The Organizational Sentencing Guidelines: Thirty Years of Innovation and Influence

Charles R. Breyer

Acting Chair

Patricia K. Cushwa

Ex Ofcio

Jonathan J. Wroblewski

Ex Ofcio

Kenneth P. Cohen

Staff Director

Glenn R. Schmitt

Director

Ofce of Research and Data

August 2022

United States Sentencing Commission

One Columbus Circle, N.E.

Washington, DC 20002

www.ussc.gov

Kathleen C. Grilli, J.D.

General Counsel

Kevin T. Maass, M.A.

Research Associate

Charles S. Ray, J.D.

Assistant General Counsel

TABLE OF CONTENTS

INTRODUCTION

KEY FINDINGS

CHAPTER 1: THE SENTENCING REFORM ACT AND ITS STATUTORY

MANDATE TO DEVELOP ORGANIZATIONAL GUIDELINES

CHAPTER 2: ORGANIZATIONAL SENTENCING DATA

CHAPTER 3: INFLUENCE OF THE ORGANIZATIONAL SENTENCING

GUIDELINES

CONCLUSION

APPENDICES

ENDNOTES

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

INTRODUCTION

As ultimately promulgated in

1991, the guidelines in Chapter Eight

of the Guidelines Manual represented

a collaborative process between the

United States Sentencing Commission

("Commission"), federal agencies,

businesses, industry advocacy groups,

academia, and many other stakeholders.

The organizational guidelines reect a set

of principles identied during this process

and incorporated into the guidelines to

achieve the goals of the Sentencing Reform

Act of 1984 ("SRA") and address the

concerns raised by Congress. Although

initially resisted by some commentators,

the organizational guidelines have since

been embraced for their innovative

approach to organizational sentencing: (1)

incentivizing organizations to self-police

their behavior; (2)providing guidance on

effective compliance and ethics programs

that organizations can implement to

demonstrate efforts to self-police; and

(3)holding organizations accountable

based on specic factors of culpability.

The organizational sentencing

guidelines have wielded signicant

inuence on corporate America. Chapter

Eight was designed to incentivize corporate

self-policing through its "carrot and stick"

philosophy

and it has "catalyzed vigorous

efforts by companies to promote ethical

performance and reduce organizational

misconduct."

Thirty years have elapsed

since their original promulgation and the

hallmarks for an effective compliance and

ethics program found in the guidelines

continue to set the gold standard for

designing and evaluating effective

compliance and ethics programs.

This publication summarizes the

history of Chapter Eight's development

and discusses the two substantive changes

made to the elements of an effective

compliance and ethics program. It then

provides policymakers and researchers

a snapshot of corporate sentencing over

the last 30 years. Finally, the publication

describes Chapter Eight's impact beyond

federal sentencing.

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

KEY FINDINGS

United States Sentencing Commission

The major innovations of the

organizational guidelines are

(1) incentivizing organizations

to self-police their behavior; (2)

providing guidance on effective

compliance and ethics programs

that organizations can implement to

demonstrate efforts to self-police; and

(3)holding organizations accountable

based on specic factors of culpability.

The most signicant

achievement of Chapter Eight

has been the widespread

acceptance of the organizational

guidelines' criteria for developing and

maintaining effective compliance and

ethics programs to prevent, detect, and

report criminal conduct.

During the 30-year period

since promulgation of the

organizational guidelines,

4,946 organizational offenders have

been sentenced in the 94 federal

judicial districts. The majority of

organizational offenders are domestic

(88.1%), private (92.2%), and smaller

organizations with fewer than 50

employees (70.4%).

Six offense types accounted

for 80.4 percent of all

organizational offenders from

scal years 1992 through 2021.

• Fraud (30.1%) and environmental

(24.0%) offenses, accounted

for more than half (54.1%) of all

organizational offenses.

• Other common offense types were

antitrust (8.4%), food and drug

(6.6%), money laundering (6.1%),

and import and export crimes (5.2%).

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

Commission data suggests

that the lack of an effective

compliance and ethics program

may be a contributing factor to criminal

prosecutions against organizations.

• Since scal year 1992, the

overwhelming majority of

organizational offenders (89.6%) did

not have any compliance and ethics

program.

• Only 11 of the 4,946 organizational

offenders sentenced since scal year

1992 received a culpability score

reduction for having an effective

compliance and ethics program.

• More than half (58.3%) of the

organizational offenders sentenced

under the ne guidelines received

a culpability score increase for

the involvement in or tolerance of

criminal activity.

• Few organizational offenders (1.5%

overall) received the ve-point

culpability score reduction for

disclosing the offense to appropriate

authorities prior to a government

investigation in addition to their

full cooperation and acceptance of

responsibility.

• Since scal year 2000, courts

ordered one-fth (19.5%) of

organizational offenders to

implement an effective compliance

and ethics program.

Since scal year 1992,

the courts have imposed

nearly $33 billion in nes on

organizational offenders. The average

ne imposed was over $9 million and

the median amount was $100,000.

Since scal year 1992, courts

sentenced over two-thirds

of organizational offenders

(69.1%) to a term of probation and the

average length of the term of probation

imposed was 39 months.

CHAPTER ONE

United States Sentencing Commission

T S R A   S M 

D O G

One of the primary motivations for

the SRA was to eliminate unwarranted

disparity in sentencing and to address

the inequalities created by unfettered

sentencing discretion.

While much of

the Congressional concern focused on

individual sentencing, the Senate report

accompanying the SRA also detailed

Congress's observations regarding the

sentencing of organizations. It stated that

The Senate report also noted concerns

that white collar criminals were being

sentenced to minimal nes, creating "the

impression that certain offenses are

punishable only by a small ne that can be

written off as a cost of doing business."

As part of the SRA, Congress created

the Commission as an independent

agency within the judicial branch of the

federal government and tasked it with

the responsibility of developing federal

sentencing policy.

The SRA directed the

Commission to promulgate guidelines

that federal judges would use for selecting

sentences within the prescribed statutory

range.

The SRA also specied that an

organization

may be sentenced to a term

of probation

or a ne, or a combination

of these sanctions,

and required that

"[a]t least one of such sentences must be

imposed."

Additionally, the SRA made

clear that an organization could "be made

subject to an order of criminal forfeiture,

an order of notice to victims, or an order of

restitution."

[c]urrent law . . . rarely

distinguishes between

individuals and organizations for

sentencing purposes[;] [t]hus,

present law fails to recognize

the usual differences in the

nancial resources of these two

categories of defendants and

fails to take into account the

greater nancial harm to victims

and the greater nancial gain to

the criminal that characterizes

offenses typically perpetrated by

organizations.

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

H   O G

On October 1, 1986, the Commission

published in the Federal Register the

Preliminary Draft of the Sentencing

Guidelines.

This draft laid out two

possible approaches to the development of

organizational sanctions based on the just

punishment and deterrence philosophies.

The just punishment approach emphasized

an organization's culpability

and its

ability to pay a ne, while the deterrence

approach focused on the harmfulness of an

organization's conduct and the likelihood

of detection of the crime.

Noting the

competing concerns raised by the just

punishment and deterrence purposes,

the Commission sought public comment

on "whether its approach to nes should

emphasize the organization's culpability

and ability to pay, or the harmfulness of its

conduct and the likelihood of detection."

The Commission also identied the

mandatory and discretionary conditions

of probation authorized by statute,

and it sought comment about the types

of probation conditions that might be

imposed on an organization and the

circumstances justifying their imposition.

Original Organizational Guidelines

Consistent with its statutory mandate

and the observations of Congress,

the Commission began exploration of

guidelines for use by federal courts to

sentence organizations convicted of

a federal offense. The initial Chapter

Eight organizational guidelines were the

product of an extensive multiyear process

conducted by the Commission.

The

Commission held its rst public hearing

devoted exclusively to consideration of

organizational sanctions in June 1986

and continued to solicit and consider

public comment from many stakeholders,

including from the U.S. Departments

of Justice ("DOJ"), Treasury, Defense,

Education, Health and Human Services,

Interior, and Labor, the Federal Deposit

Insurance Corporation, the U.S. Postal

Service, and the U.S. Securities and

Exchange Commission ("SEC") about

offenses occurring within their areas of

responsibility.

United States Sentencing Commission

Because of the complexity of the

subject matter and tight deadlines imposed

by the SRA,

the Commission deferred

action on the organizational guidelines until

completion of the guidelines for individual

defendants.

Shortly after delivery of

the rst Guidelines Manual to Congress,

the Commission turned its attention back

to corporate sanctions. In July 1988, the

Commission published the Discussion

Materials on Organizational Sanctions to

gather comment and analysis on the

development of sentencing standards

for organizations.

Those materials

included a Commission staff working

paper on organizational sentencing policy

recognizing that "[t]he key to an effective

organizational sentencing system lies in

selecting penalty rules that will provide

organizations with the most desirable

incentives for their compliance efforts."

Two Commission hearings followed

the release of the Discussion Materials on

Organizational Sanctions.

Witnesses,

including representatives from the

President's Council of Economic Advisers,

staff from the SEC, Environmental

Protection Agency ("EPA"), Food and Drug

Administration, the U.S. Probation Ofce,

the Institutional Shareholders Services,

academics, and others,

testied on the

importance of internal corporate controls

as a means of deterring organizational

crime and supported involving the

organization in the development of a

compliance plan.

During these hearings

the discussion of compliance programs as a

mitigating factor rst arose,

an idea that

attracted the Commission's interest.

In 1988, the Commission formed a

working group of private defense attorneys

to develop a set of practical principles for

sentencing organizations.

In its May

1989 report, Recommendations Regarding

Criminal Penalties for Organizations,

the working group asserted that

organizational sanctions should serve dual

purposes: punishment and deterrence by

incentivizing organizations to take steps to

prevent crimes.

The report also identied

a number of factors that should ameliorate

the criminal ne amount.

On November 8, 1989, the Commission

published for public comment a set of

proposed organizational sentencing

guidelines as a new chapter to the

Guidelines Manual: Chapter Eight—Sentencing

of Organizations that provided for ne

reductions for compliance efforts in

certain circumstances.

The Commission

held public hearings on the published

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

proposed guidelines.

Witnesses from a

broad spectrum of special interest groups,

including the National Association of

Manufacturers, the American Corporate

Counsel Association, the U.S. Chamber

of Commerce, and the American

Bar Association ("ABA"), along with

representatives from federal agencies,

academics, and the general counsels of

various private businesses, testied about

the elements of successful compliance

programs, among other subjects.

Ultimately, the Commission came to the

consensus that staff should develop draft

guidelines to reect self-policing through

economic incentives as an alternative to

the previous draft guidelines.

Although the Commission

had anticipated promulgating the

organizational guidelines at its meeting

on April 10, 1990, the matter was

deferred until after the appointment

of new members.

Once three new

commissioners were sworn in on July

24, 1990, the now fully constituted

Commission agreed on a set of general

principles to be used in drafting guidelines

on organizational sanctions.

These

principles included incentives for

organizations to minimize the likelihood

of criminal behavior and ensure that, if

detected, such wrongdoing would be

reported by the organizations.

On November 5, 1990, the Commission

published for comment proposed

organizational guidelines.

The draft

dened the requirements of an effective

compliance program, making clear that the

hallmark of such programs is the exercise

of the organization's due diligence to

prevent and detect criminal conduct by

its agents, and recognized such programs

as a mitigating factor for a ne reduction

of the applicable ne range. The draft

also provided that an organization would

not ordinarily qualify for the effective

compliance program mitigating factor

unless it also qualied for the mitigating

factor, which required that no compliance

personnel or person with substantial

managerial authority knew about the

violation.

On December 13, 1990, the

Commission held a nal public hearing

on the organizational guidelines.

The

witnesses generally favored including an

effective compliance program as one of the

mitigating factors and believed that giving

credit for an effective compliance program

would deter future criminal activity.

Several witnesses expressed the view

United States Sentencing Commission

that the Commission correctly identied

the essential elements of an effective

compliance program in the published

commentary.

After further renement to the

published draft, the Commission

unanimously voted to promulgate the

organizational guidelines and submit

them to Congress for a 180-day review

period.

The newly promulgated Chapter

Eight, titled "Sentencing of Organizations,"

took effect on November 1, 1991.

The

Commission expressed the aspiration

that "organizations would come to view

this guideline scheme as a powerful

nancial reason for instituting effective

internal compliance programs that, in

turn, would minimize the likelihood that

the organization would run afoul of the

law in the rst instance."

Moreover, if

a corporate crime was committed, "the

sentencing guideline incentives would

drive the corporate actor toward swift and

effective disclosure and other remedial

actions."

General Principles Embodied in

Chapter Eight of the Guidelines

Manual

The Chapter Eight guidelines and

policy statements reect several general

principles relating to the sentencing

of organizations. The guidelines are

"designed so that the sanctions imposed

upon organizations and their agents, taken

together, will provide just punishment,

adequate deterrence, and incentives

for organizations to maintain internal

mechanisms for preventing, detecting,

and reporting criminal conduct."

"First,

the court must, whenever practicable,

order the organization to remedy any

harm caused by the offense . . . as a means

of making victims whole for the harm

caused."

Second, any organization that

operated primarily for a criminal purpose

or by criminal means should receive a ne

sufciently high to divest the organization

of all its assets.

"Third, the ne range for

any other organization should be based

on the seriousness of the offense and the

culpability of the organization."

"The

seriousness of the offense generally will be

reected by the greatest of the pecuniary

gain, the pecuniary loss, or the amount

in a guideline offense level ne table."

"Culpability generally will be determined by

six factors that the sentencing court must

consider."

The four aggravating factors

are: "(i) the involvement in or tolerance

of criminal activity; (ii) the prior history

of the organization; (iii) the violation

of an order; and (iv) the obstruction of

justice."

"The two factors that mitigate

the ultimate punishment of an organization

are: (i) the existence of an effective

The guidelines are "designed so

that the sanctions imposed upon

organizations and their agents,

taken together, will provide just

punishment, adequate deterrence,

and incentives for organizations

to maintain internal mechanisms

for preventing, detecting, and

reporting criminal conduct."

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

compliance and ethics program; and (ii)

self-reporting, cooperation, or acceptance

of responsibility."

Finally, probation is an

appropriate sentence for an organization

"when needed to ensure that another

sanction will be fully implemented, or to

ensure that steps will be taken within the

organization to reduce the likelihood of

future criminal conduct."

Evolution of Chapter Eight

The structure of Chapter Eight and

its general principles have remained

largely unchanged since its original

promulgation. Nevertheless, after initial

promulgation, commentators offered

suggestions for amendments to Chapter

Eight.

After the President nominated

and the Senate conrmed seven new

commissioners in 1999, the Commission

developed an interest in re-examining

Chapter Eight.

Judge Diana E. Murphy,

the new Commission Chair, and the

other commissioners "became aware

of the wide impact the [organizational]

[g]uidelines have on organizations . . .

extend[ing] far beyond their use in the

context of criminal cases."

Under Chair

Murphy, the Commission began to consider

whether ethics was "an implicit component

of effective compliance programs, or

whether ethics should now explicitly be

incorporated into the compliance program

criteria in the organizational guidelines."

In 2001, in light of the public comment

it received regarding the organizational

guidelines, the Commission solicited

public input on the formation of an ad hoc

advisory group to identify any changes

needed to improve their operation.

Informed by the response, the Commission,

on February 21, 2002, formed an ad hoc

advisory group to review the organizational

guidelines with particular emphasis on

examining the criteria for an effective

program to ensure compliance with the

law by an organization.

The 15-member

group was composed of industry

representatives, scholars, and experts in

compliance and business ethics.

Five months after the Commission

created the advisory group, Congress

enacted the Sarbanes-Oxley Act of 2002.

Section 805 of the Sarbanes-Oxley Act

directed the Commission to "review

and amend, as appropriate, the Federal

Sentencing Guidelines and related policy

statements to ensure that . . . the guidelines

that apply to organizations in United

States Sentencing Guidelines, [C]hapter

[Eight], are sufcient to deter and punish

organizational criminal misconduct."

The

Commission used the advisory group's

work to inform its response to that

directive.

The advisory group sought public

comment on the organizational guidelines

and identied its primary focus on the

criteria for an effective compliance

program and how those criteria affected

the operation of Chapter Eight as a whole.

The advisory group received signicant

United States Sentencing Commission

public interest to both its initial and a

subsequent request for comment.

public hearing on November 14, 2002, with

testimony from witnesses with a broad

range of perspectives, further informed the

advisory group's work.

On October 7, 2003, the advisory

group presented a comprehensive report

to the Commission on possible changes

to the organizational guidelines.

The

report concluded that the organizational

sentencing guidelines were successful

in encouraging organizations to develop

compliance programs to prevent and

detect wrongdoing, but recommended

greater guidance regarding the factors

for an effective program.

Specically, the

advisory group recommended that the

Commission promulgate a stand-alone

guideline dening effective compliance

programs and make changes to the

denitions and requirements of such

programs.

Informed by the public comment

and

hearing testimony,

the Commission on

April 8, 2004, unanimously promulgated

an amendment that elevated the criteria

for an effective compliance program

from commentary into a separate

guideline, §8B2.1 (Effective Compliance

and Ethics Program).

The amendment

also strengthened the existing criteria

by, for example, requiring organizations

to establish standards and procedures

to prevent and detect criminal conduct,

more precisely dening the oversight

responsibilities of the organization's

governing authority, and making

compliance and ethics training a

requirement, specically extending the

training requirement to the upper levels

of an organization.

The amendment

added a requirement to conduct periodic

risk assessments as a condition of

probation.

The amendment also added

the requirement that organizations

"otherwise promote an organizational

culture that encourages ethical conduct

and a commitment to compliance with the

law."

The Commission also took steps to

address concerns regarding the lack of

incentives for small organizations to

develop compliance programs.

First,

the Commission provided additional

guidance regarding the implementation of

compliance and ethics programs by small

organizations.

Next, the commentary

T   O G

Initial Promulgation

Oct. 1986

Nov. 1989

Nov. 1990

Nov. 1991

Preliminary draft of

Guidelines solicits comment

on organizational sanctions

Publication of proposed

Organizational Guidelines

Chapter Eight became

effective

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

encouraged larger organizations to

promote the adoption of compliance and

ethics programs by smaller organizations

with which they conducted business.

The

Commission also replaced the automatic

preclusion for compliance program credit

provided at §8C2.5(f) with a rebuttable

presumption to allow smaller organizations

to argue for a culpability score reduction

based upon an effective compliance

and ethics program.

