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In October, Deputy Attorney General (DAG) Lisa O. Monaco gave a Keynote Address at ABA’s 36th National Institute on White Collar Crime (Monaco Speech). Her remarks reframed a discussion about the uses of, reasons for and perceptions on independent monitors and monitorships. I asked Affiliated Monitors Inc. (AMI) founder Vin DiCianni for his thoughts around the remarks on monitors. He said, “For Affiliated Monitors this refreshed approach by DAG Monaco highlights the seriousness which businesses must place on the investment in their programs and in addressing what has for some been a negative experience with a monitor. For those who might be the subject of a monitorship, DAG Monaco recognized that the negativity that has sometimes surrounded monitorships as being punitive, should be seen in a different light bringing value, pointing a way forward and as a solution which has had great success in resolving matters.”
Monaco’s remarks should be studied by every compliance professional as they portend a very large change in the way the Department of Justice (DOJ) will utilize monitors going forward. Over this podcast series, sponsored by AMI, we will consider why DAG Monaco’s remarks herald a new era for monitorships. We will consider Monaco’s remarks from a variety of perspectives. Bethany Hengsbach discussed this change in monitorships from the white-collar enforcement and defense perspective. Mikhail Reider-Gordon looked at global aspects of the new DOJ monitor’s focus. Cristina Revelo discussed how ethics and compliance (E&C) assessments help drive more compliant companies. We will conclude the series with Vin DiCianni who will look at where monitorships are going in 2022 and beyond. In Part 4, Jesse Caplan, Managing Director of Corporate Oversight, brings his views on the twin topics of antitrust and healthcare compliance.
Both antitrust and healthcare have significant needs for monitorships. Antitrust concerns raised by the government can be handled through a monitorship of specific issues so that a merger can often go through and satisfy the regulators. This is a prime example of the DOJ or Federal Trade Commission (FTC) extending their reach so that anti-competitive issues do not arise or are properly remediated. Healthcare regulators are most interested in the continued delivery of healthcare services, particularly on the state and local level. It is not in anyone’s interest to stop the delivery of healthcare services which puts a hospital, healthcare practice group or doctor out of business, absent grievous circumstances. By using a monitor, a state regulator can help assure an appropriate level of compliance from a healthcare provider.
There were three key components from the Monaco Speech around monitors. Number one, that monitors are not viewed by the DOJ as punitive and should not be viewed as such by the compliance community or wider corporate community. Here Caplan observed, it is not the job of a monitor “to be punitive, but rather to facilitate a successful compliance program and a successful settlement agreement, works with both the government and for the company.” Number two is a monitor can act as an early tripwire to prevent companies from sliding into a recidivous situation. Number three, monitors bring a level of skill and talent around compliance programs and corporate culture that can help companies create a best practices program so the monitor actually works with the companies under an enforcement action to help them create a program that will be sustainable far down the road. Caplan said, a monitor can bring an “appreciation for what government enforcers are looking for, what the goals of government regulators are, as well as some of the challenges and goals of companies, who want to be successful and to do so in a compliant and fair manner.”
We then turned to the evolution of thinking of state regulators around monitors. Caplan noted, “some of these state Attorney General’s (AG) offices have realized for a long-time monitors can really be a resource extend for government agencies and particularly enforcement agencies.” He pointed to the example of the “Massachusetts Attorney General’s office, particularly with their Medicaid fraud control.” He went on to say, “more and more state AGs are using monitors when they enter in settlement agreement with conditions.” Using an independent allows an extension of their resources, to “verify that the company is compliant with those settlement conditions.”
Perhaps most powerfully, independent monitors can be seen as “an honest broker, bridging between the company and the regulator. Moreover, monitors can actually facilitate, a successful transition and then termination of a monitorship.” Caplan said, “we can do that because we can have candid conversations with both the company and then separately with the government, so that we can better understand where there might be disconnect between the two, and then we can help connect compliance up so that there’s not misunderstandings. There may be different expectations that end up sometimes torpedoing a settlement agreement and by having those conversations, by serving as that bridge, we can help prevent problems address so that ultimately the monitorship is successful.”
Affiliated Monitors
Jesse Caplan