White House details new "white-collar enforcement plan" to combat financial fraud

The White House on Monday released details about its revised Corporate Enforcement Policy (CEP) – enticing companies to voluntarily self-report financial fraud in exchange for a 75% reduction in fines and burdensome government oversight.

Head of the US Justice Department’s (DoJ) Criminal Division Matthew R. Galeotti spoke of the revamped policy at SIFMA’s ninth annual Anti-Money Laundering and Financial Crimes Conference held in Washington, DC.

The Securities Industry and Financial Markets Association, or SIFMA, advocates for the nation’s securities industry, representing securities firms, banks, and asset management companies.

Monday’s informational release specifically refers to new changes in the “Fraud Section and the Money Laundering and Asset Recovery Section” of the Criminal Division Corporate Enforcement and Voluntary Self-Disclosure Policy (CEP).

“White-collar crime poses a significant threat to US interests,” Galeotti said in his introductory remarks. “Illicit financial and logistical networks undermine our national security by facilitating sanctions evasion by hostile nation-states and terror regimes,” he said.

The policy changes aim to reduce the burdens on businesses, which the DoJ chief says “have been subjected to costly, unchecked, and long-running investigations” that not only deter companies from working with the Criminal Division to root out financial fraud but also divert resources from the department itself.

Fraud perpetrated through Chinese variable interest entities 9VIEs), as well as financial scams such as Ponzi schemes, investment fraud, elder fraud, market manipulation, and others, take advantage of American investors and consumers, especially the most vulnerable, the DoJ policy states.

Key CEP revisions

Key revisions applied to the CEP include: voluntary self-disclosure and prioritizing investigations; oversight and monitoring selection; and the DoJ’s corporate whistleblower program.

“Most corporations and financial institutions want to play by the rules and provide value for their shareholders and their customers," Galeoitti said, adding, “that is what we want them to remain focused on.”

The most significant change and one that offers "the most generous benefits" under the new white collar enforcement is the push for companies to voluntarily self-disclose.

Companies that voluntarily self-disclose and meet certain criteria, including full cooperation, timely and appropriate remediation, and have no aggravating circumstances, will automatically "receive declination," meaning the company will not be required to enter into a criminal resolution with the DoJ.

Part of the Non-Prosecutorial Agreement (NPA) in the declination would ensure no monitoring and a 75% reduction in financial fines imposed by the DoJ.

“Excessive enforcement and unfocused corporate investigations stymie innovation, limits prosperity, and reduces efficiency,” for both the companies and the department," Galeoitti explained.

When it comes to prioritizing investigations, mitigation, and monitoring, the DoJ said it will take into consideration the “nature and seriousness of the conduct” as well as the future risk of repeat offenses.

“The Criminal Division will ensure that [monitoring] costs are proportionate with the underlying criminal conduct, the company’s profits, and the company’s size and risk profile,” Galeotti said.

For example, companies, which must bear the cost of monitoring agents, will benefit more by using those funds to implement proper compliance measures, the policy states.

In addition to oversight policy changes for new cases, the agency said it will review the level of monitoring currently established for previous cases, and in some instances, eliminate monitoring altogether for certain companies.

Finally, the Corporate Whistleblower Awards Pilot Program has added several more priority areas for reporting “tips” to the DoJ, including:

• Procurement and federal program fraud
• Trade, tariff, and customs fraud
• Violations of federal immigration law
• Violations involving sanctions
• Material support of foreign terrorist organizations, cartels, and transnational criminal organizations, (ie. money laundering, narcotics, and Controlled Substances Act)

As an incentive, the Pilot Program will financially award whistleblowers who come forward to report corporate misconduct, as long as the submission “results in a successful prosecution that includes criminal or civil forfeiture,” the policy states.

Furthermore, if a company comes forward within 120 days of a whistleblower complaint, the DoJ may decline to prosecute.

Many tenets in the revised CEP policy were initially announced on May 12th, 2025.