The amended

organizational guidelines became effective

on November 1, 2004.

The Commission considered

further changes during the 2009–2010

amendment cycle. Mindful of the fact

that "even modest changes to the

Guidelines can have a huge impact on the

compliance and ethics activities in virtually

every organization,"

the Commission

actively solicited input on the proposed

amendment

from groups known to have

an interest in Chapter Eight. As a result,

the Chapter Eight proposed amendment

received more public comment than any

other proposed amendment in 2010.

Commentators included government

agencies, including the Departments

of Health and Human Services, and

Commerce,

the Commission's standing

advisory groups,

ethics and compliance

industry professionals, for example, the

Society of Corporate Compliance and

Ethics ("SCCE"), the Ethics and Compliance

Ofcers Association, and the Ethisphere

Institute,

and non-prot research

organizations, such as the Ethics Resource

Center and Washington Legal Foundation.

After considering the voluminous

comments

and hearing testimony,

the

Commission expanded the scope of the

culpability score reduction at §8C2.5(f)

to make it available to organizations of all

sizes and claried certain requirements

needed for an effective compliance and

ethics program.

The amendment also

added an application note describing the

"direct reporting obligations" necessary

to meet the rst criterion under §8C2.5(f)

(3)(C) and provided encouragement, by

means of potential sentence mitigation, for

organizations to adopt "compliance and

ethics policies that provide operational

compliance personnel with access to the

governing authority when necessary."

The amended organizational guidelines

became effective on November 1, 2010.

Amendments

July 2002

Nov. 2004

Nov. 2010

Sarbanes-Oxley Act to review

and amend Chapter Eight

Amendments to Chapter Eight

elevating and strengthening the

criteria for an effective compliance

program become effective

Amendment to §8B2.1

became effective

United States Sentencing Commission

CHAPTER TWO

O S D

Introduction

Because criminal prosecutions resulting

in a sentencing are only one method by

which an organization's violations of the

law can be addressed by the authorities,

100

Commission sentencing data cannot fully

measure the prevalence of corporate

crime.

101

Nevertheless, by providing a

snapshot of organizational offenders

and offenses, this data may inform

policymakers and researchers regarding

the trends in corporate sentencing and

may also contribute to the continuing

dialogue about the importance of effective

compliance and ethics programs and

identify areas for further renement in

existing programs.

Methodology

The Commission's organizational

datale consists of information about

organizations that have been convicted and

sentenced for a federal criminal offense.

102

From the court documents submitted, the

Commission collects information including

company demographic information (e.g.,

size, business classication), guideline

application, and the details of the sentence

such as nes and restitution. This report

provides information on organizational

offenders sentenced between scal year

1992 and scal year 2021. However,

because the process to collect this data has

changed over this time, not all analyses can

be presented for the entire period.

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

Organizational Offenders

During the 30-year period since

promulgation of the organizational

guidelines, 4,946 organizational offenders

have been sentenced in the 94 federal

judicial districts.

103

This compares to nearly

two million individual federal offenders

sentenced within the same period.

104

The Commission observed a fairly

steady increase in the number of

organizational offenders from scal year

1992 to scal year 2000. As demonstrated

in Figure 1, courts sentenced 18

organizational offenders in scal year

1992, compared to a high of 304 offenders

in scal year 2000. From this peak in scal

year 2000, the number of organizational

offenders has gradually declined to below

100 in the most recent two scal years.

Organizational offenders represent a

small proportion of all federal offenders

(0.2% in scal year 2021). Although

organizational offenders have sentencing

trends distinct from those of individual

offenders, the Commission has also

observed a decline in the number of

individual offenders sentenced since the

reported high in scal year 2011 through

the current scal year.

105

104

120

162

222

220

255

304

238

252

200

130

187

217

197

199

177

149

160

187

172

162

181

132

131

118

Figure 1. Number of Organizational Offenders

Fiscal Years 1992–2021

United States Sentencing Commission

In scal year 2000, the Commission

expanded its data collection to record

whether an organization was a domestic

or foreign organization. The majority

of organizational offenders (88.1%) are

domestic organizations. The highest

Figure 2. Percentage of Domestic Organizational Offenders

Fiscal Years 2000–2021

percentage of domestic organizations was

reported in scal year 2001 (96.2%) (Figure

2). Since then, the proportion of domestic

organizations has been gradually declining,

with the lowest rate (78.1%) reported in

scal year 2017.

96.0%

96.2%

93.6%

91.1%

91.8%

91.4%

95.3%

92.9%

90.6% 90.6%

81.0%

88.4%

84.4%

82.4%

82.1%

78.3%

81.8%

78.1%

81.8%

78.7%

81.5%

82.2%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

Ownership Structure

The Commission also collects

information about the ownership structure

of organizational offenders. Although the

Commission has revised the categories

of ownership structure of organizational

offenders over time,

106

these ownership

structures can be grouped within the

following ve broad categories: private

organization,

107

public organization,

108

non-prot organization,

109

governmental

organization,

110

and other organization.

111

The overwhelming majority of

organizations were private organizations

(92.2%) (Figure 3). The next most common

ownership structure was the public

organization (4.8%).

Figure 3. Ownership Structure of Organizational Offenders

Fiscal Years 1992–2021

Private

Organization

92.2%

Public Org

4.8%

Non-Profit

Org

0.8%

Gov't Org

0.6%

Other Org

1.6%

United States Sentencing Commission

Size of Organization

The majority (70.4%) of organizational

offenders sentenced are smaller

organizations with fewer than 50

employees (Figure 4). Organizations with

50-to-99 employees (9.4%) and 100-to-

Figure 4. Size of Organizational Offenders

Fiscal Years 1992–2021

< 50 Employees

70.4%

50-99 Employees

9.4%

100-499 Employees

12.1%

500-999 Employees

1.7%

≥ 1000 Employees

6.4%

499 employees (12.1%) were the next most

common organizational sizes. Less than ten

percent (8.1%) of organizations had greater

than 500 employees.

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

Financial Status at Sentencing

The criminal prosecution and

sentencing of an organization may

impact its nancial status. The stigma

of a criminal conviction may drive away

an existing or potential customer base,

thereby threatening the organization's

ability to survive. Moreover, organizational

sentences typically include monetary

sanctions, such as restitution and nes.

These monetary sanctions may cause

additional nancial stress to an already

vulnerable organization. To understand

these effects, the Commission collects data

on the organization's nancial status at the

time of sentencing.

With few exceptions, the majority

(64.5%) of organizations sentenced each

scal year remained solvent and operating

at the time of sentencing (Figure 5).

However, approximately 30 percent were

either defunct (17.6%) or in nancial stress

(13.0%) at the time of sentencing.

Figure 5. Financial Status of Organizational Offenders

Fiscal Years 1992–2021

Defunct

17.6%

Solvent

64.5%

Bankrupt

(Ch. 7)

0.7%

Reorganization

(Ch. 11)

1.2%

Financial Stress

13.0%

Other

3.0%

United States Sentencing Commission

Offense and Industry Types

The Commission classies 24

organizational offense types. Six offense

types accounted for 80.4 percent of

all organizational offenders from scal

years 1992 through 2021

(Figure 6). Two

Figure 6. Offense Type of Organizational Offenders

Fiscal Years 1992–2021

30.1%

24.0%

8.4%

6.6%

6.1%

5.2%

3.4%

2.8%

2.6%

2.3%

8.6%

Fraud

Environmental

Antitrust

Food, Drugs, Agricultural

& Consumer Products

Money Laundering

Import and Export

Tax

Bribery/Gratuity/ Extortion

Drugs

Immigration

Other

NOTE: "Other" Offense Type includes: Administration of Justice, Larceny/Theft/Embezzlement, Copyright/Trademark,

Firearms, Racketeering/Extortion, Gambling, Contraband, Obscenity, Civil Rights, Food Stamps, Motor Vehicle,

Archeological Damage, Forgery, and Other Offenses.

of these offense types, fraud (30.1%)

and environmental (24.0%) offenses,

accounted for more than half (54.1%) of all

organizational offenses. Other common

offense types were antitrust (8.4%), food

and drug (6.6%), money laundering (6.1%),

and import and export crimes (5.2%).

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

During the 30-year period that the

Commission has collected organizational

sentencing data, it has observed several

notable changes relating to offense type.

For example, during the rst two years

of data collection, few organizational

offenders were sentenced and in these

initial years, antitrust was the most

common offense type observed (Figure 7).

Notably, the Commission included a special

instruction about antitrust organizational

nes in the original guidelines, even before

promulgation of Chapter Eight.

112

The Commission observed a change

in offense types in scal year 1994, when

antitrust was overtaken by fraud as the

most common offense type. From scal

year 1994 through scal year 2010, fraud

continued to be the most common offense

type. That pattern changed in scal year

2005, when the number of environmental

offenses equaled fraud offenses. Since

then, environmental offenses have

replaced fraud as the most common offense

type during several different scal years in

the past decade.

Figure 7. Offense Type of Organizational Offenders

Fiscal Years 1992–2021

5.6%

22.2%

0.0%

25.6%

77.8%

4.4%

Fraud Environmental Antitrust

NOTE: Markers and percentages indicate highest offense type in FY.

United States Sentencing Commission

Beginning in scal year 2000, the

Commission began collecting information

on the industry in which organizational

offenders were doing business. Of the

13 industry categories

113

identied by

the Commission, manufacturing (19.6%),

health care services (14.0%), and retail

Figure 8. Industry Type of Organizational Offenders

Fiscal Years 2000–2021

trade (13.5%) organizations were the

most common industries (Figure 8).

Other common industries included the

transportation (11.9%) and services

(11.1%) industries. These ve industry

categories accounted for 70.1 percent of all

organizational offenders from scal years

2000 through 2021.

19.6%

14.0%

13.5%

11.9%

11.1%

6.7%

6.2%

5.9%

5.1%

6.1%

Manufacturing

Health Care Services

Retail Trade

Transportation

Services

Construction

Finance

Agriculture

Environmental Management

Other

NOTE: "Other" Industry Type includes: Mining, Organizations, Associations, Charities, Public Administration, and

Other Industries.

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

Although the most common offense

type in the 13 industries varied between

environmental and fraud offenses,

114

certain offense types were more commonly

associated with certain industries

(Figure 9). For example, environmental

offenses were the most common in the

Figure 9. Top Five Offense Types of Organizational Offenders by Industry

Fiscal Years 2000–2021

manufacturing, transportation, agricultural,

environmental management, mining, and

public administration industries. Fraud

offenses were most common in the

health care services, retail trade, services,

construction, and nance industries.

Manufacturing (n=694) 18.1% 24.9% 9.3% 22.0% 2.5%

Health Care Services (n=493) 0.8% 0.8% 1.8% 54.0% 3.3%

Retail Trade (n=478) 3.6% 9.0% 13.6% 17.0% 15.1%

Transportation (n=419) 15.3% 47.7% 5.5% 20.1% 0.7%

Services (n=391) 4.1% 16.1% 4.1% 32.7% 8.7%

Construction (n=237) 4.2% 26.6% 0.4% 39.2% 5.1%

Finance (n=219) 4.1% 11.0% 1.4% 47.0% 18.7%

Agriculture (n=207) 0.5% 54.1% 5.8% 14.0% 1.5%

Enviro Management (n=179) 2.2% 66.5% 0.6% 21.8% 1.1%

Mining (n=73) 1.4% 46.6% 4.1% 21.9% 1.4%

Orgs, Ass'ns, Charities (n=23) 0.0% 8.7% 8.7% 17.4% 21.7%

Public Admin (n=21) 4.8% 57.1% 9.5% 23.8% 0.0%

Other (n=98) 4.1% 19.4% 10.2% 26.5% 14.3%

Fraud

Money

Laundering

Antitrust

Environment

Import and

Export

These basic metrics may help inform

businesses in certain industry sectors of

areas to prioritize when to "periodically

assess the risk of criminal conduct"

and "take appropriate steps to design,

implement, or modify" its compliance and

ethics program to reduce the risk of the

criminal conduct identied.

115

For example,

as noted above, the data demonstrates

that health care service organizations

were most commonly sentenced for fraud

offenses (54.0%). As such, a company

operating in the health care sector may

wish to tailor its compliance and ethics

program to prioritize fraud prevention in

order to best protect against the types of

issues its employees are most likely to face.

United States Sentencing Commission

Individual Co-Defendants and Their

Relationship to the Organizational

Offenders

In scal year 2000, the Commission

began collecting data on cases against

organizational offenders with individual

co-defendants and the individual

co-defendant's relationship to the

organization. Slightly more than half

(53.1%) of the organizational offenders

had at least one co-defendant (Figure

10). The number of co-defendants

uctuated throughout the scal years

as well, with a high of 448 individuals

indicted in scal year 2002 and a low of

135 individuals in scal year 2018. The

number of co-defendants by scal year

was not associated with the number of

organizational offenders; however, the

average number of co-defendants per

organization increased from one co-

defendant in scal year 2000 to two co-

defendants in scal year 2021.

Figure 10. Organizational Offenders Charged With at Least One Individual Co-Defendant

Fiscal Years 2000–2021

No Individual(s)

Charged

46.9%

Individual(s)

Charges

53.1%

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

The Commission categorizes the

relationship of individual co-defendants

to the organization into two categories:

high-level authority

116

and not high-level

authority.

117

From scal year 2000 through

scal year 2008, half to a majority of

Figure 11. Percentage of High-Level Authority Individual Co-Defendants

Fiscal Years 2000–2021

individual co-defendants fell within the

category of high-level authority (Figure

11). Starting in scal year 2009, with a

few exceptions,

118

high-level authority

individual co-defendants constituted about

half or fewer individual co-defendants.

72.8%

72.4%

50.2%

62.2%

72.0%

72.9%

67.8%

67.3%

52.0%

37.3%

60.1%

48.1%

34.9%

29.2%

45.1%

50.0%

44.8%

51.6%

57.0%

30.8%

42.7%

25.7%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

United States Sentencing Commission

Prior Misconduct

This section reports on all instances

in which an organizational offender

was involved in any prior misconduct.

Presentence reports provide additional

background information about

organizational offenders, even if

the information does not impact the

guideline calculations. For example, an

organizational presentence report details

Figure 12. Organizational Offenders With a History of Misconduct

Fiscal Years 1992–2021

all prior instances of misconduct by the

organization. This includes not only

previous criminal adjudications, but also

civil or administrative adjudications against

the organization. Those instances where

the misconduct impacted the guideline

ne calculation are discussed below. The

majority of organizations sentenced each

scal year did not engage in any prior

misconduct (79.2%) (Figure 12).

No History of

Misconduct

79.2%

History of

Misconduct

20.8%

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

Compliance and Ethics Programs

Presentence reports for organizational

offenders typically identify whether the

organization had an existing compliance

and ethics program.

119

As discussed in

more detail below, an organization with an

effective compliance and ethics program

receives a culpability score reduction,

thereby lowering its ne range. Since scal

year 1992, the overwhelming majority of

organizational offenders (89.6%) did not

have a compliance and ethics program,

120

and even fewer had a compliance and

Figure 13. Organizational Offenders With a Compliance Program

Fiscal Years 1992–2021

ethics program for which they received

a culpability score reduction. Only 398

organizational offenders (10.4%) had any

compliance and ethics program before

sentencing. The reported presence of a

compliance and ethics program varied each

scal year but remained below 20.0 percent

until scal year 2018 (Figure 13). Fiscal

year 2021 is the only year in which more

than half of the organizational offenders

(58.0%) reported having a compliance and

ethics program.

United States Sentencing Commission

CRIMINAL PURPOSE

ORGANIZATIONS

When imposing a ne, the court must

rst determine whether the organizational

offender operated primarily for a criminal

purpose or primarily by criminal means,

121

that is, it had no legitimate business

purpose. Should the court make such a

nding, the guidelines instruct the court

to impose a ne amount (subject to the

statutory maximum) sufcient to divest

Figure 14. Criminal Purpose Organizations

Fiscal Years 1992–2021

the organization of all its net assets.

122

The Commission intended that such a ne

would effectively put the organization

out of business. Commission data reects

that courts infrequently arrive at the

determination that an organization had

no legitimate business purpose. Since

scal year 1992, only 4.0 percent of

organizational offenders have been

identied as operating for a criminal

purpose under the guidelines (Figure 14).

No Criminal

Purpose

96.0%

Criminal Purpose

4.0%

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

APPLICATION OF CHAPTER

EIGHT FINE GUIDELINES

Courts are not required to calculate

the Chapter Eight guideline ne range

under two additional circumstances.

First, the ne guidelines in Chapter Eight

exclude certain types of offenses, including

environmental, most food, drug, and

agricultural, and the import and export

offenses.

123

These offenses make up a

signicant percentage of organizational

offenders.

124

In cases where the Chapter

Eight ne guidelines are not applicable,

the court will impose an applicable ne

pursuant to the statutes of conviction.

125

Second, §8C2.2 limits the application of

the ne guidelines if the court ascertains

that the organization (1) cannot and is not

likely to become able to pay restitution, or

(2) cannot and is unlikely to become able to

pay the minimum guideline ne.

126

Under

either prong, a court does not have to

determine the guideline ne range.

127

Since scal year 1992, courts have

applied the ne guidelines in Chapter

Eight of the Guidelines Manual to 2,421

organizational offenders (49.0%). The

application rates ranged from a low of

22.2 percent in scal year 1992, when

the Chapter Eight guidelines rst became

effective, to a high of 69.2 percent in scal

year 1995 (Figure 15). The changes in

these application rates may be related to

the changes in offense types over time

discussed above. In the past ten scal

years (2012–2021), courts applied the

guideline ne provisions to 39.2 percent of

organizational offenders.

Figure 15. Organizational Offenders With Chapter Eight Fine Guidelines Applied

Fiscal Years 1992–2021

United States Sentencing Commission

Chapter Eight Culpability Score

The Chapter Eight culpability score

reects the Commission's "carrot and stick"

approach to the organizational sentencing

scheme that bases the ne range, in part,

on the culpability of the organization.

128

The guidelines instruct courts to

determine culpability by considering six

factors. The four aggravating factors,

that is, those "that increase the ultimate

punishment of an organization are:

(i) the involvement in or tolerance of

criminal activity; (ii) the prior history

of the organization; (iii) the violation

of an order; and (iv) the obstruction of

justice."

