Source: United States Department of Justice News
Thank you for the kind introduction. I appreciate the opportunity to share some thoughts with all of you today on the Antitrust Division’s global approach to criminal enforcement.
One of our values at the Antitrust Division, and the department as a whole, is to be clear with the public about our enforcement priorities, policies and the standards we apply in making charging decisions. And when we have issues and topics appropriate for reasoned discussion, we want to hear from a diverse set of views. For this reason, my colleagues and I appreciate the opportunity to participate in today’s conversations and describe the outstanding work by division prosecutors day in and day out to seek economic justice on behalf of our country.
Economic liberty is something cherished around the world. Looking at the enforcers, private practitioners, competition law experts, in-house counsel and former colleagues assembled in this room, there is at least one thing we share: We all want dynamic, vibrant economies, where innovation and entrepreneurship are encouraged. We need global supply chains and labor markets to work smoothly and international trade to flourish. Simply put, we all benefit when markets are free from collusion.
To accomplish this aim, effective antitrust enforcement requires a coordinated, global approach. When I say “global” I mean international in the literal sense. But I also mean a holistic approach. We are engaging more law enforcement partners and regulators, both in the U.S. and abroad. We are innovating as we embrace new technologies like data analytics and data science. We are expanding our toolkit, both in the statutes that we charge and the investigative strategies that we employ. We are investing in technology and personnel within the division to increase our investigation and litigation capabilities.
With that concept of “global” in mind, there are three topics that I’d like to address today:
First, I want to reaffirm some core principles for our criminal enforcement program that underlie this global approach.
Second, I want to share with you more about the proactive, comprehensive approach that the Antitrust Division is taking in our investigations and outreach. This approach both increases detection and in turn encourages companies to invest in compliance and, where compliance fails to prevent a violation, to avail itself of the leniency program.
Finally, I want to talk about some of the division’s important work in the international arena to deter and detect cartels and to help build capacity for antitrust enforcement around the globe.
Before I talk about how our criminal program is evolving and innovating, I want to place this work in the context of the Division’s long history of cartel enforcement. Over the years, our core principles have remained unchanged. Our leniency program relies on certain cornerstones: the threat of severe and significant sanctions, a heightened risk of detection, and transparent and predictable enforcement policies. As my predecessors have stated, for the program to be effective, rather than simply espousing these cornerstones, we have to reaffirm them continuously through our actions.
These are enduring lessons, which is why you can find some version of what I just said in speeches from every one of my predecessors dating back to the birth of the leniency program.
These cornerstones have been a constant throughout my time as a trial attorney, as a manager in the San Francisco Office, and now as Criminal Deputy. It is in this new role that I want to talk more about how we maintain transparency and predictability even as our criminal program evolves over time.
The pandemic reminded us how the world can change, and that we must adapt to those changes even though our mission remains the same. We cannot close our eyes to changing realities, like the opportunities and threats posed by AI, or the global pandemic and supply chain crisis, or increasing consolidation and inflation that hurts everyday Americans. Nor should we ignore the lessons we learn from seeing our policies play out in action, in the context of real investigations and of course, litigation. We must update our investigative techniques to tackle new technologies and ways to collude. And we need to foster productive dialogue with the broader community, including our fellow enforcers, government counterparts and practitioners and incorporate the valuable feedback and new ideas we hear.
So how can we ensure transparency and predictability even as our work evolves to meet our mission? We do this by ensuring our policies and practices are accessible. We write them down in the Justice Manual and in accessible public documents, and we speak publicly about our enforcement priorities and the concerns we’re seeing. And of course, the cases we file are the best guidance of all.
Our experience updating the Leniency Policy last year illustrates this point.
In our first revision to the Leniency Policy since 1993, the policy was incorporated into the Justice Manual. And the division also published a substantial update to our frequently asked questions as a means of clarifying the policy and consolidating the guidance from numerous speeches into a single source.
The goal of all of this was to increase transparency and predictability for everyone: from small mom-and-pop businesses to sophisticated multinationals.
The substantive changes were incremental, largely reflecting places where our practices had begun to diverge from the written policy. The core of the leniency policy has always been to encourage timely self-reporting by providing nonprosecution protection to only the first company or individual to self-report, and this of course is unchanged.
The policy updates also reflect the division’s consistent approach with the rest of the department. For example, the requirement that an applicant promptly self-report its misconduct mirrors the prompt reporting requirements in the Criminal Division’s Voluntary Self-Disclosure and Corporate Enforcement Policy and the USAO’s recent Voluntary Self-Disclosure Policy. In other respects, of course, the Leniency Policy differs from every other self-disclosure policy at the department in that it provides non-prosecution protections for executives.
Policies and priorities can and should evolve over time to ensure we are best meeting our mandate. But as the division has long done, when we make these changes, they are incremental, predictable, and clear to the public. Here today, the division is reaffirming its commitment to a criminal enforcement program that is predictable and transparent.
As I turn to my next topic of proactive investigations and outreach, I will begin by referencing another cornerstone: the risk of detection.
