Attorney General William Barr warned regulators Thursday against imposing excessive punishments on corporate offenders because it could hurt investors.
Speaking at the Securities and Exchange Commission, Mr. Barr said authorities must avoid “piling on” in corporate cases.
“During parallel investigations, our agencies should ensure that we remain mindful of — and properly account for — the collateral consequences that our matters can sometimes have,” he said.
The speech was Mr. Barr’s first public appearance since he was named in a transcript released last week of President Trump’s phone call with Ukrainian President Volodymyr Zelensky.
During the call, Mr. Trump repeatedly prodded his Ukrainian counterpart to get in touch with Mr. Barr about investigating former Vice President Joseph R. Biden and his son Hunter. Mr. Barr has said he has no knowledge of the call and has not had any communication with Mr. Zelensky.
Mr. Barr did not address the Ukraine controversy. Instead, he stuck to his prepared remarks on combatting corporate crime.
The Justice Department announced last year it would shift its corporate enforcement policy to avoid unnecessary or duplicative penalties against companies. At the time the Justice Department said the move was to ensure that the department “only pursues sanctions that are proportionate to the defendants’ conduct.”
“In many cases, these costs are borne not just by the wrongdoers but also by others who were not involved in the misconduct, such as shareholders,” Mr. Barr said. “And these costs are often amplified in our increasingly complex regulatory environment when multiple criminal and regulatory enforcement agencies seek to investigate the same or overlapping conduct.”
Mr. Barr cited a few recent cases in which he said the Justice Department and SEC streamlined penalties to benefit investors.
In March, Russian telecommunications company Mobile TeleSystems PJSC agreed to pay $850 million to resolve federal bribery charges. Justice Department prosecutors agreed to credit the company $100 million for a fine paid to the SEC.
Parallel investigations by the Justice Department and SEC resulted in trucking company Celadon Group Inc. paying $42.2 million in restitution to its investors. The agencies were looking into whether the company’s previous management team filed false and misleading investor statements.
Mr. Barr said corporate enforcement isn’t limited to punishing wrongdoers. Instead, agencies should work to promote ethical business practices through their enforcement actions.
One way the agencies can achieve that goal is by giving corporate offenders credit for good behavior and cooperation, he said. He added that corporations should get benefits for self-reporting misconduct.
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