On May 12, 2025, the US Department of Justice’s Criminal Division published a set of memoranda outlining white collar enforcement priorities and an updated outlook on the imposition and selection of corporate monitors. The Memorandum on Selection of Monitors in Criminal Division Matters provides fresh guidance on the standards and procedures for imposing, selecting, and overseeing independent compliance monitors in corporate resolutions while reiterating the core aspects of historical policies.
Overall, the Memorandum’s most notable changes relate to (1) cost and budget limitations, (2) mandating open dialogue and collaboration through regular meetings with the company, monitor, and Criminal Division, and (3) removal of diversity, equity, and inclusion language. These differences reflect a shift away from the traditionally hands-off approach taken by the government and in the direction of greater financial oversight, transparency, and engagement throughout the process.
This LawFlash serves as a continuation of our previous coverage on the administration’s corporate enforcement policies. [1] Our white collar litigation and government investigations team will continue to track developments and provide analysis on any DOJ enforcement actions undertaken pursuant to the updated policies.
In 2008, in response to increasing scrutiny of the corporate monitorship process, then-Acting Deputy Attorney General Craig S. Morford issued “Selection and Use of Monitors in Deferred Prosecution Agreements and Non-Prosecution Agreements with Corporations” (the Morford Memorandum).
Most notably, the Morford Memorandum required each DOJ component to “create a standing or ad hoc committee [] of prosecutors to consider the selection or veto, as appropriate, of monitor candidates.”
In 2009 and 2010, respectively, DOJ released two further memoranda relating to the appointment of corporate monitors, the Breuer Memorandum and Grindler Memorandum, which supplemented the Morford Memorandum in establishing policies and procedures for monitor selection, including creating a standing committee to oversee selection and adding principles relating to the resolution of disputes between the monitor and the corporation.
DOJ then remained silent on corporate monitors until 2018 when then-Assistant Attorney General Brian Benczkowski released the Benczkowski Memorandum, which largely incorporated and restated the prior guidance relating to the selection and retention of monitors. Yet, the Benczkowski Memorandum highlighted the costs and burdens associated with the monitorships by encouraging their use only where there was a “demonstrable need” for them.
Starting in 2021, the Biden administration retained the Benczkowski Memorandum’s approach to the imposition and selection of monitors but reversed the suggestion that a corporate monitorship was the exception rather than the rule. [2] Constituting a new development, the Polite Memorandum reinforced the Criminal Division’s commitment to diversity, equity, and inclusion, providing the ability for DOJ to reject a monitorship candidate on those grounds.
The May 12 memorandum seeks to advance the objectives outlined in the Criminal Division’s white collar enforcement priorities memorandum “Focus, Fairness, and Efficiency in the Fight Against White-Collar Crime” (the Enforcement Memorandum).
With respect to “efficiency,” the Enforcement Memorandum noted that, in line with a focus on “efficient investigations,” prosecutors must minimize the length and “collateral impact” of investigations to ensure they do not “linger.”
The Enforcement Memorandum also referenced a forthcoming revised corporate monitorship policy. Previewing the content of the Memorandum, the Enforcement Memorandum stated that corporate monitorships should be, at their core, “narrowly tailored” and imposed only when “necessary,” which encompasses when (1) a company cannot be expected to implement an effective compliance program or (2) the prevention of the underlying misconduct’s reoccurrence cannot occur without “such heavy-handed intervention.”
The Enforcement Memorandum noted that in the narrow circumstances where monitorships are “necessary” they should be narrowly tailored in scope and mandate. Given the shifting guidance, the Enforcement Memorandum announced a divisionwide “individualized review” of all existing monitorships to determine if they are still necessary in line with these goals.
After previewing the fresh guidance, the Criminal Division released its expanded Memorandum on Selection of Monitors in Criminal Division Matters that same day. Notably, the Memorandum incorporates by reference the Morford Memorandum and draws from pre-2021 policies when (1) updating the factors that prosecutors must consider when determining whether a monitor is appropriate and (2) ensuring that where a monitor is necessary prosecutors “appropriately tailor and scope the monitor’s review and mandate” to reduce risks of recidivism and unnecessary costs.
The Memorandum’s stated goal is to ensure a “transparent and fair” criminal enforcement program that balances the importance of monitors in ensuring corporate compliance with criminal resolutions while minimizing unnecessary burdens on businesses. Ultimately, the Memorandum refines previous policies’ selection and implementation processes and focuses on minimizing costs and burdens on businesses, while removing language related to diversity and inclusion.
Deeming Corporate Monitors Necessary
The Memorandum acknowledges that monitors can be an “effective resource” to reduce the risk of recidivism, yet they can also “impose substantial expense and interfere with lawful business operations.” As such, the Memorandum emphasizes that monitors should not be imposed for punitive purposes. Reiterating the Morford Memorandum’s guidance, the Memorandum instructs prosecutors to consider “(1) the potential benefits that employing a monitor may have for the corporation and the public, and (2) the cost of a monitor and its impact on the operations of a corporation.”
