Many commentators have speculated about the direction white-collar enforcement may take under President Trump’s second term. A May 12 memorandum from Matthew R Galeotti, Head of the Department of Justice’s (Department) Criminal Division, sheds light on the Department’s evolving approach. The memorandum, titled Focus, Fairness, and Efficiency in the Fight Against White-Collar Crime (Galeotti Memorandum), covers three primary tenets that will guide the Department’s prosecution of white-collar matters: focus, fairness, and efficiency.

In general, Galeotti emphasizes the Department’s commitment to “do justice, uphold the rule of law, protect the American public, and vindicate victims’ rights.” Additionally, Galeotti notes that white-collar offenses pose a “significant threat to US interests.” That said, the Department intends to take a “targeted and efficient” approach that would not result in overly broad enforcement, which could “punish risk-taking and hinder innovation.”

Focus: Targeting significant threats to US Interests

Under the focus prong, the Galeotti Memorandum directs prosecutors to concentrate on white-collar offenses that present a substantial threat to US interests. Those offenses can cause a number of harms, including:

• exploiting governmental programs (for example, healthcare and defense spending fraud);
• targeting US investors and undermining market integrity (for example, elder fraud, investment fraud, and Ponzi schemes);
• compromising monetary systems and economic development;
• threatening the American economy and national security; and
• corrupting the American financial system.

To address these harms, the Criminal Division will make it a priority to combat healthcare fraud, trade and customs fraud, elder and securities fraud, complex money laundering (including “Chinese Money Laundering Organizations”), crimes compromising national security, corporate support of foreign terrorist organizations, violations of the Controlled Substances Act and the Federal Food, Drug, and Cosmetic Act, and criminal conduct involving digital assets.

In addition to identifying and seizing the proceeds of the above-listed crimes to compensate victims, the Department will prioritize cases involving senior-level personnel, demonstrable loss, and obstruction of justice. The Department is also expanding its Corporate Whistleblower Awards Pilot Program to prioritize tips that result in forfeiture in areas such as international cartels, federal immigration law violations, material support of terrorism, corporate sanctions offenses, trade and customs fraud, and procurement fraud.

Fairness: Ensuring equal and just application of the law

The second tenet, fairness, underscores that “justice demands the equal and fair application of criminal laws to individuals and corporations who commit crimes.” The Department continues to emphasize individual liability, focusing on executives, officers, and employees directly responsible for wrongdoing.

Galeotti acknowledges that most American businesses are legitimate and warns that enforcement overreach can “punish risk-taking and hinder innovation.” Similarly, not all corporate misconduct warrants federal criminal prosecution; civil and administrative remedies may suffice for low-level misconduct. Prosecutors are instructed to consider factors such as self-reporting, cooperation, and remediation when making charging decisions.

Transparency is a cornerstone of the fairness directive. The Department is committed to making the terms of corporate resolutions – such as declinations, fine reductions, and relevant factors for resolution – “more easily understandable.” The revised Corporate Enforcement and Voluntary Self-Disclosure Policy provides incentives for companies that self-disclose, including potentially shorter oversight terms and early termination of agreements.

The Department is also reviewing existing agreements to determine whether early termination is warranted based on factors like the duration of the post-resolution period, substantial reduction in the company’s risk profile, remediation efforts, and the maturity of the company’s compliance program. For companies that have cooperated and performed the necessary remediation, the terms for corporate resolutions will generally not exceed three years, except in rare circumstances, and will be regularly reassessed.

Efficiency: Streamlining investigations and monitorships

The final tenet, efficiency, aims to maximize the effectiveness of Department investigations while minimizing costs, intrusiveness, and unwarranted reputational damage to businesses. The Galeotti Memorandum identifies two main areas for improvement: the investigative process and the use of corporate monitors.

With respect to investigations, the Department’s goal of efficiency is targeted at the length of investigations. The Galeotti Memorandum notes that white-collar investigations are often lengthy and complex. In light of that, Galeotti instructs prosecutors to “take all reasonable steps” to move expeditiously and reduce the collateral impact of white-collar investigations. The Criminal Division will exercise greater oversight to ensure investigations are “swiftly concluded.”

Regarding monitorships, the Galeotti Memorandum stresses that they should only be imposed when necessary – specifically, when a company cannot be expected to implement an effective compliance program or prevent recurrence of misconduct without external oversight. When monitorships are appropriate, their mandates must be carefully scoped to minimize expense, burden, and business disruption. The Department is reviewing all existing monitorships to determine if they remain necessary.

The Galeotti Memorandum also references the updated Memorandum on Selection of Monitors in Criminal Division Matters, which refines the monitor selection process and ensures that monitorships are narrowly tailored to address the risks of recurrence and avoid unnecessary expenses. Prosecutors are asked to evaluate factors such as the risk of recurrence, availability of other oversight, efficacy of the compliance program, and the maturity of the company’s controls.

To ensure monitorships are properly tailored, the Criminal Division will:

• ensure the cost of a monitorship is proportional to the severity of the conduct, company profits, and risk profile;
• hold at least biannual tri-partite meetings with the monitor and company; and
• collaborate with the monitor and company to achieve an effective, risk-based compliance program.

The Galeotti Memorandum makes clear that the Department remains committed to combating white-collar crime, particularly in high-priority areas such as healthcare fraud and national security threats.

The approach is evolving, however, to ensure that enforcement is focused, fair, and efficient by targeting the most significant threats, ensuring just and transparent outcomes, and minimizing unnecessary burden on business interests. Companies should carefully consider these changes as they develop compliance programs and address potential misconduct within their operations.