As the division has long recognized, this cornerstone is critical to an effective leniency program. The more a company is concerned that we will discover its criminal conduct, the more likely it is to report its wrongdoing and provide valuable cooperation in exchange for leniency.
So under Assistant Attorney General Kanter’s leadership, we are laser-focused on increasing the risk that cartel conduct will be detected — not only to maintain the incentives for a wrongdoer to seek leniency, but also to make sure that antitrust risk is front and center when companies are deciding where to invest in compliance, and to best position our prosecutors to investigate and bring cases without a leniency applicant when necessary. As time and experience has shown, conspiracy cases based on immunized testimony have unique challenges.
With all that said, how do we maximize detection?
We start with law enforcement, by expanding the reach of the Antitrust Division by working with partners who are force multipliers.
Increasingly, antitrust investigations and prosecutions are not being run by the Antitrust Division alone but are being conducted in consultation and often coordination with local U.S. Attorneys’ Offices.
The Procurement Collusion Strike Force (PCSF), first launched in 2019 and led by my colleague Dan Glad, serves as a model for this interagency approach.
The PCSF initiative shows the force multiplier concept at work. Through the PCSF, antitrust prosecutors in the five criminal offices of the Antitrust Division can collaborate through preexisting partnerships with more than twenty U.S. Attorneys’ Offices around the country.
In addition to the FBI, the PCSF also adds ten more federal law enforcement agencies that can assist in Antitrust Division investigations, including investigators in Offices of Inspector General that have subject matter expertise in everything from defense contracting to energy production.
We are also bringing new tools to bear, such as data analytics. To that end, the PCSF Data Analytics Project works to encourage the application of data analytics to procurement data throughout the federal government. This training, which has included investigators, analysts, auditors, and data scientists for various federal agencies with procurement and investigation functions, focuses on recognizing suspicious bid patterns and identifying other red flags of collusion.
In addition, the Antitrust Division is investing in cutting-edge collusion detection methods by building our internal capacity. As has been publicly announced, the division is actively hiring data scientists to work alongside its attorneys and economists.
I want to address my final point to the in-house counsel in the room, which is the affirmative outreach that we conduct and the complaints that we receive from industry participants.
While many of these efforts are not in public view, there are important outreach efforts that the Antitrust Division does publicly announce for purposes of deterrence and lead generation. For example, in February 2022, the Antitrust Division announced a global supply chain initiative to deter and detect price fixing and other collusive schemes aimed at exploiting global supply chain disruptions and other inflationary pressures following the Covid-19 pandemic.
When talking to would-be complainants, a question that we get often is whether the Antitrust Division will treat the information they provide confidentially. The answer is yes.
It is the Antitrust Division’s consistent practice to “protect the identity of complainants and the information they provide to the full extent of the law.” We treat this information like we would if it came from any confidential human source that is assisting an investigation. We know it is a difficult decision to blow the whistle on a trading partner, even if it the right thing to do to prevent wrongdoing against other victims. For this reason, we are happy to have off-the-record, anonymous conversations with complainants to further explain how confidentiality works in practice during our investigations.
I say all of this in this forum because many of the members of this audience work for companies that might be witnesses to anticompetitive conduct. These risks are especially acute given continued supply chain disruptions and inflationary pressures that impact the macroeconomy.
Upstream suppliers, downstream customers, distributors, retailers, and other types of market participants are uniquely positioned to detect cartel behavior in their respective industries. These companies can serve as an early warning system.
It may be an overlooked aspect of corporate compliance training. You are likely to see red flags and indicia of collusion before we do, especially in your procurement departments.
Such training can limit or even avoid criminal sanctions on the one hand, and potentially allow for recovering damages on the other.
I can say that the Antitrust Division currently is — and will continue — working with individuals and responsible corporate citizens in the business community as part of our ongoing efforts to identify criminal conduct.
As part of those efforts, we are taking steps to encourage and protect individual whistleblowers. As you may be aware, individual whistleblowers now receive protection under the Criminal Antitrust Anti-Retaliation Act (CAARA) when assisting in antitrust investigations. We are also looking at ways to promote access via our website and Citizen Complaint Center so that members of the public can register antitrust complaints and concerns more efficiently.
As a result of these efforts, and others that I have not mentioned, the Antitrust Division is pursuing proactive investigations at a pace not seen in decades.
Many of these matters are intelligence-driven at their inception and involve consultation with other antitrust enforcers. Other proactive investigations are predicated on complaints from industry participants, tips from citizens, and referrals from other agencies.
Having now visited with prosecutors in all five of our offices with acting director Emma Burnham, we are continually impressed by the creativity and persistence with which they are pursing investigative leads across a range of industries and geographies alongside their law enforcement partners, using the full complement of investigative techniques. It is truly something behold and one of the best parts of my new role.
My final topic today is how engagement at the international level is a critical component of our global approach to cartel detection and deterrence.
For decades, the United States has promoted international engagement and the adoption of criminal cartel enforcement. Today, more jurisdictions than ever before are effectively investigating and seriously punishing cartel offenses.
