SDNY Offers Companies Facing Investigation New Incentives for Quick Self-Disclosure

Jay Clayton, U.S. Attorney for the Southern District of New York (SDNY) discussed corporate cooperation and self-disclosure in a fireside chat at the New York City Bar Association's annual International White Collar Symposium on Dec. 2, 2025. During an informal Q&A session, Clayton told the audience that his office is prepared to offer "real benefits" to corporations facing criminal investigations if they quickly agree to cooperate and compensate victims – with an emphasis on speed. Among the new benefits Clayton floated for early cooperation was a deferred prosecution for the corporation up front, following disclosure, but contingent on its continued cooperation. He also dangled the prospect of enhanced terms down the road.

This is the latest example of the U.S. Department of Justice's (DOJ) efforts to encourage companies that are under investigation or become aware of criminal conduct to self-disclose, with expanded incentives for doing so. It follows the DOJ's recent revisions, in March 2025, to the Criminal Division's Corporate Enforcement and Voluntary Self-Disclosure Policy (CEP). (See Holland & Knight's previous alert, "DOJ Announces New Policies and Priorities in Prosecution of White Collar Crime," May 15, 2025). Those changes were aimed at incentivizing companies that "self-disclose, fully cooperate, timely and appropriately remediate and have no aggravating circumstances" by offering them declination – an agreement from the DOJ not to pursue charges.

Key Takeaways

Prompt Disclosure. "Time matters," Clayton stressed to the group. "If the corporation says we're going to cooperate but still takes five years to get to the end of it, that's not cooperation."

Quick Resolution. He also stressed his desire for a quick resolution, unless the clients are "intentionally trying to hide [something]." "[I]f we can get the bad actors out, get a remedy and, most importantly, compensate the victims quickly, that's the kind of corporate cooperation program that I want to see."

Prompt Compensation to Victims. Clayton also stressed the importance of prompt compensation to victims and how early disclosure can play an important role toward these efforts. Speaking hypothetically, Clayton explained that in a scenario where someone is defrauded out of $100, and the government can return $70 immediately, "that's a lot better than getting them $90 in five years."

Potential Benefits to Cooperating Companies. In exchange for "quickly" disclosing misconduct, identifying potentially culpable actors, turning over relevant evidence and compensating victims, Clayton suggested that corporations would be eligible for a deferred prosecution agreement from the start (subject to ongoing cooperation) and possibly other benefits, including government-wide resolutions of collateral issues (for example, assistance with other agency action, such as industry bars). Additional benefits might include little or no financial penalties for genuine enforcement assistance.

Although Clayton did not explain just how quickly is "quickly," the emphasis on timeliness was noted. Though it is no surprise that the DOJ would want companies to disclose any information they may have voluntarily and sooner rather than later, companies facing such decisions must carefully assess the relevant facts and risks (which are substantial). It is interesting to note that during this talk, Clayton also shared that gun crimes and drugs are the SDNY Criminal Division's top priorities.

Conclusion

It appears that the DOJ is increasingly relying on carrots rather than sticks to encourage companies to self-disclose and cooperate. Time will tell if this approach proves effective in promoting increased cooperation and quicker resolutions in corporate investigations and potential prosecutions.

If you have any questions, please contact the authors or another member of Holland & Knight's White Collar Defense and Investigations Team.

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