129

The two mitigating factors

are: "(i) the existence of an effective

compliance and ethics program; and (ii)

self-reporting, cooperation, or acceptance

of responsibility."

130

This section of the

publication provides cumulative data

on the percentage of cases in which

courts either increased or decreased an

organization's culpability score due to the

presence of any of these factors. It then

reports on any trends that the Commission

observed over the 30-year period since

the promulgation of the organizational

guidelines.

Involvement in or Tolerance of

Criminal Activity

The guidelines explicitly require that

an organization promote an organizational

culture that "encourages ethical conduct

and a commitment to compliance with

the law" in order to have an effective

compliance and ethics program.

131

The

antithesis of such an organizational

culture is one in which the organization's

leadership is either actively involved in,

or seemingly indifferent to, the criminal

activity. Thus, the guidelines provide

for an increase in the culpability score

for organizations whose leadership

fails to encourage ethical conduct and

compliance with the law under one of two

circumstances. The score will be increased

if either "an individual within high-level

personnel of the organization

132

[or unit]

133

participated in, condoned, or was willfully

ignorant of the offense" or if "tolerance

of the offense by substantial authority

personnel

134

was pervasive throughout the

organization."

135

This adjustment takes

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

into account the size of the organization

by increasing the adjustment from one-

to ve-points, with the higher number of

points added for larger organizations.

136

As reected in Figure 16, more than

half (58.3%) of the organizational offenders

sentenced under the guideline ne

provisions from scal year 1992 through

scal year 2021 received a culpability score

increase for the involvement in or tolerance

of criminal activity. The most common

increase applied for this factor was the

one-point increase for organizations with

at least ten employees and an individual

within the substantial authority personnel

participated in, condoned, or was willfully

ignorant of the offense.

137

Figure 16. Culpability Score Increase for Involvement in or Tolerance of Criminal Activity

Fiscal Years 1992–2021

Tolerance

Adjustment Not

Applied

41.7%

Tolerance

Adjustment

Applied

58.3%

United States Sentencing Commission

Prior History

The prior history increase in the

culpability score only applies if the

instant offense occurred within certain

time frames after the prior similar

misconduct.

138

Either one criminal

adjudication for similar misconduct or civil

or administrative adjudications based on

two or more separate instances for similar

misconduct will operate to trigger the

increase.

139

If the offense of conviction

occurred within less than ve years from

the prior history, the prior history receives

a two-point increase.

140

A one-point

increase is awarded if the instant offense

occurred within less than ten years of the

prior history.

141

Organizational offenders infrequently

received a culpability score increase for

having prior history. As shown in Figure

17, courts applied this increase to 54

organizational offenders (2.4%) sentenced

under the ne guidelines since scal

year 1992. When courts did apply this

adjustment, organizational offenders most

commonly received the two-point increase

for a criminal, civil, or administrative

adjudication that occurred less than ve

years prior to the instant offense.

142

Figure 17. Culpability Score Increase for Prior History (§8C2.5(c))

Fiscal Years 1992–2021

Prior History Adjustment

Not Applied

97.6%

Prior History

Adjustment Applied

2.4%

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

Violation of an Order

An organization's culpability score

increases when the organization's

commission of the instant offense violated

either a judicial order, an injunction, or

a condition of probation.

143

A two-point

increase applies when the organization

either violated a judicial order or injunction

or the organization violated a condition

of probation by engaging in similar

misconduct.

144

The guidelines apply a one-

point increase for any other violations of a

condition of probation.

145

The instances where organizational

offenders received a culpability score

increase for violating a judicial order

were even more infrequent than the

increases for prior history (Figure 18). This

culpability score increase applied to 21

organizational offenders (0.9%) sentenced

under the ne guidelines. Nearly all these

21 organizational offenders received the

two-point increase for violating a judicial

order or injunction or violating a condition

of probation by engaging in similar

misconduct (0.8%), rather than the one-

point increase for a violation of a condition

of probation (0.1%).

146

Figure 18. Culpability Score Increase for Violation of an Order (§8C2.5(d))

Fiscal Years 1992–2021

Violation Adjustment

Not Applied

99.1%

Violation

Adjustment Applied

0.9%

United States Sentencing Commission

Obstruction of Justice

An organization receives an increase

in the culpability score when it obstructs

justice or otherwise impedes the

investigation, prosecution, or sentencing

of the instant offense, or failed to

take reasonable steps to prevent the

obstruction, impedance, or attempted

obstruction or impedance.

147

The

guidelines explain that this increase applies

"where the obstruction is committed on

Figure 19. Culpability Score Increase for Obstruction of Justice (§8C2.5(e))

Fiscal Years 1992–2021

behalf of the organization; it does not apply

where an individual or individuals have

attempted to conceal their misconduct

from the organization."

148

The type of

conduct that will trigger this increase is

similar to the conduct that triggers the

Chapter Three adjustment for obstruction

of justice.

149

Courts applied a culpability

score increase for obstruction of justice

to 138 organizational offenders (6.1%)

sentenced under the ne guidelines since

scal year 1992 (Figure 19).

Obstruction Adjustment

Not Applied

93.9%

Obstruction

Adjustment Applied

6.1%

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

Effective Compliance and Ethics

Program

The existence of an effective

compliance and ethics program is

a mitigating factor that reduces an

organization's culpability score.

150

O O R  C S

R   E C  E P

As discussed in other sections of this report, §8B2.1 describes the minimum

requirements for an effective compliance and ethics program.

152

Since scal year 1992,

11 organizational offenders have received a reduction for having an effective compliance

and ethics program. Aware of public interest in compliance and ethics programs

determined to be effective, the Commission examined the 11 organizational offenders

that received this adjustment in order to provide more robust information about these

offenders than previously available. However, the Commission is not able to provide

details about how these programs complied with the requirements of §8B2.1 since the

presentence reports do not include exhaustive descriptions of the programs.

Most of the organizational offenders that received the compliance and ethics

program reduction were domestic (6)

153

and private organizations (10). The majority

had less than 50 employees (6) and most remained nancially solvent at the time of

sentencing (10).

Among the other culpability score adjustments given, seven organizational offenders

received increases for involvement in or tolerance of criminal activity; all received

a culpability score decrease for acceptance of responsibility with nine of the 11

organizational offenders receiving the two-point reduction for fully cooperating in the

investigation and demonstrating acceptance of responsibility for their criminal conduct.

None of these organizations self-reported the offense to authorities.

Courts rarely apply this culpability score

decrease.

151

Only 11 organizational

offenders (0.5%) have received this

reduction in the past 30 years. These

organizational offenders are discussed in

more detail below.

United States Sentencing Commission

Acceptance of Responsibility

Most organizational offenders (85.2%)

to which the guideline ne provisions apply

received a culpability score decrease for

acceptance of responsibility.

154

This is

not surprising since most organizational

offenders plead guilty (92.8%), rather

than proceeding to trial. Most commonly

the organizational offenders (54.6%)

received the two-point reduction for

Figure 20. Culpability Score Decrease for Self-Reporting, Cooperation, and Acceptance of

Responsiblity (§8C2.5(g))

Fiscal Years 1992–2021

fully cooperating in the investigation

and demonstrating acceptance of

responsibility for their criminal conduct

(Figure 20).

155

Few organizational

offenders (1.5%) received the ve-point

reduction for disclosing the offense

to appropriate authorities prior to a

government investigation in addition to

their full cooperation and acceptance of

responsibility.

156

Acceptance

Adjustment Not

Applied

14.8%

Acceptance of

Responsibility

28.9%

Cooperation and Acceptance

of Responsibility

54.6%

Self-Disclosure, Cooperation, and

Acceptance of Responsibility

1.5%

Other

0.2%

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

SENTENCING OUTCOMES

The sentences imposed on

organizational offenders typically consisted

of monetary judgments (ne, restitution, or

forfeiture order), and a term of probation.

The conditions of probation may include

a requirement that the organization

implement an effective compliance and

ethics program. This section provides

information on the frequency in which

organizational sentences include each of

these different sanctions.

Monetary Judgments

Since scal year 1992, the courts have

imposed nearly $33 billion in nes on

organizational offenders. Additionally,

courts ordered organizational offenders

to pay restitution and forfeiture amounts

of approximately $6.6 and $6.5 billion,

respectively (Figure 21).

Since scal year 1992, courts

determined that approximately two-thirds

(65.6%) of organizational offenders were

able to pay a ne (Figure 22). The ability

Figure 21. Total Fine, Restitution, and Forfeiture Amounts

Fiscal Years 1992–2021

$32,763,701,169

$6,638,615,691

$6,469,447,892

$10

$15

$20

$25

$30

$35

Total Fine Amount Total Restitution Amount Total Forfeiture Amount

in billions

United States Sentencing Commission

to pay is an initial step in the application

of the Chapter Eight ne guidelines.

Likewise, when a court determines that an

organizational offender cannot pay a ne,

the court need not compute the guideline

ne range.

157

Figure 22. Organizational Offenders With

Ability to Pay Fine

Fiscal Years 1992–2021

Courts imposed a ne on 3,625

organizational offenders (73.3%) (Figure

23). In nearly every scal year, courts

imposed nes on more than two-thirds

of the organizational offenders.

158

Since

scal year 1992, the overall average ne

amount imposed was over $9 million and

Unble to Pay Entire

Fine Imposed

34.4%

Able to Pay Entire

Fine Imposed

65.6%

Figure 23. Imposition of Fine Ordered on

Organizational Offenders

Fiscal Years 1992–2021

No Fine Imposed

26.7%

Fine Imposed

73.3%

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

the median amount was $100,000. As

reected in Figure 24, the average and

median ne amounts differed by scal

year.

159

In the aggregate, the ne amounts

varied over time. In the early 1990s,

the average ne amount was less than

Figure 24. Fine Amount Ordered to be Paid by Organizational Offenders

Fiscal Years 1992–2021

$500,000, it generally increased over

time, and peaked in scal year 2017 at $67

million. There was less variation when

measuring the median ne amount, which

ranged from approximately $29,550 to

$662,500 over the study period.

$100,000

$200,000

$300,000

$400,000

$500,000

$600,000

$700,000

$10,000,000

$20,000,000

$30,000,000

$40,000,000

$50,000,000

$60,000,000

$70,000,000

$80,000,000

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

Avera ge Median

United States Sentencing Commission

Courts ordered restitution as part of a

sentence less frequently than nes (30.9%

and 73.3%, respectively) (Figure 25). For

the organizational offenders ordered to pay

restitution, the average restitution amount

imposed was $4.4 million and the median

restitution amount imposed was $180,486.

The average and median restitution

amounts also varied from scal year 1993

to scal year 2021 (Figure 26).

160

In the

1990s, the average restitution amount

was less than $1 million each scal year.

Since the turn of the century, the average

restitution amount has varied from a low

of $447,440 in scal year 2012, to a high of

over $17 million in scal year 2010.

Figure 25. Imposition of Restitution Ordered

on Organizational Offenders

Fiscal Years 1992–2021

No Restitution

Imposed

69.1%

Restitution

Imposed

30.9%

$100,000

$200,000

$300,000

$400,000

$500,000

$600,000

$700,000

$800,000

$900,000

$1,000,000

$5,000,000

$10,000,000

$15,000,000

$20,000,000

$25,000,000

$30,000,000

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

Average Median

Figure 26. Restitution Amount Ordered to be Paid by Organizational Offenders

Fiscal Years 1992–2021

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

Courts entered comparatively fewer

forfeiture orders against organizational

offenders (10.4%). The percentage of

forfeiture orders entered each scal year

ranged from none in scal year 1992 to

Figure 27. Imposition of Forfeiture Order on Organizational Offenders

Fiscal Years 1992–2021

24.2 percent in scal year 2016 (Figure 27).

Notably, entry of forfeiture orders against

organizational offenders has increased

from scal year 1992 to scal year 2021.

United States Sentencing Commission

Probation

"Section 8D1.1 sets forth the

circumstances under which a sentence

to a term of probation is required."

161

Courts sentenced over two-thirds of

organizational offenders (69.1%) to a term

of probation (Figure 28). The rates of

imposition of probation are not unexpected

given the broad circumstances under which

the guidelines require imposition of a term

of probation. Courts shall order a term of

probation under specied circumstances,

including if such a sentence is necessary to

"secure payment of restitution," "enforce a

remedial order," or "ensure completion of

community service,"

162

if the organization is

sentenced to pay a monetary penalty that is

not paid in full at the time of sentencing,

163

or if the organization has 50 or more

employees or is otherwise required by

law to have an effective compliance and

ethics program and does not have such a

program.

164

The maximum term of probation that

courts may impose is ve years.

165

The

average length of the terms of probation

imposed on organizational offenders was

39 months and the median length was 36

months.

Figure 28. Organizational Offenders Sentenced to Probation

Fiscal Years 1992–2021

No Probation

Ordered

30.9%

Probation

Ordered

69.1%

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

Implementation of an Effective

Compliance and Ethics Program

As a condition of probation, the

court can order that the organizational

offender take additional actions it

deems appropriate,

166

including the

implementation of an effective compliance

and ethics program.

167

Since scal year

2000, courts ordered approximately 20

percent (19.5%) of organizational offenders

to implement an effective compliance

and ethics program (Figure 29).

168

The

percentage of organizations ordered to

implement an effective compliance and

ethics program each scal year was rarely

more than one-third of the organizational

offenders and ranged from 5.1 percent in

scal year 2009 to 35.5 percent in scal

year 2012 (Figure 30).

Figure 29. Organizational Offenders Ordered

to Implement Compliance Program

Fiscal Years 2000–2021

Figure 30. Organizational Offenders Ordered to Implement Compliance Program

Fiscal Years 2000–2021

No Compliance

Program Ordered

80.5%

Compliance

Program Ordered

19.5%

14.0%

16.8%

15.1%

12.0%

16.2%

18.8%

19.8%

24.1%

6.2%

5.1%

28.2%

19.4%

35.5%

23.8%

27.8%

28.2%

20.5%

22.1%

25.3%

18.6%

29.8%

16.7%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

United States Sentencing Commission

CHAPTER THREE

I  

O S

G

As mentioned above, the impact of the

organizational guidelines is not limited to

their application in criminal sentencings.

Incentivizing organizations to develop and

maintain internal programs to prevent,

detect, and report criminal conduct is one

of the major innovations of the Chapter

Eight organizational guidelines,

169

so their

inuence has been evidenced in other

areas.

Not only did the organizational

guidelines inuence the prosecutorial

policy of the DOJ, they also inuenced the

policies of other regulatory agencies.

170

Additionally, the organizational guidelines

were "credited with helping to create an

entirely new job description: the Ethics and

Compliance Ofcer."

171

Public Sector Response to the

Guidelines

The organizational guidelines inuence

the decisions of federal agencies in

bringing enforcement actions against

organizations. The guideline criteria for an

effective compliance and ethics program

also serve as a model for compliance and

ethics program guidelines created by other

federal agencies.

U.S. Department of Justice

In 1999, the DOJ announced that

the existence and adequacy of an

organization's compliance program and

efforts to implement or improve an existing

compliance program were among the

factors that prosecutors would weigh

when determining whether to prosecute

an organization. The DOJ made the

announcement through a memorandum

issued by then-Deputy Attorney General,

Eric H. Holder, regarding bringing criminal

charges against corporations.

172

The

DOJ later codied these factors in the

Justice Manual.

173

When evaluating the

effectiveness of corporate compliance

programs, the DOJ expressly relies upon

the criteria set forth in §8B2.1.

174

While

the existence of a compliance program will

not absolve the organization of its criminal

liability, it may result in the DOJ choosing

to defer prosecution or use other means

to elicit the organization's cooperation to

change its business practices.

175

Within the last decade, the DOJ has

issued written guidance meant to assist

prosecutors in making informed decisions

about the effectiveness of a compliance

program.

176

In November 2012, the DOJ

Incentivizing organizations to

develop and maintain internal

programs to prevent, detect,

and report criminal conduct is

one of the major innovations of

the Chapter Eight organizational

guidelines, so their inﬂuence has

been evidenced in other areas.

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

and the SEC jointly issued a resource guide

aimed, in part, at providing businesses

and individuals with information to help

them implement effective compliance

programs.

177

The resource guide

incorporates the elements of an effective

compliance program, as set forth in §8B2.1,

to provide insight into the aspects of

compliance programs that the DOJ and

SEC assess.

178

The DOJ has since provided updated

guidance on the Evaluation of Corporate

Compliance Programs, which provides

greater clarity on some key issues

prosecutors consider when assessing

the adequacy of corporate compliance

programs during charging and settlement

decisions.

179

The guidance, which was rst

developed in 2017 under the leadership

of the DOJ's rst "corporate compliance

expert"

180

and was updated in 2019 and

2020, lays out the "fundamental questions"

that prosecutors should ask about

compliance programs:

• Is the corporation's compliance

program well designed?

• Is the program being applied

earnestly and in good faith? In

other words, is the program being

implemented effectively?

• Does the corporation's compliance

program work in practice?

181

The guidance then describes in detail

the topics that prosecutors should consider

when answering those questions.

182

The

elements of an effective compliance

and ethics program, set forth in §8B2.1,

underlie these topics.

183

Under the current administration, the

DOJ has "prioritized building a wealth

of compliance expertise among [its]

prosecutors and dedicating resources

to strengthen [its] abilities to assess the

effectiveness of compliance programs."

184

The DOJ's Assistant Attorney General

in charge of the Criminal Division is a

former chief compliance ofcer for a

Fortune 500 company.

185

The DOJ's

Fraud Section now has a specialized unit,

Corporate Enforcement, Compliance, and

Policy Unit, staffed with prosecutors and

former compliance and defense attorneys

"with deep experience in compliance,

monitorships, and corporate enforcement

matters."

186

With the "invigoration" of its

effort to combat corporate crime, the DOJ

continues to emphasize the importance of

an active review of compliance programs

to "ensure they adequately monitor for and

remediate misconduct"

187

and provide "true

independence, authority, and stature within

the company" for the chief compliance

ofcers and their functions.

188

U.S. Securities and Exchange

Commission

Similar to the DOJ, the SEC also

considers an organization's compliance

program when determining whether to

take enforcement action.

189

Its four-

part framework includes examining the

organization's efforts to self-police through

United States Sentencing Commission

an effective compliance program, self-

report misconduct, remediate wrongdoing,

and cooperate with law enforcement

authorities, all of which mirror the

organizational guidelines' requirements

for an effective compliance and ethics

program.