Regarding the first factor, the Memorandum instructs prosecutors to “balance [] the need to ensure effective compliance programs with the need to eliminate unnecessary burden,” including the following factors:
These factors emphasize an evaluation of conduct that implicates “national security” interests—such as those outlined in the Enforcement Memorandum priorities—and the importance of regular testing and updating of internal compliance programs. If a company’s conduct does not “significantly impact U.S. interests,” is regulated by other governmental bodies, is remediated, or has a mature internal compliance program, a monitor may be inappropriate.
Ensuring Narrowly Tailored Monitorships
The Memorandum provides three factors to ensure that monitorships are “appropriately tailored and focused.” In line with an emphasis on financial considerations and efficiency, it outlines detailed guidance on cost considerations and necessary communication when selecting and implementing monitors.
This represents a significant change to the cadence of the process, wherein historically monitors were rarely, if ever, reined in as to associated costs, with companies being cautious of raising complaints as to cost and the government hesitant to interfere. With the issuance of the Memorandum, what some have referred to in the past as an essential “blank check” for the monitor and their counsel is no longer.
First, a monitor’s costs should be proportionate to (1) the severity of the underlying criminal conduct, (2) the profits of the relevant corporate entity engaged in misconduct, and (3) the company’s present size and risk profile. Monitors are required to take all reasonable steps to minimize their costs. The Memorandum imposes new requirements on the monitor consisting of hourly rates caps and budget submission to the Criminal Division and company at each phase of work.
Second, the Memorandum mandates regular (at least biannual) tripartite meetings between the company, monitor, and the Criminal Division to ensure alignment and prevent overreach.
Third, the Memorandum notes that monitorships should be a “collaborative” effort to achieve a “single goal” of “an appropriately tailored and effective, risk-based corporate compliance program designed to detect and prevent the recurrence of the misconduct underlying the agreement.” In contrast to Biden-era policy updates that took a more neutral or even positive tone to monitorships, here the Memorandum explicitly states that if a monitorship is implemented it was because “there was a demonstrated need for and benefit to be derived from the monitorship that outweighed the costs and burden.”
Selecting and Approving Monitors
The Memorandum retains the previous practice of a Standing Committee on the Selecting of Monitors and the necessary approvals needed from supervisors, the assistant attorney general, and the Office of the Deputy Attorney General.
Agreements requiring a monitor (e.g., DPA, NPA, plea agreement) must include specific terms that speak to, among other factors, the monitor’s qualifications, selection process, responsibilities, length of term, and budget.
Lastly, the Memorandum maintains the status quo in identifying potential monitors, by corporate counsel who are directed to recommend a pool of three to five qualified monitor candidates. Significantly, as it relates to the process, the Memorandum removes the Polite Memorandum’s commitment to “diversity and inclusion,” stating that a monitor recommendation must be made “without unlawful discrimination against any person or class of persons,” in what could be a return to past years where the makeup of the pool and ultimate class of monitors selected is best described as homogenous.
Together, the Enforcement Memorandum and Memorandum clarify the Criminal Division’s focus on cost and efficiency in imposing corporate monitors and ensuring that a monitor’s role is appropriately tailored in mandate and scope.
While the Memorandum retains many of the historical policies’ key processes as to monitor imposition and selection, it contains notable changes related to (1) requiring cost and budget limitations, (2) removing diversity, equity, and inclusion language in monitor selection, and (3) mandating open dialogue and collaboration through regular meetings with the company, monitor, and Criminal Division. These differences reflect a shift in focus to financial oversight and communication, rather than inclusivity in the monitor selection process.
In the future, companies may have strong arguments to avoid a corporate monitor where they remain attuned to self-disclosure and/or voluntary remediation, face existing governmental regulation in the United States or abroad, test and update their mature compliance policies, and emphasize their actions do not fall within US “national security interests.” Companies also may have a greater role in recommending and choosing monitors.
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Author Sandra Moser is a former Chief of the US Department of Justice, Criminal Division, Fraud Section, and in that role served on the standing committee for the selection of monitors. She co-chairs the Monitor/Receiver Committee for the Women’s White Collar Defense Association.
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[1] DOJ Announces New Corporate Enforcement Policies (May 13, 2025); President Trump Issues Executive Order Temporarily Pausing FCPA Enforcement (Feb. 12, 2025); Newly Confirmed AG Pam Bondi Issues Directive Limiting Scope of FCPA Enforcement (Feb. 6, 2025).
[2] See Deputy Attorney General Lisa O. Monaco Gives Keynote Address at ABA’s 36th National Institute on White Collar Crime (Oct. 28, 2021) (“I am making clear that the department is free to require the imposition of independent monitors whenever it is appropriate to do so in order to satisfy our prosecutors that a company is living up to its compliance and disclosure obligations under the DPA or NPA.”); Polite Memorandum (Mar. 1, 2023) (clarifying that “prosecutors should not apply presumptions for or against monitors” and providing 10 nonexhaustive factors to assist in making such decisions).