This topic could not be more timely. Next week, the division will be participating in meetings of the OECD’s Competition Committee, including a roundtable on Cooperation and Enforcement. The Competition Committee facilitates exchanges of views on competition policy issues, and since adopting its Hard Core Cartel Recommendation 25 years ago, it has played a critical role in making cartel enforcement a priority around the globe. Those meetings are an important opportunity for the Antitrust Division and our international counterparts to learn from each other.
That regular engagement with our fellow enforcers runs a broad spectrum from case-specific cooperation, to sharing leads and ideas for investigative methods, to productive dialogues that inform our respective policies. All of those collaborations make us more effective enforcers within our respective jurisdictions, many of which now prosecute collusion criminally. They help us root out transnational collusion. In an increasingly globalized economy, they maximize our ability to promote competitive markets around the world.
Much of this engagement among enforcers, including at OECD, happens outside the view of the defense bar and business community. There are good reasons why not all of our conversations can be public, including to preserve confidentiality and maximize candor on sensitive issues. But we balance those needs against another set of critically important values: transparency, predictability, and equal access to justice — a key priority of the entire Justice Department. That is why I am pleased to preview a few of the topics that have been on my mind as I engage with my colleagues around the world, why these remarks will be published on our public website, and why I look forward to further engagement with the broader bar, business community, and public.
The OECD event is one of several ways in which we are working to bring the international antitrust enforcement community closer together, perhaps more so than at any point in the history of the division.
In March 2023, the Antitrust Division, along with our sister agency the Federal Trade Commission, hosted an Enforcers’ Summit in Washington, D.C. The summit convened enforcement agencies from the United States and around the globe “to discuss enforcement priorities and strategies for effective coordination.”[1]
The Antitrust Division also serves as a co-chair of the International Competition Network’s Cartel Working Group. Alongside our counterparts from Chile and Italy,[2] the Antitrust Division launched a multi-year project called “Back to Basics,” a series of experiential learning programs designed to help ICN members improve cartel detection and enforcement techniques.
The Antitrust Division is also working to expand successful national initiatives to the international level. Building on the success of the Procurement Collusion Strike Force, the PCSF: Global initiative was launched with an inaugural presentation to the OECD’s Competition Committee in 2020. PCSF: Global has already conducted workshops, trainings, and presentations in countries ranging from the Republic of Korea to Bosnia-Herzegovina, and to audiences including U.S. and foreign criminal investigators, prosecutors, analysts, and auditors. Not surprisingly, the PCSF has already recorded its first successful international prosecution, which yielded a significant criminal fine for a price-fixing conspiracy targeting the United States Department of Defense.[3]
Finally, as I previously mentioned, as part of the global supply chain initiative, the Antitrust Division is working with a number of antitrust enforcers around the globe, including the United Kingdom’s Competition and Markets Authority — I understand that you will be hearing from my colleague Juliette Enser later today, European Commission’s Directorate General for Competition, the Australian Competition and Consumer Commission, the Canadian Competition Bureau, and the New Zealand Commerce Commission.[4] The Division’s investigative efforts have benefitted greatly from these and other bilateral and multilateral conversations, and I expect that you will be seeing the fruits of these collaborations in our future enforcement activities.[5]
Today, you will hear from a number of division leaders and highly experienced cartel practitioners. I encourage you to attend the panels with my colleagues Jim Fredricks, the chief of our Washington Criminal II Section, Carolyn Olson, who is acting chief of our Washington Criminal I section and Special Counsel Andrew Schupanitz. I know that you will appreciate their insights, which are informed by their exemplary work leading the Division’s investigations and litigation.
We welcome the opportunity to share our thoughts with you all today and facilitate a public dialogue based on shared values, like promoting competition. While the adversarial setting of a courtroom is like second nature to many of us, let us not forget that there is also much we accomplish when we listen to each other. I look forward to today’s conversations. Thank you.
[1] https://www.justice.gov/opa/pr/justice-department-and-federal-trade-commission-hold-annual-spring-enforcers-summit.
[2] Chile’s Fiscalía Nacional Económica (FNE) and Italy’s Autorità Garante Della Concorrenza e del Mercato (AGCM).
[3] See U.S. DOJ Office of Public Affairs, Belgian Security Services Firm Agrees to Plead Guilty to Criminal Antitrust Conspiracy Affecting Department of Defense Procurement, (June 2021) available at ttps://media.defense.gov/2021/Jul/09/2002758992/-1/-1/1/210625_BELGIAN-SECURITY-SERVICES-FIRM-A.PDF.
[4] Richard A. Powers, Keynote at the University of Southern California Global Competition Thought Leadership Conference, (June 2022) available at https://www.justice.gov/opa/speech/deputy-assistant-attorney-general-richard-powers-delivers-keynote-university-southern.
[5] Manish Kumar, Deputy Assistant Attorney General, Remarks at Second Annual Spring Enforcers Summit, (March 2023) available at https://www.justice.gov/opa/speech/deputy-assistant-attorney-general-manish-kumar-delivers-remarks-second-annual-spring.