190

The SEC rst articulated its

four-part framework in the 2001 Seaboard

report that identied §8C2.5 as a source of

guidance for organizations to consider to

promote self-policing, self-reporting, and

remediation.

191

Organizations regulated

by the SEC may mitigate the impact of

possible prosecution by having an effective

compliance and ethics program.

192

U.S. Department of Health and

Human Services

Using the criteria for an effective

compliance and ethics program found in

§8B2.1 as a model for the development

of their own program guidelines, the

Ofce of Inspector General ("OIG") of the

U.S. Department of Health and Human

Services undertook the development of

a series of compliance programs directed

at various segments of the health care

industry.

193

When it initiated this project

in 1998, the OIG announced its intent to

incorporate elements of Chapter Eight into

its compliance program proposals.

194

The

OIG's compliance programs now apply to

a major portion of the health care services

industry of the United States and continue

to rely upon the guideline criteria.

195

U.S. Environmental Protection

Agency

In 1995, the EPA issued a "nal policy

to enhance protection of human health

and the environment by encouraging

regulated entities to voluntarily discover,

and disclose and correct violations of

environmental requirements."

196

Much like

the guidelines' carrot and stick approach,

the EPA's policy encourages self-policing

by foregoing criminal prosecution referrals

and by waiving or reducing civil penalties

for violations that are promptly disclosed

and corrected and imposing "stiff sanctions

for noncompliance."

197

The policy also

encourages the development of compliance

management programs, with enunciated

criteria "which are adapted from existing

codes of practice such as the 1991 Criminal

Sentencing Guidelines."

198

The EPA

revised the policy in 2000, but continued

its reliance on criteria adapted from the

organizational guidelines when evaluating

the due diligence exercised by its regulated

organizations to prevent, detect, and

correct violations.

199

Federal Energy Regulatory

Commission

The Federal Energy Regulatory

Commission ("FERC") "encourages

companies subject to [its] regulatory

requirements to develop rigorous

compliance programs."

200

In March 2010,

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

the FERC issued a policy statement on

penalty guidelines "for the purpose of

adding greater fairness, consistency

and transparency to [its] civil penalty

determinations"

201

that it patterned after

the sentencing guidelines.

202

In response

to public comment on the policy statement,

the FERC issued a revised policy statement

that continued to be modeled after the

organizational guidelines, with some

modications. The FERC explained "that

the [s]entencing [g]uidelines provide the

best model to adapt to the [FERC] purposes

because they focus on factors—such as

the seriousness and remediation of a

violation—that reect the requirements

of [the Energy Policy Act of 2005]

and that [the FERC] believe[s] are the

centerpiece of our penalty regime."

203

the organizational guidelines, the FERC

penalty scheme requires disgorgement of

pecuniary gain

204

and uses a base penalty

table

205

and minimum and maximum

multiplier

206

derived from a culpability

score calculation in order to set penalty

ranges.

207

The FERC's compliance program

requirements are almost identical to those

set forth in §8B2.1.

208

Federal Acquisition Regulations

Similarly, the Federal Acquisition

Regulations ("FAR") also incorporated

requirements for compliance programs

by organizations doing business with the

federal government.

209

While the FAR

has always provided for some limited

compliance program requirements, the

promulgation of the new compliance and

ethics program requirements at §8B2.1 in

2004 prompted a re-examination of the

FAR's requirements.

210

In 2007, several

federal agencies proposed changes to

the FAR, resulting in a new rule requiring

contractors to develop codes of ethics and

business conduct.

211

Private Sector Response to the

Guidelines

Changes in Corporate Structure

The organizational guidelines'

inuence is not limited to the public

sector. Although initially resistant to the

idea of the organizational guidelines,

212

corporate America heeded the guidelines'

call for self-policing. Immediately

after promulgation of Chapter Eight in

1991, the number of organizations with

compliance and ethics departments

increased dramatically.

213

Essentially, the

guidelines transformed compliance "from

an industry-specic effort to a mainstream

Although initially resistant to

the idea of the organizational

guidelines, corporate America

heeded the guidelines' call for

self-policing.

United States Sentencing Commission

corporate concern"

214

and "spurred a

massive increase in corporate compliance

efforts."

215

Businesses recognized that

it was in their best interest to maintain

a proper compliance program

216

and

"began creating multi-faceted programs

to include the seven elements [for a

compliance program] specied by the

guidelines."

217

Moreover, the business

demands associated with developing and

implementing compliance programs led to

the birth of a "new job (later to be treated

as a profession)—the chief compliance

ofcer."

218

In the past three decades, the

compliance and ethics profession has

grown exponentially. "Today, estimates

of the aggregate direct costs to support

compliance programs are routinely in

the hundreds of billions of dollars."

219

Increasing numbers of staff contribute, in

part, to these costs (Figure 31).

220

"[T]he corporate compliance department

'has emerged, in many rms, as the co-

equal of the legal department.'"

221

addition, these departments now "function

with greater authority, organizational

support, and funding than in the past."

222

Figure 31. Number of Employed Compliance Ofcers

Annual Years 2011–2021

198,000

199,000

195,000

239,000

246,000

270,000

260,000

281,000

298,000

305,000

291,000

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

The U.S. Bureau of Labor Statistics denes a "compliance ofcer" as someone who "examine[s], evaluate[s], and

investigate[s] eligibility for or conformity with laws and regulations governing contract compliance of licenses and

permits, and perform[s] other compliance and enforcement inspection and analysis activities not classied elsewhere."

SOURCE: U.S. Bureau of Labor Statistics. Labor Force Statistics from the Current Population Survey 2011-2021 on BLS

Data Finder 1.1 Online Database, in May 2022.

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

Professional Organizations and

Resources

In addition to growing intra-company

expenditures, the growth of the compliance

and ethics profession led to the demand

for professional resources and the creation

of professional organizations designed to

provide forums for sharing best practices in

the eld. Today, there is a "robust and fully

functioning cottage industry dealing with

ethics and compliance issues,"

223

providing

a broad range of services.

Many national and international law

rms offer client services designed to assist

in developing and improving compliance

and ethics programs. Additionally,

"[c]ompanies emerged to provide

consulting, software, and training materials

to support the creation of compliance

departments."

224

The growth also spurred

the development of specialized compliance

organizations, such as the Ethics and

Compliance Initiative, the Health Care

Compliance Association ("HCCA"), and

the SCCE, to provide a forum for further

development of the eld.

Higher Education Degrees and

Professional Certiﬁcations

In recent years, many universities and

colleges around the world have become

interested in the study of organizational

compliance and ethics, along with the

related subjects of corporate governance

and risk. Thus, institutions of higher

learning have developed specialized

curriculum and offer specialized degrees

and professional certicate programs

in organizational compliance, ethics,

governance, and risk, both to train

professionals and to promote continuing

academic research in these subjects.

The ABA, the major law school

accreditation body in the United States,

225

lists at least 22 ABA-approved law schools

offering post-juris doctorate (J.D.) or

non-J.D. degrees in compliance, ethics,

governance, and risk that target various

industries, such as the healthcare and

nancial industries.

226

Universities and

other post-secondary schools also offer

programs on these subjects. Compliance

Week Magazine publishes a directory listing

educational programs from an additional

14 universities and colleges, both domestic

and international, offering degrees and

professional or post-graduate certicates

in corporate compliance, ethics, and risk.

227

Various universities offer programs that are

Compliance Certication Board("CCB")—

accredited by SCCE and HCCA.

228

In addition to conferring degrees, law

schools and universities have established

organizational compliance, ethics,

governance, or risk research centers;

entities dedicated to the practical and

academic research of these subjects to

promote understanding and best practices

for scholars and practitioners alike. For

example, New York University School

of Law has established the Program on

Corporate Compliance and Enforcement

United States Sentencing Commission

that is dedicated to the study of effective

corporate compliance, causes of corporate

misconduct, and enforcement.

229

Harvard

Law School has created its Program

on Corporate Governance to "foster

research and scholarship about corporate

governance" and frequently publishes

governance-related articles.

230

Other

universities have developed similar

programs.

231

INFLUENCE ON CORPORATE

LAW

In 1996, the reach of the organizational

guidelines extended into corporate law

following a decision by the inuential

Delaware Court of Chancery. In the

process of evaluating a proposed

settlement of a derivative suit seeking to

impose personal liability on members of the

board of directors, the court considered

whether director liability could stem from

unconsidered action by the board.

232

After

observing that "[t]he Guidelines offer

powerful incentives for corporations today

to have in place compliance programs

to detect violations of law, promptly to

report violations to appropriate public

ofcials when discovered, and to take

prompt, voluntary remedial efforts,"

233

the court concluded that "[a]ny rational

person attempting in good faith to meet an

organizational governance responsibility

would be bound to take into account

[the organizational guidelines]."

234

Thus,

the court held that a director has a good

faith duty to see that the organization

establishes adequate information and

reporting systems.

235

The decision was

widely interpreted to expand potential

liability for board members.

236

In fact,

following the Caremark decision, federal

and state courts recognized the importance

of compliance programs in the context of

shareholder derivative suits.

237

International Inﬂuence of the

Guidelines

By setting a "global benchmark" for

compliance programs,

238

the organizational

guidelines have also been inuential with

international governing and standards

bodies that fashion their own compliance

and ethics programs.

239

For example, the

United Nations includes among its many

initiatives, the development of compliance

and ethics programs targeting anti-

corruption and bribery. The United Nations

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

Ofce on Drugs and Crime recognizes

the Commission's use of incentives as

a criterion for an effective compliance

and ethics program and reports how this

innovation has been adopted by other

national standards organizations.

240

The

United Nation's Global Compact initiative

cites the sentencing guidelines as one of

the six most commonly used frameworks

by anti-corruption risk assessment

practitioners to catalog and classify

controls and other risk mitigating efforts.

241

The Organisation for Economic Co-

operation and Development ("OECD") is a

multinational organization that develops

public policy recommendations.

242

the United Nations, the OECD develops

guidance on how businesses can develop

anti-corruption compliance and ethics

programs.

243

As part of this initiative, the

OECD developed the 2009 Anti-Bribery

Convention.

244

To provide guidance to

businesses on how to promote the goals

of the 2009 Convention, the OECD

published the Good Practice Guidance on

Internal Controls, Ethics, and Compliance.

245

The OECD's guidance urged businesses

to adopt programs to monitor, detect, and

report wrongdoing that closely followed

the Chapter Eight guidelines.

246

In 2021,

the OECD updated the Anti-Bribery

Convention, which still retains the same

emphasis on the development of internal

compliance and ethics programs in the

earlier convention.

247

Many of the guidelines' provisions

have been emulated internationally in

the ght against anti-corruption and

anti-competition. Examples relating to

anti-corruption include the "UK Bribery

Act, Italian Legislative Decree 231/2001,

and amendments to [c]riminal codes in

countries around the world."

248

"New

Brazilian, French and South Korean anti-

bribery laws provide for some sort of

compliance defense or have a compliance

requirement."

249

"Other nations (including

Russia, Ukraine and Spain) have mandated

compliance programs."

250

Compliance

programs with requirements analogous

to the guideline criteria also feature

prominently in anti-competition guidance

issued by the Canadian Competition

Bureau

251

and in New Zealand and

Australia.

252

United States Sentencing Commission

CONCLUSION

What began as an "experiment" to

encourage legal compliance and foster

more ethical business practices is now

widely accepted as a success.

253

Described

as the "gold standard" for the evaluation

of an organization's compliance and ethics

program,

254

the organizational guidelines

appear to have achieved their stated

goal of "reduc[ing] . . . criminal conduct

by providing a structural foundation

from which an organization may self-

police its own conduct."

255

Evidence

suggests that compliance and ethics

programs implemented using the guideline

criteria produce positive effects on an

organization's behavior.

256

Moreover,

the organizational guidelines have had a

signicant impact on public and private

sector actors. Their criteria help inform

prosecutorial charging decisions and have

led to signicant changes in corporate

America that continue to evolve with

the development of best practices in the

compliance and ethics profession. Indeed,

their inuence is now spreading around the

globe, suggesting that the hallmarks of an

effective compliance and ethics program

have universal appeal.

While the data reported in this

publication cannot provide a complete

picture of the prevalence of corporate

crime in the United States, it can provide

some empirical support about the

importance of developing an effective

compliance and ethics program. It may

also help identify areas where existing

programs can be improved. At a minimum,

the Commission intends for this publication

to foster continued dialogue about the

benets of good corporate behavior.

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

APPENDIX A

ORGANIZATIONAL OFFENDER CHARACTERISTICS

Figure A-1. Number of Individual Offenders

Fiscal Years 1992–2021

United States Sentencing Commission

Figure A-2. Size of Organizational Offenders

Fiscal Years 1992–2021

75.0%

64.6%

57.8%

67.2%

47.7%

53.7%

50.8%

48.9%

76.1%

87.3%

92.9%

83.8%

95.2%

80.7%

79.0%

75.2%

62.8%

68.9%

76.0%

62.3%

60.7%

60.3%

56.9%

56.3%

45.7%

62.7%

64.3%

51.0%

54.2%

54.3%

Defunct Solvent Bankrupt (Ch. 7) Reorganization (Ch. 11) Financial Stress Other

NOTE: Asterisk indicates the number of organizational offenders is ten or less offenders.

Figure A-3. Financial Status of Organizational Offenders

Fiscal Years 1992–2021

NOTE: Asterisk indicates the number of organizational offenders is ten or less offenders.

80.0%

61.7%

73.9%

79.4%

72.2%

64.3%

67.4%

73.4%

66.3%

64.4%

71.0%

73.0%

73.2%

65.1%

77.0%

59.3%

77.8%

76.7%

73.6%

78.8%

68.6%

70.2%

70.6%

69.9%

74.3%

65.4%

62.9%

65.8%

66.1%

85.5%

< 50 Employees 50-99 Employees 100-499 Employees 500-999 Employees ≥ 1000 Employees

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

0.0%

10.9%

8.1%

2.7%

7.8%

4.6%

2.9%

5.0%

3.6%

2.7%

0.9%

5.5%

1.7%

3.8%

2.2%

1.6%

5.3%

1.3%

7.2%

2.5%

2.7%

4.7%

8.6%

1.1%

5.3%

6.1%

2.0%

6.8%

2.1%

7.8%

Figure A-4. Organizational Offenders With History of Misconduct

Fiscal Years 1992–2021

Figure A-5. Criminal Purpose Organizations

Fiscal Years 1992–2021

NOTE: Asterisk indicates the number of organizational offenders is ten or less offenders.

