The Department of Justice (DOJ) will end its third-party settlement practice, a controversial prosecutorial tactic critics deride as a scheme to finance the government’s political allies, and resolve cases without judicial oversight.
In a memorandum circulated internally Monday, Attorney General Jeff Sessions announced the DOJ would no longer ask corporate entities to offer a monetary award to a third party as a condition of avoiding prosecution. He said this settlement method largely serves “to bankroll special interest groups.”
“When the federal government settles a case against a corporate wrongdoer, any settlement funds should go first to the victims and then to the American people — not to bankroll third-party special interest groups or the political friends of whoever is in power,” Sessions said. “Unfortunately, in recent years the Department of Justice has sometimes required or encouraged defendants to make these payments to third parties as a condition of settlement.”
“With this directive, we are ending this practice and ensuring that settlement funds are only used to compensate victims, redress harm, and punish and deter unlawful conduct,” he added.