{"id":16543,"date":"2026-09-24T17:48:29","date_gmt":"2026-09-24T17:48:29","guid":{"rendered":"https:\/\/www.americanconference.com\/fcpa-dc\/?page_id=16543"},"modified":"2026-09-28T16:16:39","modified_gmt":"2026-09-28T16:16:39","slug":"when-a-self-disclosure-ends-in-a-declination-lessons-from-recent-case-studies","status":"publish","type":"page","link":"https:\/\/www.americanconference.com\/fcpa-dc\/when-a-self-disclosure-ends-in-a-declination-lessons-from-recent-case-studies\/","title":{"rendered":"When a Self-Disclosure Ends in a Declination: Lessons from Recent Case Studies"},"content":{"rendered":"
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When a Self-Disclosure Ends in a Declination: Lessons from Recent Case Studies<\/h1>\r\n

By Jaclyn Jaeger<\/p>\r\n

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Imagine this scenario: As in-house counsel for your organization, you\u2019ve just uncovered potential misconduct in the course of an internal investigation. The decision is made to self-disclose the matter to relevant enforcement authorities. Then comes an important follow-up question: What\u2019s next?\r\nCiting lessons learned from two recent declinations, this article explores how a voluntary self-disclosure changes what the Department of Justice (DOJ) will expect from the company and corporate counsel during its investigation. To assess the potential outcome of a self-disclosure under the current enforcement environment, a necessary starting point is to review the DOJ\u2019s \u201cCorporate Enforcement and Voluntary Self-Disclosure Policy<\/a>\u201d (CEP), which was updated and reissued in March to apply to \u201call corporate criminal matters handled by the Criminal Division.\u201d<\/p>\r\n

\u201cThe Department\u2019s policies afford companies that take responsibility for their misconduct with a clear path to a declination,\u201d stated NFED Assistant Attorney General Colin McDonald. \u201cBusinesses that ignore the law and profit from their executive\u2019s lies and deceit will be held accountable.\u201d<\/p>\r\n \r\n

Relevant case studies<\/h5>\r\n

Since the Department-wide CEP has been released, the DOJ has announced two declinations that provide several practical takeaways for companies and corporate counsel. The first declination<\/a>, announced March 19, resulted from a foreign bribery investigation into Balt SAS, a medical-device company headquartered in France.<\/p>\r\n

According to a \u201cletter agreement<\/a>\u201d from the DOJ\u2019s Fraud Section to Balt\u2019s counsel, the government\u2019s investigation \u201cfound evidence\u201d that, from 2017 to 2023, approximately $602,000 in bribes was paid to a senior-level physician at a \u201cstate-owned\u201d hospital in France in exchange for the hospital purchasing certain of Balt\u2019s medical devices.<\/p>\r\n

An earlier internal investigation conducted by Balt found that the individual involved was a former executive of Blockade Medical, a company acquired by the BALT Group in 2016. After discovering the misconduct during its internal investigation, Balt self-disclosed the matter to both the DOJ\u2019s FCPA Unit and the Parquet National Financier (PNF) in France.<\/p>\r\n

Like many bribery schemes, common elements included the use of a third-party consultant to pay the bribes and attempts to conceal the bribery payments, in this case with sham consulting agreements, fake invoices, and bonus payments. What was unique about this case, however, is that the DOJ said the physician met the definition of \u201cforeign official\u201d under the Foreign Corrupt Practices Act (FCPA), which signals how broadly the government can define that term under the FCPA.<\/p>\r\n

In a second case, the NFED on July 29 announced<\/a> its first declination of a healthcare company under the new CEP. That resolution concerned a criminal healthcare fraud investigation into management services organization, Campus Eye Management Holdings, and its wholly-owned subsidiary, Campus Eye Management, for \u201chealth care fraud, illegal kickbacks and bribes, and conspiracy,\u201d the DOJ stated.<\/p>\r\n \r\n

Key factors<\/h5>\r\n

Both cases offer lessons learned for companies and corporate counsel by highlighting four key factors that the DOJ will consider for a company that self-discloses to receive a declination, as set forth in the CEP.<\/p>\r\n\r\n\r\n\"FCPA<\/a>\r\n\r\n

Timely and voluntary self-disclosure<\/strong>: In both cases, the companies were credited with making timely and voluntary self-disclosures. In Balt\u2019s case, the misconduct was \u201congoing at the time of the disclosure,\u201d according to the DOJ.<\/p>\r\n

The DOJ\u2019s Whistleblower Awards Pilot Program<\/a> makes the timely reporting of a self-disclosure even more important. Even with a whistleblower report, the company may still qualify for a declination, as long as it self-reports the conduct \u201cas soon as reasonably practicable but no later than 120 days after receiving the whistleblower\u2019s internal report,\u201d the CEP states. A regulatory audit and\/or adverse media report are other factors that make a timely self-disclosure critical.<\/p>\r\n \r\n

Full cooperation<\/strong>: In both cases, the companies also received credit for their \u201cfull and proactive cooperation\u201d and their agreement to \u201ccontinue to cooperate with any ongoing government investigations and prosecutions.\u201d<\/p>\r\n

Another critical element \u2013 shared by both cases \u2013 was the ability of the DOJ to hold accountable those who played a central role in the misconduct. The CEP explicitly states that a company fully cooperates when it \u201ctimely, truthfully, and accurately discloses all facts and non-privileged evidence relevant to the conduct at issue, including\u2026facts and evidence about all individuals involved in or responsible for the misconduct at issue.\u201d\r\nIn the Balt case, for example, two co-conspirators behind the misconduct were indicted \u2013 David Ferrera, an executive at Balt\u2019s U.S. subsidiary; and Marc Tilman, who was hired by Balt\u2019s U.S. subsidiary as a consultant. In the Campus Eye case, the founder of the optometry practice and ambulatory surgery center was indicted for his role in that scheme.<\/p>\r\n \r\n

Timely and appropriate remediation<\/strong>: Timely and appropriate remediation commonly involves taking disciplinary action against relevant individuals; terminating the business relationships that gave rise to the misconduct; tailoring anti-corruption compliance training; and enhancing compliance program and internal controls. Remediation can also vary sector-by-sector. For example, Campus Eye\u2019s required remedial measures included, in part, \u201can internal review and subsequent revision of certain billing, payment, and compensation policies.\u201d<\/p>\r\n \r\n

No aggravating circumstances<\/strong>: Both cases also had no aggravating circumstances, which can include \u201cthe nature and seriousness of the offense, egregiousness or pervasiveness of the misconduct within the company, severity of harm caused by the misconduct, or corporate recidivism,\u201d the CEP states.\r\nLastly, as required by the CEP, Balt agreed to disgorge ill-gotten gains (a total of $1.2 million), while Campus Eye case agreed to pay back $1\u202fmillion to victims of the scheme. <\/p>\r\n \r\n

Practical takeaways<\/strong><\/p>\r\n

Not all scenarios will result in a declination. The CEP contains a flowchart of questions to help determine the likely outcome of a self-disclosure \u2013 whether it will lead to a declination, an NPA, or prosecution. Companies and corporate counsel should refer to this flowchart when deciding whether a self-disclosure is in the best interest of the company.<\/p>\r\n

Assuming a decision has been made to self-disclose, however, the next step is to craft a carefully planned strategic response, including:<\/p>\r\n