United States Sentencing Commission

APPENDIX B

ORGANIZATIONAL OFFENSE AND INDUSTRY TYPES

Table B-1. Offense Type of Organizational Offenders

Fiscal Years 1992–2021

Offense Type N %

Fraud 1,481 30.1

Environmental 1,183 24.0

Antitrust 412 8.4

Food/Drugs/Agricultural/Consumer Products 323 6.6

Money Laundering 300 6.1

Import and Export 255 5.2

Tax 167 3.4

Public Corruption: Bribery/Gratuity/Extortion 137 2.8

Drugs 128 2.6

Immigration 113 2.3

Administration of Justice Offenses 75 1.5

Larceny/Theft/ Embezzlement 73 1.5

Firearms 44 0.9

Racketeering/Extortion 37 0.8

Gambling 27 0.6

Contraband 16 0.3

Obscenity 16 0.3

Civil Rights 7 0.1

Food Stamps 5 0.1

Motor Vehicle 5 0.1

Archeological Damage 4 0.1

Forgery 2 0.0

Other 51 1.0

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

Figure B-1. Type of Industry of Organizational Offenders

Fiscal Years 2000–2021

FY00 FY21 FY00 FY21 FY00 FY21 FY00 FY21

AGRICULTURE MINING CONSTRUCTION

ENVIRONMENTAL

MANAGEMENT

Fiscal Years

2000 3.3% 1.8% 7.6% 11.6%

2001

5.5% 2.9% 8.4% 5.9%

2002

2.5% 6.7% 8.0%

2003

7.5% 2.7% 4.8% 3.8%

2004 4.1% 4.1% 7.4% 4.1%

2005

4.6% 1.7% 7.4% 5.1%

2006

7.2% 1.0% 5.6% 6.7%

2007

3.8% 7.6% 5.1% 7.0%

2008 8.0% 7.4% 4.9%

2009

7.6% 3.2% 3.8% 6.3%

2010

11.4% 2.9% 2.1% 2.1%

2011

9.5% 1.3% 4.4% 7.0%

2012 7.3% 2.8% 7.3% 3.4%

2013

3.0% 1.8% 5.4% 3.6%

2014

4.4% 1.9% 7.6% 1.3%

2015

6.8% 3.4% 5.7% 1.1%

2016 6.4% 2.4% 5.6% 3.2%

2017

3.9% 1.6% 8.7% 2.4%

2018

4.2% 12.6% 4.2%

2019

6.3% 8.0% 3.6%

2020 12.0% 1.1% 9.8% 2.2%

2021

4.4% 11.1% 4.4%

2019 28.3% 17.2% 18.0% 10.0%

FY00 FY21 FY00 FY21 FY00 FY21 FY00 FY21

MANUFACTURING TRANSPORTATION RETAIL TRADE SERVICES

Fiscal Years

2000 22.0% 11.6% 11.2% 9.0%

2001

23.1% 8.4% 13.9% 8.8%

2002

23.9% 7.5% 15.1% 9.6%

2003

27.4% 10.2% 10.8% 12.9%

2004 27.1% 8.2% 16.4% 9.8%

2005

25.6% 11.4% 13.6% 13.6%

2006

18.0% 5.1% 19.0% 14.4%

2007

10.1% 10.1% 11.4% 13.9%

2008 11.7% 12.9% 14.1% 12.3%

2009

17.1% 10.1% 11.4% 13.9%

2010

17.1% 17.1% 8.6% 12.9%

2011

20.3% 15.8% 8.9% 10.8%

2012 21.4% 15.7% 13.5% 6.7%

2013

16.2% 14.4% 16.8% 9.6%

2014

20.1% 16.4% 15.1% 10.1%

2015

17.6% 15.3% 13.6% 10.8%

2016 20.6% 15.1% 13.5% 11.9%

2017

19.7% 15.0% 6.3% 11.0%

2018

21.1% 11.6% 15.8% 9.5%

2019

19.6% 16.1% 16.1% 8.0%

2020 6.5% 10.9% 21.7% 15.2%

2021

13.3% 6.7% 15.6% 12.2%

FY00 FY21 FY00 FY21 FY00 FY21 FY00 FY21

ORGS, ASS'NS, CHARITIES FINANCE HEALTH CARE SERVICES PUBLIC ADMIN

Fiscal Years

2000 0.4% 6.1% 9.4% 1.1%

2001

5.5% 11.3% 0.8%

2002

0.4% 4.6% 18.8% 0.8%

2003

8.1% 8.6% 0.5%

2004 3.3% 15.6%

2005

5.7% 10.8% 0.6%

2006

1.0% 7.7% 10.3% 1.5%

2007

0.6% 8.9% 19.0%

2008 1.8% 6.1% 12.9% 1.2%

2009

2.5% 3.8% 12.7% 0.6%

2010

0.7% 5.7% 17.1% 2.1%

2011

0.6% 5.1% 14.6% 0.6%

2012 2.3% 2.3% 16.9% 0.6%

2013

9.0% 18.6%

2014

0.6% 8.2% 13.2%

2015

5.1% 12.5%

2016 0.8% 7.1% 9.5%

2017

0.8% 7.9% 21.3%

2018

9.5% 11.6%

2019

0.9% 1.8% 17.9%

2020 1.1% 7.6% 12.0%

2021

11.1% 20.0% 1.1%

United States Sentencing Commission

Figure B-2. Offense Type of Organizational Offenders by Industry Type

Fiscal Years 2000–2021

Manufacturing (n=694) 1.5% 18.1% 2.6% 0.3% 1.6% 1.6%

Health Care Services (n=493) 2.8% 0.8% 3.3% 6.3%

Retail Trade (n=478) 0.8% 3.6% 0.4% 1.3% 2.1% 4.2% 7.3%

Transportation (n=419) 3.6% 15.3% 3.1% 0.5% 0.2%

Services (n=391) 1.8% 4.1% 0.3% 4.9% 0.3% 0.8% 1.5%

Construction (n=237) 1.3% 4.2% 9.7% 0.4%

Finance (n=219) 1.4% 4.1% 3.7% 2.3%

Agriculture (n=207) 1.0% 0.5% 1.0% 1.5%

Enviro Management (n=179) 0.6% 2.2% 1.1%

Mining (n=73) 1.4% 8.2%

Orgs, Ass'ns, Charities (n=23) 4.4%

Public Admin (n=21) 4.8%

Other (n=98) 1.0% 4.1% 3.1% 1.0% 1.0% 3.1%

Public

Corruption

Civil Rights

Contraband

Trademark

Drugs

Admin of

Justice

Antitrust

Arch. Damage

Manufacturing (n=694) 24.9% 9.3% 0.7% 9.8% 22.0%

Health Care Services (n=493) 0.8% 1.8% 25.2% 54.0%

Retail Trade (n=478) 9.0% 13.6% 4.8% 9.0% 0.8% 0.2% 17.0% 1.3%

Transportation (n=419) 47.7% 5.5% 20.1%

Services (n=391) 16.1% 4.1% 0.5% 1.3% 0.3% 32.7% 3.3%

Construction (n=237) 26.6% 0.4% 0.4% 39.2%

Finance (n=219) 11.0% 1.4% 0.5% 47.0%

Agriculture (n=207) 54.1% 5.8% 11.1% 14.0%

Enviro Management (n=179) 66.5% 0.6% 0.6% 21.8%

Mining (n=73) 46.6% 4.1% 21.9%

Orgs, Ass'ns, Charities (n=23) 8.7% 8.7% 17.4% 13.0%

Public Admin (n=21) 57.1% 9.5% 23.8%

Other (n=98) 19.4% 10.2% 4.1% 2.0% 26.5% 1.0%

FDA

Food Stamps

Forgery

Firearms

Fraud

Gambling

Import and

Export

Environment

% %

Manufacturing (n=694) 1.0% 2.2% 2.5% 0.1% 0.1% 1.9% 0.1%

Health Care Services (n=493) 0.2% 0.6% 3.3% 0.2% 0.6% 0.2%

Retail Trade (n=478) 4.2% 1.1% 0.2% 15.1% 0.4% 0.6% 1.9% 1.3%

Transportation (n=419) 0.2% 1.0% 0.7% 1.0% 1.2%

Services (n=391) 8.2% 3.1% 8.7% 2.6% 2.1% 2.6% 1.0%

Construction (n=237) 6.8% 1.7% 5.1% 4.2%

Finance (n=219) 0.9% 1.4% 18.7% 2.3% 3.7% 1.8%

Agriculture (n=207) 5.8% 1.9% 1.5% 0.5% 1.5%

Enviro Management (n=179) 1.7% 1.1% 2.2% 0.6% 1.1%

Mining (n=73) 1.4% 1.4% 15.1%

Orgs, Ass'ns, Charities (n=23) 4.4% 21.7% 4.4% 13.0% 4.4%

Public Admin (n=21) 4.8%

Other (n=98) 4.1% 1.0% 14.3% 2.0% 1.0% 1.0%

Obscenity

Racketeering

Tax

Other

Immigration

Larceny

Motor Vehicle

Money

Laundering

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

APPENDIX C

ORGANIZATIONAL OFFENDERS AND CO-DEFENDANTS

Figure C-1. Organizational Offenders Charged With at Least One Individual Co-Defendant

Fiscal Years 2000–2021

53.3%

53.8%

57.5%

51.0%

53.9%

51.9%

48.9%

56.9%

42.2%

53.7%

45.0%

56.9%

50.8%

61.1%

58.0%

58.6%

53.8%

45.8%

45.5%

58.5%

61.7%

47.8%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

United States Sentencing Commission

APPENDIX D

CHAPTER EIGHT APPLICATIONS

Figure D-1. Culpability Score Increase for Involvement in or Tolerance of Criminal Activity

(§8C2.5(b)) by Number of Employees

Fiscal Years 1992–2021

66.7%

32.1%

32.7%

44.4%

37.6%

26.6%

31.4%

40.0%

29.5%

42.6%

30.8%

32.6%

42.0%

31.8%

30.2%

23.6%

26.3%

24.0%

40.0%

18.9%

34.9%

33.3%

45.6%

33.3%

23.4%

31.3%

22.2%

28.1%

33.3%

34.4%

+10 Employees +50 Employees +200 Employees +1000 Employees +5000 Employees No Adjustment

NOTE: Asterisk indicates the number of organizational offenders is ten or less offenders.

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

3.6%

1.2%

2.2%

2.7%

0.9%

3.0%

4.1%

0.9%

0.7%

1.1%

2.9%

3.4%

0.9%

1.1%

1.0%

1.4%

6.2%

1.8%

4.3%

3.5%

3.1%

3.6%

1.8%

1.0%

0.7%

0.9%

2.3%

1.1%

3.7%

< 5 Year < 10 Years

1.2%

2.2%

2.0%

1.1%

4.6%

1.9%

1.1%

2.1%

3.1%

Figure D-2. Culpability Score Increase for Prior History (§8C2.5(c))

Fiscal Years 1992–2021

NOTE: Asterisk indicates the number of organizational offenders is ten or less offenders.

Figure D-3. Culpability Score Increase for Violation of an Order (§8C2.5(d))

Fiscal Years 1992–2021

NOTE: Asterisk indicates the number of organizational offenders is ten or less offenders.

United States Sentencing Commission

Figure D-4. Culpability Score Increase for Obstrucon of Jusce (§8C2.5(e))

Fiscal Years 1992–2021

14.6%

3.7%

5.4%

7.1%

6.8%

4.0%

6.2%

4.6%

10.5%

3.4%

7.3%

6.8%

8.5%

5.6%

3.2%

5.2%

1.7%

5.4%

9.5%

3.1%

7.0%

3.3%

2.1%

14.6%

1.9%

12.3%

5.3%

100.0%

71.4%

58.2%

60.5%

50.0%

52.2%

54.2%

55.0%

55.8%

50.0%

51.1%

39.3%

49.3%

59.1%

49.5%

44.9%

57.7%

60.4%

55.0%

59.5%

50.8%

62.1%

64.9%

61.7%

64.6%

59.3%

52.6%

43.6%

53.1%

Self-Disclosed Non-Guideline Acceptance (-3) Cooperation and Acceptance Acceptance No Acceptance

NOTE: Asterisk indicates the number of organizational offenders is ten or less offenders. Sentencing documents in three

cases indicate that courts applied either a one- or two- level adjustment for obstruction of justice, instead of the three-

point adjustment required by the guidelines.

Figure D-5. Culpability Score Decrease for Self-Reporng, Cooperaon, Acceptance of

Responsibility (§8C2.5(g))

Fiscal Years 1992–2021

NOTE: Asterisk indicates the number of organizational offenders is ten or less offenders.

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

APPENDIX E

ORGANIZATIONAL OFFENDERS WITH COMPLIANCE AND ETHICS

PROGRAM ADJUSTMENT

Table E-1. Organizaonal Oenders With a Culpability Score Decrease for a Compliance Program

Fiscal Years 1992–2021

Location N %

Inside U.S. 6 75.0

Outside U.S. 2 25.0

Ownership Structure N %

Private Organization 10 90.9

Openly-Traded Organization 1 9.1

Non-Profit Organization 0 0.0

Government Organization 0 0.0

Other 0 0.0

Size of Organization N %

Less than 50 Employees 6 60.0

50-to-99 Employees 1 10.0

100-to-499 Employees 0 0.0

500-to-999 Employees 1 10.0

More than or 1000 Employees 2 20.0

Financial Status at Sentencing N %

Defunct 0 0.0

Solvent 10 90.9

Bankrupt (Ch. 7) 0 0.0

Reorganization (Ch. 11) 0 0.0

Financial Stress 0 0.0

Other 1 9.1

NOTE: The location of organizational offenders was not collected prior to FY2000. Only offenders with complete

information were included in the analyses.

United States Sentencing Commission

Tolerance (§8C2.5(b)) N %

No Adjustment 4 36.4

+10 Employees 5 45.5

+50 Employees 1 9.1

+200 Employees 0 0.0

+1,000 Employees 0 0.0

+5,000 Employees 1 9.1

Prior History (§8C2.5(c)) N %

No Adjustment 11 100.0

< 5 Years after Prior Offense 0 0.0

< 10 Years after Prior Offense 0 0.0

Violation of an Order (§8C2.5(d)) N %

No Adjustment 11 100.0

Condition of Probation 0 0.0

Judicial Order or Similar Misconduct 0 0.0

Obstruction of Justice (§8C2.5(e)) N %

No Adjustment 11 100.0

Obstruction 0 0.0

Acceptance (§8C2.5(g)) N %

No Adjustment 0 0.0

Acceptance 2 18.2

Acceptance and Cooperation 9 81.8

Self Disclosed 0 0.0

Table E-2. Organizational Offenders With a Culpability Score Decrease for a Compliance Program

and Offense and Industry Types

Fiscal Years 1992–2021

Offense Type N %

Admin. of Justice 1 9.1

Drugs 1 9.1

Environmental 2 18.2

FDA 1 9.1

Fraud 2 18.2

Gambling 1 9.1

Immigration 2 18.2

Tax 1 9.1

Industry Type N %

Services 3 37.5

Transportation 2 25.0

Manufacturing 1 12.5

Environmental 1 12.5

Other 1 12.5

NOTE: The type of industry of organizational offenders was not collected prior to FY2000. Percentages may not equal

to 100.0 percent due to rounding.

Table E-3. Organizational Offenders With a Culpability Score Decrease for a Compliance Program

and Other Culpability Score Increases and Decreases

Fiscal Years 1992–2021

NOTE: Percentages may not equal to 100.0 percent due to rounding.

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

Table E-4. Organizational Offenders With a Culpability Score Reduction for a Compliance

Program: Sentencing Outcomes

Fiscal Years 1992–2021

Probation Ordered N %

No Probation Ordered 2 18.2

Probation Ordered 9 81.8

Of those with Probation Ordered

Average Months 37

Median Months 36

Ability to Pay Fine N %

Unable to Pay Fine 0 0.0

Able to Pay Fine 10 100.0

Imposition of Fine/Restitution N %

Did Not Impose Fine/Restitution 1 9.1

Imposed Fine/Restitution 10 90.9

Of those with Fine/Restitution

Average Amount $ 2,649,280

Median Amount $ 162,500

NOTE: Only offenders with complete information were included in the analyses.

United States Sentencing Commission

APPENDIX F

SENTENCING OUTCOMES

Figure F-1. Organizational Offenders With Ability to Pay Fine

Fiscal Years 1992–2021

Figure F-2. Imposition of Fine Ordered on Organizational Offenders

Fiscal Years 1992–2021

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

$10,000,000

$20,000,000

$30,000,000

$40,000,000

$50,000,000

$60,000,000

$70,000,000

$80,000,000

$100,000

$200,000

$300,000

$400,000

$500,000

$600,000

$700,000

Figure F-3. Average Fine Amount Ordered to be Paid by Organizational Offenders

Fiscal Years 1992–2021

Figure F-4. Median Fine Amount Ordered to be Paid by Organizational Offenders

Fiscal Years 1992–2021

United States Sentencing Commission

Figure F-5. Imposition of Restitution Ordered on Organizational Offenders

Fiscal Years 1992–2021

$5,000,000

$10,000,000

$15,000,000

$20,000,000

$25,000,000

$30,000,000

Figure F-6. Average Restitution Amount Ordered to be Paid by Organizational Offenders

Fiscal Years 1992–2021

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

$100,000

$200,000

$300,000

$400,000

$500,000

$600,000

$700,000

$800,000

$900,000

$1,000,000

Figure F-7. Median Restitution Amount Ordered to be Paid by Organizational Offenders

Fiscal Years 1992–2021

Figure F-8. Organizational Offenders Sentenced to Probation

Fiscal Years 1992–2021

United States Sentencing Commission

Table F-1. Length of Probation of Organizational Offenders

Fiscal Years 1992–2021

Fiscal

Year

Median

(in months)

Average

(in months)

1992* 51 43

1993 36 40

1994 36 37

1995 36 38

1996 36 42

1997 36 39

1998 36 39

1999 36 40

2000 36 41

2001 36 38

2002 36 42

2003 36 41

2004 36 33

2005 36 39

2006 36 40

Fiscal

Year

Median

(in months)

Average

(in months)

2007 36 40

2008 36 38

2009 36 37

2010 36 37

2011 36 39

2012 36 34

2013 36 38

2014 36 41

2015 36 38

2016 36 38

2017 36 39

2018 36 41

2019 36 41

2020 36 37

2021 36 34

NOTE: Asterisk indicates the number of organizational offenders is ten or less offenders.

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

1 See Oversight on the U.S. Sentencing Commission and Guidelines for Organizational Sanctions: Hearing

Before the Subcomm. on Crim. Just. of the H. Comm. on the Judiciary, 101st Cong. 189 (1990) (testimony of Hon.

William W. Wilkins, Jr., Chairman, U.S. Sentencing Commission). The guidelines offer ne reductions to

organizations with effective compliance and ethics programs or other mitigating factors (the carrot) and ne

increases to organizations with certain aggravating factors (the stick).

2 Ethics REs. ctR., thE FEdERal sEntEncing guidElinEs FoR oRganizations at twEnty yEaRs: a call to action

FoR MoRE EFFEctivE PRoMotion and REcognition oF EFFEctivE coMPliancE and Ethics PRogRaMs 28 (2012).

3 See Paul E. McGreal, The Amended Organizational Sentencing Guidelines: Top Ten Things Attorneys Should

Know, 42 hous. law. 10, 11 (2005) ("These criteria immediately became the gold standard for designing and

implementing an effective compliance program."); Barry Boss, U.S. Sentencing Commission Amends Corporate

Guidelines-What Do The Changes Mean For You?, MEtRo. coRP. couns. (2004) ("These guidelines not only serve as

the basis for determining punishment for corporations convicted of crimes but also provide the "gold standard"

for evaluating internal corporate compliance programs."); Paul Fiorelli & Ann Marie Tracey, Why Comply?

Organizational Guidelines Offer a Safer Harbor in the Storm, 32 J. coRP. l. 467 (2007) ("These guidelines . . . are

considered the 'gold standard' for evaluating internal corporate compliance programs.").

4 See s. REP. no. 97-307 (1981); h.R. REP. no. 98-1017 (1984); see also 28 U.S.C. §§ 991(b)(1)(B), 994(f).

5 s. REP. no. 98-225, at 66–67 (1983).

6 Id. at 76.

7 The purposes of sentencing were set forth in the SRA. Congress expressly determined that federal

sentencing should be tailored: (A) to reect the seriousness of the offense, to promote respect for the law, and

to provide just punishment for the offense; (B) to afford adequate deterrence to criminal conduct; (C) to protect

the public from further crimes of the defendant; and (D) to provide the defendant with needed educational or

vocational training, medical care, or other correctional treatment in the most effective manner. See Sentencing

Reform Act of 1984, Pub. L. No. 98–473, §212(a), 98 Stat. 1837, 1989 (codied as amended in 18 U.S.C.

§3553(a)(2)).

8 See 28 U.S.C. §§ 991, 994, 995(a)(1).

9 For purposes of title 18 of the United States Code, the term "organization" means "a person other than

an individual." See 18 U.S.C. § 18.

10 Prior to the SRA, courts did not have the legal authority to place an organization on probation.

11 18 U.S.C. § 3551(c).

12 S. REP. no. 98-225, at 68 (1983).

13 Id.; see also 18 U.S.C. §§ 3554–56.

ENDNOTES

United States Sentencing Commission

14 For a more comprehensive discussion of the history of the organizational guidelines, see Ketanji

Brown Jackson & Kathleen Cooper Grilli, The History of the Organizational Sentencing Guidelines and the

Emergence of Effective Compliance and Ethics Programs, in thE coMPlEtE coMPliancE and Ethics Manual (2022).

15 See Notice of Hearing, 51 FR 19918 (June 3, 1986); see also Transcript of Public Hearing before the U.S.

Sent'g Comm'n, Washington, D.C. (June 10, 1986). For a complete list of the witnesses, see u.s. sEnt'g coMM'n,

suPPlEMEntaRy REPoRt on sEntEncing guidElinEs FoR oRganizations, at B-1 (1991) [hereinafter 1991 suPPlEMEntaRy

REPoRt]. Commission materials cited herein are available on the Commission's website at www.ussc.gov.

16 See Preliminary Draft of Sentencing Guidelines for United States Courts, 51 FR 35080, 35083 (Oct. 1,

1986).

