The Department of Justice adopted the McNulty Memorandum concerning prosecution of corporate fraud. The new policy provides suspects with more protection for attorney-client privileged information and information obtained via an internal corporate investigation. Previous Justice Department policy was criticized as chilling attorney-client communications and hurting corporate internal investigations.
Prosecutors need senior Justice Department approval before requesting privileged or internal investigation information. Also, corporations can no longer be given cooperation credit for cutting off the payment of legal fees to executives or employees. Prosecutor's pressure to cut off legal fees to executives was held to violate the executive's Fifth and Sixth Amendment rights. United States v. Stein (June 27, 2006), S1 05 Crim. 0888. Companies may still get credit for waiving attorney-client privileged information. See DOJ Revises Corporate Fraud Procedures by Jason McClure, Legal Times, Dec. 13, 2006; Kaplan Blasts U.S. Pressure on KPMG Case Fees by Mark Hamblett, NY Law Journal, June 28, 2006.