on fraud awareness, business ethics, harassment and discrimination, and more. Contact us for more information.


U.S. Department of Justice. “Individual Accountability for Corporate Wrongdoing,” (memorandum), September 9, 2015.

Yates, Sally Q. “Deputy Attorney General Sally Q. Yates Delivers Remarks at the New York City Bar Association White Collar Crime Conference,” May 10, 2016.