17 Id. at 35080. The draft presented "an approach currently being considered by the U.S. Sentencing

Commission in developing guidelines and policy statements for use by the federal courts in determining the

sentences to be imposed in criminal cases." Id. See also id. at 35081 (making clear that "[t]he preliminary draft

published for public comment seeks to accomplish several goals. The rst is to focus public attention on a

proposed format, a possible structure and suggested sentencing ranges. The format, structure, and suggested

terms of imprisonment will all be reconsidered by the Commission before the nal draft is written in light of

further deliberation, continued empirical research, and the receipt of written and oral comment").

18 Id. at 35129. Culpability would be measured by factors, such as "whether the crime resulted from a

conscious plan of top management or by the independent actions of lower echelon employees or whether the

organization took steps to discipline responsible employees prior to indictment." Id.

19 Id.

20 The Commission grappled with the "differing perceptions of the purposes of criminal punishment"

as it drafted both the individual and organizational guidelines. See u.s. sEnt'g coMM'n, Guidelines Manual, Ch.1,

Pt.A, intro. comment. (Nov. 2021) [hereinafter USSG]. The Commission ultimately resolved the philosophical

dilemma by "dr[awing] especially strong guidance" from the statutory purposes of sentencing set out in 18

U.S.C. § 3553. 1991 suPPlEMEntaRy REPoRt, supra note 15, at 5.

21 Preliminary Draft of Sentencing Guidelines for United States Courts, 51 FR at 35128.

22 The mandatory conditions of probation that courts must impose on an organizational offender are:

(1) the organization must not commit another federal, state, or local crime while on probation; and (2) the

organization must either pay a ne, make restitution, or perform community service. See 18 U.S.C. § 3563(a).

The only mandatory condition imposed upon probationers convicted of a misdemeanor or an infraction is the

requirement that they commit no further crimes while on probation. Discretionary conditions of probation are

listed in 18 U.S.C. § 3563(b).

23 Preliminary Draft of Sentencing Guidelines for United States Courts, 51 FR at 35128–29. The

early list of possible conditions of probation included "the use of internal audits and disciplinary actions;

the appointment of outside directors or supervisors; recommendations for debarment or ineligibility for

federal contracts, grants, or subsidies; charitable contributions; community service; and publicity about the

organization's misdeeds and subsequent corrective action." Id.

24 The Commission was required to deliver the rst set of guidelines for individual defendants to

Congress by April 1987. See Sentencing Reform Act of 1984, Pub L. No. 98–473, § 235, 98 Stat. 1837 (Oct.

12, 1984), as amended by Pub. L. No. 99–217, 99 Stat. 1728 (Dec. 26, 1985) ("[T]he United States Sentencing

Commission . . . [shall submit] the initial set of sentencing guidelines promulgated under section 994(a)(1) of

title 28 to the Congress within 30 months of the [date of enactment of this Act].").

25 1991 suPPlEMEntaRy REPoRt, supra note 15, at 1. The one exception was offenses involving antitrust

violations. Section 2R1.1 of the initial guidelines included a special instruction for computing nes for

organizations. See u.s. sEnt'g coMM'n, Guidelines Manual, §2R1.1(c) (Nov. 1987) ("The ne range for an

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

organization is from 20 to 50 percent of the volume of commerce, but not less than $100,000.").

26 See Sentencing Guidelines for United States Courts, 52 FR 18046 (May 13, 1987).

27 See Letter from William W. Wilkins, Jr. (July 1988), in u.s. sEnt'g coMM'n, discussion MatERials on

oRganizational sanctions (1988). These materials included a draft of sentencing guidelines for organizations,

a draft proposal on standards for organizational probation, and a report on past sentencing practices of

organizations by the federal courts from 1984 through 1987. See Public Hearings on Organizational Sanctions,

53 FR 32815, 32816 (Aug. 26, 1988). Working groups of scholars and experts from various government

agencies helped shape these materials. See 1991 suPPlEMEntaRy REPoRt, supra note 15, at 2.

28 See Jeffrey S. Parker, Staff Working Paper on Criminal Sentencing Policy for Organizations, in discussion

MatERials on oRganizational sanctions, supra note 27, at pt. IV, at 9.

29 The rst was held on October 11, 1988, in New York City, and the second in Pasadena, California

on December 2, 1988. See Public Hearing on Organizational Sanctions, 53 FR 35407 (Sept. 13, 1988); Public

Hearing on Organizational Sanctions, 53 FR 41644 (Oct. 24, 1988), respectively.

30 For a complete list of the witnesses, see 1991 suPPlEMEntaRy REPoRt, supra note 15, at B-1–B-3.

31 See generally Transcript of Public Hearing before the U.S. Sent'g Comm'n, New York, N.Y. (Oct. 11,

1988); see also supra note 30.

32 See Transcript of Public Hearing before the U.S. Sent'g Comm'n, Pasadena, CA 71 (Dec. 2, 1988) (R.

Monks).

33 See Transcript of Public Hearing 73 (Dec. 2, 1988) (W. Wilkins, Jr.) ("The points you make are very

interesting."); Id. at 83 (S. Breyer) ("[I]t's a very interesting proposal, and I think perhaps practical."); Id.

(H. Corrothers) ("I think the idea is a marvelous one, and I would like to encourage you and to do anything I can

to help promote it, too.").

34 See 1991 suPPlEMEntaRy REPoRt, supra note 15, at 2.

35 See Letter from Joseph E. diGenova, Chair, Att'y Working Grp., to Hon. William W. Wilkins, Jr.,

Chairman, U.S. Sent'g Comm'n 2 (May 19, 1989).

36 See id. at 1. The Attorney Working Group consisted of recognized experts in the areas of white collar,

tax, antitrust law, and economic regulation, including Chair diGenova, Esq., Victoria Toensing, Esq., Ernest

Gellhorn, Esq., Bert W. Rein, Esq., Winthrop Swenson, Justin Thornton, Esq., Samuel J. Buffone, Esq., Earl Silbert,

Esq., Carl Rauh, and Robert Jordan, III Esq. Id. at 7. Notably, the group recommended that the Commission

limit itself to the promulgation of "exible policy statements rather than rigid and binding guidelines." Id. at 4.

Other reductions suggested by the Working Group included steps taken by the organization "to discipline the

responsible individuals" and to "make it easier for the criminal justice system to identify and punish responsible

individuals," or "if an organization takes appropriate steps to prevent a recurrence of similar offenses." Id. at 3.

37 See Sentencing Guidelines for United States Courts, 54 FR 47056 (Nov. 8, 1989).

38 On February 14, 1990, the Commission conducted a public hearing on "the proposals and any other

aspect of the sentencing guidelines, policy statements, and commentary as they apply to the sentencing of

organizations." See Sentencing Guidelines for United States Courts; Public Hearing, 55 FR 4045 (Feb. 6, 1990);

Transcript of Public Hearing before the U.S. Sent'g Comm'n, Washington, D.C. (Feb. 14, 1990). Seventeen

witnesses, with a diversity of backgrounds and interests, testied before the Commission about organizational

sentencing policy. For a complete list of the witnesses, see 1991 suPPlEMEntaRy REPoRt, supra note 15, at B-3.

39 For a complete list of the witnesses, see 1991 suPPlEMEntaRy REPoRt, supra note 15, at B-3.

United States Sentencing Commission

40 See U.S. Sent'g Comm'n, Public Meeting Minutes (Feb. 15, 1990).

41 At the time, the Commission had only four voting members. One of them, Judge George E.

MacKinnon, announced that he would "not vote to adopt any proposal for corporate sentences during this

current amendment period," expressing his concerns about a four-member Commission adopting such

important guidelines. See U.S. Sent'g Comm'n, Public Meeting Minutes 7 (Apr. 10–11, 1990). The Commission

is required to deliver guideline amendments to Congress no later than May 1 in order for such guideline

amendments to take effect by November 1, and their promulgation requires an "afrmative vote of at least four

members" of the Commission. See 28 U.S.C. §994(a), (p).

42 See U.S. Sent'g Comm'n, Public Meeting Minutes (Aug. 28, 1990).

43 See 1991 suPPlEMEntaRy REPoRt, supra note 15, at A-3.

44 See Sentencing Guidelines for United States Courts, 55 FR 46600, 46601 (Nov. 5, 1990). The

Commission also solicited public comment on proposed organizational guidelines prepared by the DOJ. The

DOJ's proposal included both aggravating and mitigating factors that would increase or decrease the offense

level used for determining the ne level. Notably, the DOJ's proposal did not identify the existence of an

effective program to prevent and detect violations of law as a mitigating factor but allowed for a one-level

reduction in the offense level if "the offense represented an isolated incident of criminal activity that was

committed notwithstanding bona de policies and programs of the organization reecting a substantial effort

to prevent conduct of the type that constituted the offense" or "[i]f the organization substantially cooperated in

the investigation, or if the organization has taken substantial steps to prevent a recurrence of similar offenses,

such as implementing appropriate monitoring procedures." Id. at 46612. The DOJ's proposed commentary did

not contain language explaining any of the terms used, such as "bona de policies and programs" or "substantial

steps to prevent recurrence."

45 Id. at 46605.

46 See Transcript of Public Hearing before the U.S. Sent'g Comm'n, Washington, D.C. (Dec. 13, 1990).

Among the witnesses were Robert S. Mueller, III, Esq., Assistant Attorney General, Criminal Division, U.S.

Department of Justice, James F. Rill, Esq., Assistant Attorney General, Antitrust Division, U.S. Department of

Justice, United States Attorney Joe B. Brown, Esq., in his capacity as Chairman, Attorney General's Advisory

Commission on Sentencing Guidelines, Richard R. Rogers, Esq., Associate Counsel of Ford Motor Company

representing the National Association of Manufacturers, and Jonathan C. Waller, Esq., Assistant General

Counsel, Sun Company, representing the American Corporate Counsel Association. For a complete list of the

witnesses, see 1991 suPPlEMEntaRy REPoRt, supra note 15, at B–5.

47 See Transcript of Public Hearing 17 (Dec. 13, 1990).

48 Id. at 78–79 (S. Cowen); Id. at 130 (R. Langsdorf); Id. at 99 (R. Rogers).

49 See U.S. Sent'g Comm'n, Public Meeting Minutes 6 (Apr. 26, 1991). Although the motion passed

unanimously, two commissioners made statements following the vote indicating disagreement with certain

policy decisions reected in Chapter Eight. Nevertheless, "the corporate sanctions draft was the workproduct

of all Commissioners." See id. (reecting comments by Commissioners MacKinnon, Nagel and Mazzone).

50 See USSG App. C, amend. 422 (effective Nov. 1, 1991).

51 John R. Steer, Changing Organizational Behavior—The Federal Sentencing Guidelines Experiment

Begins to Bear Fruit, Presented at the Twenty-Ninth Annual Conference on Value Inquiry, Tulsa, Oklahoma 8

(Apr. 26, 2001).

52 Id.

53 USSG Ch.8, intro. comment.

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

54 Id. (emphasis omitted). Remedying the harm could include a restitution order, a remedial order,

an order of probation requiring restitution or community service, or an order of notice to victim. See USSG

§§8A1.2(a), 8B1.1, 8B1.2, 8B1.3, 8B1.4.

55 USSG Ch.8, intro. comment.

56 Id. (emphasis omitted).

57 Id. Calculating the offense level for the ne table requires using the applicable Chapter Two guidelines

to determine the base offense level and application of any appropriate adjustments contained in that guideline,

followed by application of Chapter Three, Part D, if there is more than one such count. See USSG §§8C2.1,

8C2.3, 8C2.4.

58 USSG Ch.8, intro. comment.

59 Id.

60 Id.

61 Id.

62 Commentators included the Health Care Compliance Association, the Practising Law Institute,

and the Alliance for Health Care Integrity, among others. Comments were made in writing and orally to the

Commission. For a more detailed discussion of these suggestions, see Diana E. Murphy, The Federal Sentencing

Guidelines for Organizations: A Decade of Promoting Compliance and Ethics, 87 iowa l. REv. 697, 716–18 (2002).

63 During the intervening ten years after promulgation of the organizational guidelines, the Commission

continuously studied Chapter Eight's operation. For example, the Commission continued to consider the issue

of a guideline ne provision for organizations with respect to food and drug and environmental offenses, which

were not included in the guideline ne provisions in Chapter Eight. See, e.g., u.s. sEnt'g coMM'n, Food and dRug

woRking gRouP Final REPoRt (1995); u.s. sEnt'g coMM'n, REPoRt FRoM advisoRy gRouP on EnviRonMEntal sanctions

(1993). The Commission also held a symposium on corporate crime. See u.s. sEnt'g coMM'n, coRPoRatE cRiME

in aMERica: stREngthEning thE "good citizEn" coRPoRation (1995). At the symposium, the keynote speaker, Sen.

Edward M. Kennedy, noted the signicance of the organizational guidelines, agreeing that "commendable

efforts are underway to help ensure that companies doing business in this country are, in fact, good corporate

citizens." Id. at 119–20.

64 Murphy, supra note 62, at 698; see also In re Caremark Int'l Inc. Derivative Litig., 698 A.2d 959, 969

(Del. Ch. 1996) (noting that "[t]he Guidelines offer powerful incentives for corporations today to have in place

compliance programs to detect violations of law, promptly to report violations to appropriate public ofcials

when discovered, and to take voluntary remedial efforts").

65 Murphy, supra note 62, at 714. Chair Murphy cited authorities that dened a good compliance

program as one that "emphasize[s] values and moral responsibility" while a good ethics program "must help

employees to know and obey the law." Id. at 715 (citations omitted). See also Janet C. Cook, Assistant Gen.

Couns., U.S. Air Force, Remarks by Janet C. Cook, in coRPoRatE cRiME in aMERica: stREngthEning thE "good

citizEn" coRPoRation, supra note 63, at 380 ("A compliance program sets basic rules and procedures and can be

summed up in a checklist. An ethics program addresses values and decisions in the grey areas.").

66 See Sentencing Guidelines for United States Courts, 66 FR 48306 (Sept. 19, 2001).

67 See Press Release, U.S. Sent'g Comm'n, Sentencing Commission Convenes Organizational Guidelines

Ad Hoc Advisory Group (Feb. 21, 2002).

68 Id. The chair of the advisory group was B. Todd Jones, Esq., who served as the United States Attorney

United States Sentencing Commission

for the District of Minnesota before and after his time on the advisory group, before becoming Director of the

Bureau of Alcohol, Tobacco and Firearms. Other members of the advisory group included former Attorney

General, Eric Holder, Esq., and the current Inspector General for the DOJ, Michael Horowitz, Esq. For a

complete list of Advisory Group members and their relevant backgrounds, see u.s. sEnt'g coMM'n, REPoRt oF

thE ad hoc advisoRy gRouP on thE oRganizational sEntEncing guidElinEs, at app. A (2003) [hereinafter ad hoc

advisoRy gRouP REPoRt].

69 Pub. L. No. 107–204, 116 Stat. 745.

70 Sarbanes-Oxley Act § 805.

71 See U.S. Sent'g Comm'n, Advisory Group on Organizational Guidelines to the United States Sentencing

Commission (Mar. 19, 2002).

72 Id.

73 See U.S. Sent'g Comm'n, Public Comment Received by Advisory Group on Organizational Guidelines in

Response to Request for Public Comment (Mar. 19, 2002); U.S. Sent'g Comm'n, Public Comment Received in Response

to Additional Public Comment Requested (Oct. 15, 2002).

74 See ad hoc advisoRy gRouP REPoRt, supra note 68, at 1. Witnesses included former Director of the

Federal Bureau of Investigation, James Comey, Esq., Joshua Hochberg, Esq., Chief, Fraud Section, Criminal

Division, U.S. Department of Justice, Michael Goldsmith (former USSC Commissioner), J. Reuben Clark Law

School, Brigham Young University, Donald C. Klaiter, Esq., Morgan, Lewis & Bocklius, representing the ABA:

Antitrust Section, Stuart C. Gilman, Ph.D., President, Ethics Resource Center, James W. Conrad, Jr., Sidley Austin

Brown & Wood LLP, representing the American Chemistry Council. For a complete list of the witnesses and

their testimony, see U.S. Sent'g Comm'n, Public Hearing of the Ad Hoc Advisory Group on Organizational Guidelines

(Nov. 14, 2002).

75 ad hoc advisoRy gRouP REPoRt, supra note 68, at 2.

76 Id. at 3.

77 Id. at 3–5.

78 In response to the group's recommendation, on December 30, 2003, the Commission published

for public comment a proposed amendment that would move the minimum requirements of an effective

compliance program from the commentary into a new guideline to emphasize the importance of such programs.

See Sentencing Guidelines for United States Courts; Notice, 68 FR 75340, 75354 (Dec. 30, 2003). Following

publication of the proposed amendment, the Commission followed its usual process for promulgating

amendments, which included studying relevant data and information that the Commission staff compiled and

reviewing the formal public comment. See 28 U.S.C. §994(o), (p), (x); u.s. sEnt'g coMM'n,

RulEs oF PRacticE and

PRocEduRE pt. IV, at 5 (2016).

79 The Commission held a public hearing in March, 2004, at which two panels of subject matter experts

testied about the proposed amendment to Chapter Eight. See Transcript of Public Hearing before the U.S.

Sent'g Comm'n, Washington, D.C. (Mar. 17, 2004).

80 See U.S. Sent'g Comm'n, Public Meeting Minutes (Apr. 8, 2004); USSG App. C, amend. 673 (effective

Nov. 1, 2004); see also USSG §8B2.1.

81 See USSG App. C, amend. 673 (effective Nov. 1, 2004); see also USSG §8B2.1.

82 See USSG App. C, amend. 673 (effective Nov. 1, 2004); USSG §8B2.1; see also U.S. Sent'g Comm'n,

Public Meeting Minutes (Apr. 8, 2004).

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

83 USSG App. C, amend. 673 (effective Nov. 1, 2004); see also USSG §8B2.1(a)(2).

84 The guidelines dened "small organization" as an organization having fewer than 200 employees. See

USSG §8C2.5, comment. (n.1).

85 See USSG App. C, amend. 673 (effective Nov. 1, 2004).

86 Id.

87 Id.; see also USSG §8C2.5(f)(3)(B). A motion to allow the rebuttable presumption to extend to all

organizations, both large and small, failed by vote of two to four. See U.S. Sent'g Comm'n, Public Meeting

Minutes (Apr. 8, 2004).

