Monaco doesn’t want to take any tools off the table for prosecutors, but she has previously said existing agreements can be unwound in light of new revelations of wrongdoing.
The Archegos case shows the department is prepared to go after high-ranking individuals, by focusing on the firm’s founder, Bill Hwang, and his chief financial officer, Patrick Halligan. The department has also brought charges against the former chief investment officer of Allianz’s Structured Alpha funds, Greg Tournant. All three men have pleaded not guilty.
Months prior to its settlement with Glencore, the Justice Department secured two guilty pleas from traders at the company for crimes including bribery and price manipulation. No additional charges against individuals were announced with the company’s guilty plea last month.
Self-Reporting
Monaco has warned companies that they need to come forward and self report any issues to authorities. The lack of self-reporting was a factor in the decision to seek guilty pleas from Glencore and the Allianz unit, she said at a gathering last week of the securities industry.
“Self-reporting and cooperation are two different matters,” Monaco said at a Securities Industry and Financial Markets Association conference in New York on Thursday. “If you don’t self-report, you start from behind the 8-ball, you start from a significant deficit with the Department of Justice.”
The Justice Department’s tougher position on self-reporting might backfire, given its longstanding need to rely on such material, said Dan Richman, a former federal prosecutor who teaches at Columbia Law School.
“How seriously the department will punish failure to self-report remains to be seen, since it will still have to give firms that failed to self-report an incentive to cooperate in an investigation triggered by some other means,” Richman wrote in an email.
This article was provided by Bloomberg News.