88 Letter from Daniel R. Roach, Co-Chair, Soc'y of Corp. Compliance and Ethics, to U.S. Sent'g Comm'n 1

(Mar. 19, 2010).

89 See Sentencing Guidelines for United States Courts, 75 FR 3525, 3534 (Jan. 21, 2010).

90 See generally U.S. Sent'g Comm'n, Public Comment from March 17, 2010 (Mar. 17, 2010) (providing

public comment letters received by the Commission in response to 75 FR 3525).

91 Id. The Environmental Protection Agency and National Oceanic and Atmospheric Administration also

submitted comment. Id.

92 Id. At the time, those standing advisory groups were the Probation Ofcers Advisory Group, the

Practitioners Advisory Group, and the Victims Advisory Group. In 2016, the Commission created a fourth

standing advisory group, the Tribal Issues Advisory Group.

93 See supra note 90. The Defense Industry Initiative on Business Ethics and Conduct, the Association

of Corporate Counsel, and the Open Compliance and Ethics Group were also among the commentators. In

addition, a former Vice Chair of the Commission, John Steer, and a member of the ad hoc advisory group,

Winthrop M. Swenson, also submitted public comment. See id. Both were Commission staff members when the

organizational guidelines were promulgated in 1991.

94 See id. The RAND Center for Corporate Ethics and Governance also commented on the proposed

amendment. See id.

95 See supra notes 90–94.

96 See Transcript of Public Hearing before the U.S. Sent'g Comm'n, Washington, D.C. (Mar. 17, 2010).

Witnesses on these two panels included David Debold, Esq., Chair, Practitioners Advisory Group, Susan

Hackett, Esq., Senior Vice President and General Counsel, Association of Corporate Counsel, Karen Harned,

Esq., Executive Director of the Small Business Legal Center, National Federation of Independent Business, Tim

C. Mazur, M.B.A., Chief Operating Ofcer, Ethics and Compliance Ofcer Association, Patricia J. Harned, Ph.D.,

President, Ethics Resource Center, and Joseph E. Murphy, Esq., Director of Public Policy Society of Corporate

Compliance and Ethics. See id. at 4–5.

97 See USSG App. C, amend. 744 (effective Nov. 1, 2010).

98 Id.

99 Id. The Commission has made no other substantive changes to the criteria for an effective compliance

and ethics program since that date. The Commission did, however, adjust the Chapter Eight ne table for

ination in 2015. See USSG App. C, amend. 791 (effective Nov. 1, 2015).

100 The Justice Manual (previously known as the U.S. Attorney's Manual) expressly provides that "[i]n certain

United States Sentencing Commission

instances, it may be appropriate to resolve a corporate criminal case by means other than indictment. Non-

prosecution and deferred prosecution agreements, for example, occupy an important middle ground between

declining prosecution and obtaining the conviction of a corporation." U.S. Dep't of Just., Just. Manual

§9-28.200 (2018). It further provides that "[l]ikewise, civil and regulatory alternatives may be appropriate in

certain cases." Id.

101 While the Commission does not collect information about the DOJ's organizational charging

decisions, some third parties publish information based on publicly available materials. See, e.g., gibson dunn,

2021 yEaR-End uPdatE on coRPoRatE non-PRosEcution agREEMEnts and dEFERREd PRosEcution agREEMEnts (2022).

102 The Commission receives and collects data from sentencing documents sent directly from the federal

courts. Within 30 days of the entry of judgment in a criminal case for either an individual or organizational

offender, the chief judge of each sentencing court is required to submit the following to the Commission:

(1) the Judgment and Commitment Order; (2) the Statement of Reasons form; (3) any plea agreement; (4)

the indictment or other charging document; (5) the Presentence Report; and (6) any other information the

Commission nds appropriate. See 28 U.S.C. §994(w)(1).

103 U.S. Sent'g Comm'n, 1993–2021 Corporate Datales. Fiscal year 1992 was extrapolated based on

sentencing date from the 1993 datale.

104 U.S. Sent'g Comm'n, 1993–2021 Individual Offender Datales.

105 As reected in Figure A-1, the number of individual offenders sentenced increased since scal year

1992 to a high in scal year 2011 before steadily decreasing into scal year 2021.

106 In scal year 2000, the Commission expanded the ownership structure to three additional categories:

partnership, sole proprietorship, and association. In scal year 2012, the Commission expanded the ownership

structure once again to include the Limited Liability Company or LLC.

107 An organization whose ownership is not open to the general public; these closely-held organizations

include organizations whose stock is held by a single shareholder or a group of closely-associated shareholders.

See U.s. sEnt'g coMM'n, vaRiablE codEbook: oRganizational dEFEndant databasE docuMEntation FoR datasEt

"icPsRo99" 14 (2015) (on le with the Commission).

108 An organization whose stock ownership is widely dispersed, i.e., the stock is traded on a public stock

exchange and the sale of stock is subject to regulation by state and federal agencies. See id.

109 An organization formed for some charitable or benevolent purpose that does not realize a prot. See

id.

110 An organization created and funded by a federal, state, or local government. See id.

111 An organization that cannot be categorized by any of the previous four categories. See id.

112 See U.s. sEnt'g coMM'n, Guidelines Manual, §2R1.1(c) (Nov. 1987) ("The ne range for an organization is

from 20 to 50 percent of the volume of commerce, but not less than $100,000."); see also supra note 25.

113 The 13 industries are: manufacturing, health care services, retail trade, transportation, services,

construction, nance, agriculture, environmental management, mining, "organizations, associations, charities,"

public administration, and other.

114 This is consistent with the prevalence of these two offense types overall. See Figure B-2 for more

information on offense types by industry. Money laundering is the most common offense type for the

organizations, associations, and charities industry, but this industry is less than one percent (0.7%) of all

organizational industries.

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

115 USSG §8B2.1(c).

116 An individual who is an owner, ofcer or board member (e.g., president, secretary, treasurer), or

manager or supervisor (e.g., sales manager, district manager).

117 An individual who is an employee, consultant, counsel, or not employed by the organization.

118 Those exceptions are scal years 2010 (60.1%) and 2018 (57.0%).

119 Inclusion of this information helps inform the court's decision whether to impose a term of probation

because courts have authority to order organizations to develop an effective compliance and ethics program as

a condition of probation. See USSG §8D1.4(b)(1).

120 This data highlights the importance of developing an effective compliance and ethics program. Among

the factors that prosecutors consider when deciding whether to charge an organization with a criminal offense

are the adequacy and effectiveness of a compliance and ethics program at the time of the offense and at the

time of a charging decision, and the organization's efforts to implement an adequate and effective compliance

and ethics program or to improve an existing one. See U.S. Dep't of Just., Just. Manual §9-28.300 (2018).

121 See USSG §8C1.1.

122 Id.

123 The organizational ne guidelines at §§8C2.2 through 8C2.9 are applicable only to counts where the

guideline offense level is determined under the Chapter Two guidelines listed at §8C2.1. See USSG §8C2.1.

124 Of the top six offense types, only the fraud, antitrust, and money laundering offenses are subject to

the guideline ne provisions of Chapter Eight. See USSG §8C2.1.

125 However, when the Chapter Two offense guideline for a count is not listed in subsection (a) or (b) of

§8C2.1, but the applicable guideline results in the determination of the offense level by use of a listed guideline,

the provisions of §§8C2.2 through 8C2.9 are to be applied to that count. See USSG §8C2.1, comment. (n.2).

For example, if the conduct set forth in the count of conviction ordinarily referenced to §2N2.1, an offense

guideline not listed in §8C2.1(a), establishes §2B1.1 as the applicable offense guideline, which is listed in

§8C2.1(a), §§8C2.2 through 8C2.9 would apply because the actual offense level is determined under §2B1.1. Id.

126 USSG §8C2.2.

127 Between scal years 1992 to 2021, courts determined that 756 organizational offenders were unable

to pay the entire or partial amount of the ne, but still determined the guideline ne range for those offenders.

128 See USSG Ch.8, intro. comment. The ne range is also based on the seriousness of the offense

which "generally will be reected by the greatest of the pecuniary gain, the pecuniary loss, or the amount in a

guideline offense level ne table." Id.

129 Id.

130 Id.

131 USSG §8B2.1(a)(2).

132 USSG §8C2.5. The guidelines dene high-level personnel of the organization as "individuals who

have substantial control over the organization or who have a substantial role in the making of policy within the

organization." USSG §8A1.2, comment. (n.3(B)).

133 The guidelines dene "unit" as "any reasonably distinct operational component of the organization."

United States Sentencing Commission

USSG §8C2.5, comment. (n.2). The guidelines dene high-level personnel of a unit of the organization as

"agents within the unit who set the policy for or control that unit." USSG §8C2.5, comment. (n.3).

134 USSG §8C2.5. "'Substantial authority personnel' means individuals who within the scope of their

authority exercise a substantial measure of discretion in acting on behalf of an organization." USSG §8A1.2,

comment. (n.3(C)).

135 USSG §8C2.5(b)(1)–(5).

136 Id.

137 See infra Figure D-1.

138 USSG §8C2.5(c). "'Similar misconduct' means prior conduct that is similar in nature to the conduct

underlying the instant offense, without regard to whether or not such conduct violated the same statutory

provision. For example, prior Medicare fraud would be misconduct similar to an instant offense involving

another type of fraud." USSG §8A1.2, comment. (n.3(F)).

139 USSG §8C2.5(c).

140 Id.

141 Id.

142 See infra Figure D-2.

143 USSG §8C2.5(d).

144 USSG §8C2.5(d)(1).

145 USSG §8C2.5(d)(2).

146 See infra Figure D-3. Two organizational offenders received the one-point adjustment for violating a

condition of probation.

147 USSG §8C2.5(e).

148 USSG §8C2.5, comment. (n.9).

149 Id.; see also USSG §3C1.1, comment. (n.3, 4).

150 USSG §8C2.5(f).

151 A fair inference that can be drawn from this low application rate is that authorities pursue alternative

remedies against organizations with an effective compliance and ethics program. See infra note 175 and

accompanying text.

152 USSG §8B2.1.

153 The Commission did not collect this information until scal year 2000. See discussion supra p. 14.

154 USSG §8C2.5(g)(1)–(3).

155 USSG §8C2.5(g)(2); see also infra Figure D-5.

156 USSG §8C2.5(g)(1). The Commission identied ve organizational offenders that received a three-

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

point reduction for acceptance of responsibility rather than the one-, two-, or ve-point reductions provided for

in §8C2.5. In these instances, it appears as though the court may have mistakenly applied the Chapter Three

adjustment for acceptance of responsibility at §3E1.1, rather than the provisions of Chapter Eight. See USSG

§3E1.1.

157 USSG §8C2.2.

158 See infra Figure F-2. Only scal years 2002 and 2015 had less than two-thirds of organizational

offenders receive a ne.

159 Additional trends can be seen in Figures F-2 through F-4.

160 Additional trends can be seen in Figures F-5 through F-7.

161 USSG Ch.8, Pt.D, intro. comment.

162 USSG §8D1.1(a)(1).

163 USSG §8D1.1(a)(2).

164 USSG §8D1.1(a)(3).

165 USSG §8D1.2; see also 18 U.S.C. § 3561(c).

166 See USSG §§8D1.3, 8D1.4.

167 USSG §8D1.4(b)(1).

168 Although the implementation of an effective compliance and ethics program is noted under the

recommended conditions of probation, 23 organizational offenders were not placed on probation but were

nevertheless required to implement an effective compliance and ethics program as part of their sentence.

169 USSG Ch.8, intro. comment.; see also Samuel R. Miller & Daniel E. Kritz, New Developments in Corporate

Criminal Liability: The Benets and Risks of Compliance Programs, C800 ALI-ABA 267, 277 (1992) ("[T]he new

Federal Sentencing Guidelines for Organizations attempt to encourage corporate compliance programs by

offering substantial ne reductions on the upside and threatening mandatory probation on the downside.");

Robert Roberts, The Rise of Compliance-Based Ethics Management, 11 Pub. intEgRity 261, 262 (2009).

170 See Murphy, supra note 62, at 712–13.

171 Id. at 710.

172 See Memorandum from Eric H. Holder, Deputy Att'y Gen., U.S. Dep't of Just. to All Component Heads

and United States Attorneys, U.S. Dep't of Just. 3 (June 16, 1999). Several of Mr. Holder's successors issued

modied versions of this memorandum. For example, Deputy Attorney General Larry Thompson modied

the memo in 2003 and Deputy Attorney General Paul J. McNulty modied the Thompson memo in 2006.

Compliance and ethics programs remained part of the calculus in both modied versions. See Fiorelli & Tracey,

supra note 3, at 478–81.

173 See generally U.S. Dep't of Just., Just. Manual §9-28.000 (2018).

174 See id. § 9-28.800 n.1.

175 Civil or other regulatory enforcement actions are one alternative to criminal prosecution. See id. at

9-28.1200. Other possible resolutions include either "a non-prosecution or deferred prosecution agreement

with conditions designed, among other things, to promote compliance with applicable law and to prevent

United States Sentencing Commission

recidivism." Id. § 9-28.1100. While the Commission does not collect information on the DOJ's organizational

charging decisions, some third parties publish information based on publicly available materials. See, e.g., dunn,

supra note 101.

176 See cRiM. div., u.s. dEP't oF Just., Evaluation oF coRPoRatE coMPliancE PRogRaMs (2020).

177 u.s. dEP't oF Just. & U.S. sEc. & Exch. coMM'n, a REsouRcE guidE to thE u.s. FoREign coRRuPt PRacticEs

act 58–62 (2012). The DOJ and the SEC updated this resource guide and published the second edition in July

2020.

178 Id.

179 See Evaluation oF coRPoRatE coMPliancE PRogRaMs, supra note 176.

180 Eugene Soltes, Evaluating the Effectiveness of Corporate Compliance Programs: Establishing a Model for

Prosecutors, Courts, and Firms, 14 n.y.u. J.l. & bus. 965 (2018).

181 See Evaluation oF coRPoRatE coMPliancE PRogRaMs, supra note 176, at 1–2.

182 See Evaluation oF coRPoRatE coMPliancE PRogRaMs, supra note 176. This guidance may have been

developed, in part, in response to the compliance and ethics community's constant call for more information on

how the DOJ evaluates compliance and ethics programs. It has been described as the second most important

document for compliance, with the organizational guidelines being the rst. See Roy Snell, The Compliance Train

has Left the Station and is Gaining Speed, 19 J. hEalth caRE coMPliancE 29, 30 (2017). Mr. Snell was a co-founder

of the Society of Corporate Compliance and Ethics and Health Care Compliance Association and previously

served as its chief executive ofcer and rst president. Id. at 29 n.1.

183 See Evaluation oF coRPoRatE coMPliancE PRogRaMs, supra note 176.

184 Kenneth A. Polite, Jr., Assistant Att'y Gen., Remarks at NYU Law's Program on Corporate Compliance

and Enforcement, New York, N.Y. (Mar. 25, 2022).

185 Id.

186 Id.

187 Lisa O. Monaco, Deputy Att'y Gen., U.S. Dep't of Just., Keynote Address at ABA's 36th National

Institute on White Collar Crime, Washington, D.C. (Oct. 28, 2021).

188 See supra note 184.

189 See u.s. div. oF EnF't, U.S. sEc. & Exch. coMM'n, EnFoRcEMEnt Manual 98 (2017); see also supra note 177

and accompanying text.

190 See EnFoRcEMEnt Manual, supra note 189, at 98.

191 In the Matter of Gisela de Leon-Meredith, Exchange Act Release No. 44970, at n.2 (Oct. 23, 2001).

192 In 2021, the SEC announced it would focus on anti-money laundering programs and investment

advisers and investment companies' compliance programs. See Press Release, U.S. Sec. & Exch. Comm'n, SEC

Division of Examinations Announces 2021 Examination Priorities (Mar. 3, 2021).

193 See Off. of Inspector Gen., Dep't of Health & Hum. Servs., Compliance Guidance, https://oig.hhs.gov/

compliance/compliance-guidance/ (last visited May 25, 2022).

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

194 See Publication of the OIG Compliance Program Guidance for Hospitals, 63 FR 8987 (Feb. 23, 1998)

("Future compliance program guidances to be developed will be similarly structured and based on substantive

policy recommendations, the elements of the Federal Sentencing Guidelines, and applicable statutes,

regulations and Federal health care program requirements."); see also Publication of the OIG Model Compliance

Plan for Clinical Laboratories, 62 FR 9435 (Mar, 3, 1997) ("The [clinical laboratory model compliance program]

considers elements of the Federal Sentencing Guidelines.").

195 See Compliance Guidance, supra note 193.

196 Incentives for Self-Policing: Discovery, Disclosure, Correction and Prevention of Violations, 60 FR

66706 (Dec. 22, 1995).

197 Id. at 66706–07.

198 Id. at 66708.

199 See Incentives for Self-Policing: Discovery, Disclosure, Correction and Prevention of Violations, 65 FR

19618, 19621 (Apr. 11, 2000).

200 See Compliance with Statutes, Regulations, and Orders, 125 FERC ¶ 61,058, at 1 (Oct. 16, 2008) (Policy

Statement on Compliance); see also Enforcement of Statutes, Orders, Rules, and Regulations, 113 FERC ¶61,068

(Oct. 20, 2005) (Policy Statement on Enforcement). The FERC began publicly explaining the factors it considers

when deciding on remedies, including penalties, for violations shortly after Congress passed the Energy Policy

Act of 2005, Pub. L. No. 109–58, 119 Stat. 594, which granted the FERC enhanced authority to assess civil

penalties. See id.

201 Enforcement of Statutes, Orders, Rules, and Regulations, 130 FERC ¶61,220, at 1 (Mar. 18, 2010) (Policy

Statement on Penalty Guidelines).

202 Id.

203 Enforcement of Statutes, Orders, Rules, and Regulations, 132 FERC ¶61216, at 7 (Sept. 17, 2010)

(Revised Policy Statement on Penalty Guidelines).

204 Id. at 92 (citing §1B1.1). This provision is similar to §8C2.9. See USSG §8C2.9.

205 Id. at 97 (citing §1C2.2); cf. USSG §8C2.4.

206 Id. at 103 (citing §§1C2.4, 1C2.5); cf. USSG §§8C2.6, 8C2.7.

207 Id. at 98 (citing §1C2.3); cf. USSG §8C2.5.

208 Id. at 92 (citing §1B2.1); cf. USSG §8B2.1.

209 48 C.F.R. § 52.203-13. For scal year 2020, the U.S. Government Accountability Ofce reported that

the federal government spent more than $665 billion on contracts, many of which were issued under the FAR.

See U.S. Gov't Accountability Off., A Snapshot of Government-Wide Contracting for FY 2020 (infographic) (June 22,

2021), https://www.gao.gov/blog/snapshot-government-wide-contracting-fy-2020-infographic.

210 See Christopher R. Yukins, Enhancing Integrity--Aligning Proposed Contractor Compliance Requirements

with Broader Advances in Corporate Compliance, 49 gov't contRactoR 166, 166–67 (2007) ("Those limited FAR

provisions became even more obviously inadequate when, in November 2004, the Sentencing Commission

revised its guidelines for corporate, or 'organizational,' compliance systems . . . . It was especially ironic that the

federal regulations governing contractor compliance lagged behind the rest of corporate America, because the

defense industry had earlier led the way in corporate compliance, as the industry responded to the 'Ill Wind'

contracting scandals of the mid-1980s.").

United States Sentencing Commission

211 See Federal Acquisition Regulation; FAR Case 2006–007, Contractor Code of Ethics and Business

Conduct, 72 FR 7588 (Feb. 16, 2007). The Department of Defense, General Services Administration, and

National Aeronautics and Space Administration put forth this proposal. Id. At the time, public comment

suggested that the guidelines' compliance and ethics program's provisions should be adopted; however, a

revised set of requirements were ultimately adopted. See Federal Acquisition Regulation; FAR Case 2006–007,

Contractor Code of Business Ethics and Conduct, 72 FR 65873, 65875 (Nov. 23, 2007).

212 Representatives of the Business Round Table publicly urged the Commission to "take more time to

consider the draft guidelines because of the potential impact on the corporate sector" and to adopt policy

statements instead of binding guidelines. U.S. Sent'g Comm'n, Public Meeting Minutes (Feb. 27, 1990). The

Commission received much public comment urging it to refrain from promulgating guidelines for organizations

and suggesting that the Commission had no statutory authority to do so. For further discussion of this issue,

see Ilene H. Nagel & Winthrop M. Swenson, The Federal Sentencing Guidelines for Corporations: Their Development,

Theoretical Underpinnings, and Some Thoughts about Their Future, 71 wash. u. l. REv. 205, 212–14 (1993). In

addition to these public statements to the Commission, members of the Business Round Table were allegedly

exerting pressure behind the scenes to delay implementation of the organizational guidelines. See Oversight on

the U.S. Sentencing Commission and Guidelines for Organizational Sanctions: Hearing Before the Subcomm. on Crim. Just.

of the H. Comm. on the Judiciary, 101st Cong. 173 (1990) (statement of Hon. John Conyers, Jr.). Judge MacKinnon

voiced the belief that the Commission's consideration of corporate guidelines had been "vigorously, if not

viscously (sic), opposed by the corporations at practically every meeting we had." Id. at 198; see also Jeffrey W.

Nunes, Organizational Sentencing Guidelines: The Conundrum of Compliance Programs and Self Reporting, 27 aRiz.

st. l. J. 1039, 1043–44 (1995) ("Initially, the Organizational Guidelines met with heavy opposition.").

213 See Tina Kelley, Earning It; Charting a Course to Ethical Prots, n.y. tiMEs, Feb. 8, 1998 (§3), at 1 ("Today

[Feb. 1998], more than 500 companies have created [ethics ofcers]—up from 200 just six years ago [1992] . . .

one of the main factors behind the sudden popularity of ethics ofcers was the creation in 1991 of sentencing

guidelines that reduced nes for white-collar crimes committed by corporations with comprehensive ethics

programs.").

214 Todd Haugh, The Criminalization of Compliance, 92 notRE daME l. REv. 1215, 1227 (2017); see also,

Robert S. Patterson Sr., Organizational Sentencing Guidelines, 29 tEnn. b.J. 28, 31 (1993) ("[T]he U.S. Sentencing

Guidelines for Organizations is the rst comprehensive effort to encourage all corporations to enact [corporate

compliance codes].").

215 Haugh, supra note 214, at 1228.

216 See Nancy A. Nord, Sentencing Guidelines Up the Ante for Corporate Compliance Programs, 9 acca

dockEt 48, 49 (1991) ("[T]he Guidelines provide strong incentive to re-examine and, if necessary, re-double

corporate compliance efforts. . . .[C]orporate managers would be ill-advised not to implement new programs

and undertake a thorough review of existing compliance efforts to assure conformity with the [g]uidelines.");

Thomas M. Schehr, An Analysis of a Corporate Director's Duty to Ferret out Wrongdoing: Have the Federal Sentencing

Guidelines Effectively Overruled Graham v. Allis-Chalmers? 42 waynE l. REv. 1617, 1641 (1996) ("[W]ith the

enactment of the Guidelines, it is in a corporation's best interests to maintain proper compliance programs

to minimize potential risk of loss."). Indeed, some even went so far as to suggest that it would be professional

malpractice for a general counsel to ignore implementation of a compliance program. See ad hoc advisoRy

gRouP REPoRt, supra note 68, at 29.

217 Michael Josephson, History of the Integrity, Ethics and Compliance Movement: A Cautionary Tale for CEOs

and Corporate Directors, Ethikos 13, 14 (2014).

218 Id. at 15; see also Amy Zipkin, Management: Getting Religion on Corporate Ethics; A Scourge of Scandals

Leaves its Mark, n.y. tiMEs, Oct. 18, 2000, at C1 ("The corporate title of ethics ofcer, for example, almost

unknown a decade ago, has become almost as familiar as chief information ofcer."); Susan Lorde Martin,

Compliance Ofcers: More Jobs, More Responsibility, More Liability, 29 notRE daME J.l. Ethics & Pub. Pol'y 169, 172

(2015) ("Corporate compliance and ethics programs and the position of CCO were rst created in a noticeable

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

way in 1991 in response to the enactment of the Federal Sentencing Guidelines.").

219 Soltes, supra note 180, at 969.

220 Id. at 969 n.11 ("Citigroup alone reported in 2015 that it had 26,000 compliance staff who were paid

an average of $60,000 a year."). The Criminalization of Compliance also reported that JP Morgan had hired 8,000

compliance personnel since the nancial crisis and HSBC added 1,600. See Haugh, supra note 214, at 1244.

221 See also Haugh, supra note 214, at 1244.

222 Id.

223 Paul Fiorelli, The Metrics of Ethics, 39 banking & Fin. sERvs. Pol'y REP. 13, 15 (2020); see also Ryan D.

McConnell, Jay Martin & Charlotte Simon, Plan Now or Pay Later: The Role of Compliance in Criminal Cases, 33

hous. J. int'l l. 509, 531 (2011) (stating "the Organizational Guidelines . . . spawned an industry of compliance

and ethics professionals").

224 Soltes, supra note 180, at 968.

225 Am. Bar Assoc., Law School Accreditation, https://www.americanbar.org/groups/legal_education/

accreditation/ (last visited May 25, 2022).

226 Am. Bar Assoc., LL.M. and Post-J.D. Programs by School, https://www.americanbar.org/groups/legal_

education/resources/llm-degrees_post_j_d_non_j_d/programs_by_school/ (last visited May 25, 2022). Among

the law schools represented are Boston University (Certicate in Financial Services Compliance), Fordham

University (Master's in Compliance), Loyola University Chicago School of Law (multiple graduate programs in

compliance and risk management), Santa Clara University (Master of Legal Studies in Corporate Compliance),

and the University of Southern California (Compliance Certicate). Id.

227 coMPliancE wk., 2019 diREctoRy oF gRc Education PRogRaMs (2019). Among the universities

represented are Georgetown University's McDonough School of Business (Certied Regulatory and

Compliance Professional Program), Harvard Business School (Corporate Board Regulatory Compliance and

Governance Seminar), New York University Stern Business School (Master of Science in Risk Management),

Wharton School of the University of Pennsylvania (Advanced Risk Management Program), Xavier University

(International Business Ethics and Compliance Certicate Program), and Yale School of Medicine (Compliance

and Safety Certication Program).

228 Soc'y of Corp. Compliance & Ethics, CCB-Accredited University Compliance and Ethics Programs, https://

www.corporatecompliance.org/university-program (last visited Apr. 21, 2022). HCCA established the CCB

in 1999. Although its initial mission was to create an examination and certication program for health care

compliance professionals, CCB now offers accreditation programs to other elds in addition to health care.

Soc'y of Corp. Compliance & Ethics, About CCB, https://www.corporatecompliance.org/certication (last visited

Apr. 21, 2022).

229 N.Y. Univ. Sch. of L., Program on Corporate Compliance and Enforcement, https://www.law.nyu.edu

/centers/corporatecompliance (last visited Apr. 21, 2022).

230 Harvard L. Sch., Program on Corporate Governance (May 2022), https://pcg.law.harvard.edu/; Harvard L.

Sch., Harvard Law School Forum on Corporate Governance (last visited May 26, 2022), https://corpgov.law.harvard.

edu/.

231 Other compliance and ethics centers include the FINRA Institute at Georgetown University (nancial

industry compliance), Ohio University's Institute for Applied and Professional Ethics (academic, business, and

public policy ethics), Santa Clara University's Markkula Center for Applied Ethics (business compliance and

ethics), Temple Law Center for Compliance and Ethics (compliance across disciplines and industries), University

of Virginia's Olsson Center for Applied Ethics (business ethics), and Xavier University's Cintas Institute for

United States Sentencing Commission

Business Ethics (business ethics and corporate culture).

232 In re Caremark Int'l Inc. Derivative Litig., 698 A.2d 959, 967 (Del. Ch. 1996).

233 Id. at 969.

234 Id. at 970.

235 Id.

236 Murphy, supra note 62, at 714.

237 See, e.g., Dellastatious v. Williams, 242 F3d 191, 196 (4th Cir. 2001) (directors can avoid liability in

shareholder derivative suits by showing a good faith attempt to create "an adequate corporate information-

gathering and reporting system"); McCall v. Scott, 239 F.3d 808, 819 (6th Cir. 2001) (directors can breach

their duciary duty if they intentionally or recklessly disregard red ags that should alert them to fraudulent

practices within the organization); In re Abbott Laboratories Derivative S'holder Litig., 325 F.3d 795, 808

(7th Cir. 2003) ("[D]irector liability may arise for the breach of the duty to exercise appropriate attention

to potentially illegal corporate activities from 'an unconsidered failure of the board to act in circumstances in

which due attention would, arguably, have prevented the loss.'" (citation omitted)); see also Kravitz v. Tavlarios,

No. 20-2579-CV, 2021 WL 5365582, at *2 (2d Cir. Nov. 18, 2021) ("[F]ailure [of a corporation's ofcers and

directors] to oversee or monitor corporate operations is known by Delaware courts as a 'Caremark claim,'" and

is a "breach[ of] the duciary duties that Delaware law impose[s] on them as ofcers and directors." (citation

omitted)); In re Boeing Co. Derivative Litig., No. 2019-0907-MTZ, 2021 WL 4059934, at *33 (Del. Ch. Sept. 7,

2021) ("[U]nder Caremark[,] the Board has a rigorous oversight obligation where safety is mission critical, as

the fallout from the Board's utter failure to try to satisfy this 'bottom-line requirement' can cause 'material

suffering,' even short of death, 'among customers, or to the public at large,' and attendant reputational and

nancial harm to the company." (internal citations omitted)); Hughes v. Hu, No. 2019-0112-JTL, 2020 WL

1987029, at *14 (Del. Ch. Apr. 27, 2020) ("For purposes of Caremark[,] 'a director may be held liable if she

acts in bad faith in the sense that she made no good faith effort to ensure that the company had in place any

"system of controls.'" (quoting Marchand v. Barnhill, 212 A.3d 805, 822 (Del. 2019)); Marchand, 212 A.3d at 824

("If Caremark means anything, it is that a corporate board must make a good faith effort to exercise its duty of

care. A failure to make that effort constitutes a breach of the duty of loyalty."); City of Cambridge Ret. Sys. v.

Ersek, 921 F.3d 912, 921 (10th Cir. 2019) ("To prevail . . . under Caremark[,]the Shareholders must plead with

particularity that the Board was presented with 'red ags' alerting it to misconduct at the company and that it

'consciously disregarded' those red ags. Red ags serve as proxies for Board knowledge." (quoting Stone ex rel.

AmSouth Bancorporation v. Ritter, 911 A.2d 362, 373 (Del. 2006) and City of Birmingham Ret. & Relief Sys. v.

Good, 177 A.3d 47, 59 (Del. 2017), respectively)); Rich ex rel. Fuqi Int'l, Inc. v. Yu Kwai Chong, 66 A.3d 963, 980–

82 (Del. Ch. 2013) ("The essence of a Caremark claim is a breach of the duty of loyalty arising from a director's

bad-faith failure to exercise oversight over the company."); South v. Baker, 62 A.3d 1, 6 (Del. Ch. 2012) ("As

developed in subsequent cases and endorsed by the Delaware Supreme Court . . . directors can be held liable

under [Caremark] for knowingly causing or consciously permitting the corporation to violate positive law . . . .");

In re Citigroup Inc. S'holder Derivative Litig., 964 A.2d 106, 125 (Del. Ch. 2009) ("[Under Caremark a] plaintiff

can show bad faith conduct by, for example, properly alleging particularized facts that show that a director

consciously disregarded an obligation to be reasonably informed about the business and its risks or consciously

disregarded the duty to monitor and oversee the business."); Stone, 911 A.2d at 370 ("Caremark articulates the

necessary conditions predicate for director oversight liability: (a) the directors utterly failed to implement any

reporting or information system or controls; or (b) having implemented such a system or controls, consciously

failed to monitor or oversee its operations thus disabling themselves from being informed of risks or problems

requiring their attention.").

238 Steven A. Lauer & Joseph E. Murphy, Compliance and Ethics Programs: What Lawyers Need to Know to

Understand the Development of This Field, 75 bus. law. 2541, 2550 (2020).

239 Dove Izraeli & Mark S. Schwartz, What Can We Learn from the U.S. Federal Sentencing Guidelines for

Organizational Ethics?, 17 J. bus. Ethics 1045, 1046 (1998) ("It may be the case that the time has arrived for

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

countries other than the U.S. to consider the development of legislation similar to the Guidelines, using the

Guidelines as a model or framework to follow.").

240 u.n. oFF. on dRugs & cRiME, an anti-coRRuPtion Ethics and coMPliancE PRogRaMME FoR businEss: a

PRactical guidE 74 n.63 (2013).

241 u.n. global coMPact: a guidE FoR anti-coRRuPtion Risk assEssMEnt 36 (2013).

242 See Organisation for Econ. Co-operation & Dev., Who We Are, https://www.oecd.org/about/ (last visited

May 26, 2022). The member states of the OECD include the United Sates, much of Europe, and several South

American and Asian nations. Id.

243 Organisation for Econ. Co-operation & Dev., Anti-Corruption & Integrity Hub (May 2022), https://www.

oecd.org/corruption-integrity/.

244 Organisation for Econ. Co-operation & Dev., OECD Anti-Bribery Convention, https://www.oecd.org/

corruption-integrity/explore/oecd-standards/anti-bribery-convention/ (last visited on May 26, 2022).

245 oRganisation FoR Econ. co-oPERation & dEv., good PRacticE guidancE on intERnal contRols, Ethics, and

coMPliancE (2010).

246 Joe Murphy & Donna Boehme, Commentary on the OECD Good Practice Guidance on Internal Controls,

Ethics and Compliance, 9 RutgERs J.l. & Pub. Pol'y 581, 586–88 (2012). This development is not surprising as

prominent compliance and ethics professionals from the United States worked with the OECD.

247 Organisation for Econ. Co-operation & Dev., OECD Convention on Combating Bribery of Foreign Public

Ofcials in International Business Transactions, https://www.oecd.org/corruption/oecdantibriberyconvention.

htm (last visited May 26, 2021). As of March 2022, 38 OECD and six non-OECD countries have adopted this

Convention. Id.

248 Maria Hernandez, Building a Global Compliance Department, 31 acc dockEt 28, 30 (2013).

249 James Corsiglia & Cleary Gottlieb, Justice Department Releases Standards for Evaluating Corporate

Compliance Programs, 31 wEstlaw J. gov't cont. 1, *3 (May 22, 2017).

250 Lauer & Murphy, supra note 238, at 2554.

251 See coMPEtition buREau can., coRPoRatE coMPliancE PRogRaMs (2015). This publication replaced an

earlier bulletin on corporate compliance program issued on September 27, 2010. Id.

252 See Lloyd Kavanaugh & Samantha Youjia Zhang, Is the FMCA a Watershed for Offer Due Diligence?, LAW

talk (Feb. 12, 2016), at 40–41 (discussing Standard NZS/AS 3806 Compliance Programs).

253 Ronald E. Berenbeim & Jeffrey M. Kaplan, The Convergence of Principle and Rule-Based Ethics Programs

- An Emerging Global Trend?, 11 wallstREEtlawyER.coM: sEc. ElEc. agE 1 (2007) ("While initially viewed as an

experiment (a term used even by the then chair of the Sentencing Commission), the model was soon considered

a success[.]") (referencing the Guidelines Manual Chapter Eight, Preface to Compliance Programs and the

Corporate Sentencing Guidelines (West 1993) (statement of the Hon. William Wilkins, Chair, U.S. Sentencing

Commission).

254 See supra note 3 and accompanying text.

255 USSG Ch.8, intro. comment.

256 See Izraeli & Schwartz, supra note 239, at 1046 ("Empirical evidence is now suggesting that the

implementation of these programs is raising the level of legal and ethical behavior in corporations."); Berenbeim

United States Sentencing Commission

& Kaplan, supra note 253, at 1 ("Ultimately, effective compliance initiatives can help raise the prole of ethical

thought in companies."). Additional benets, such as the efcient development of such programs may also

result. See, e.g., Herbert L. Thornhill, Jr. & Jeffrey M. Kaplan, Sentencing Guidelines Offer Pointers for Compliance,

159 aM. bankER 16, 16 (1994) ("Banks should adopt the Federal Organizational Sentencing Guidelines in order

to develop cost-effective regulatory compliance programs.").

The Organizational Sentencing Guidelines: Thirty Years of Innovation and Inuence

United States Sentencing Commission

www.ussc.gov

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