Despite substantial changes in regulatory philosophy, particularly the DOJ’s recently amended policy regarding the selection of monitors in Criminal Division matters, we believe that regulators will continue to require independent monitors and independent consultants in settlements where the regulatory authority requires assurance that remedial measures have been implemented and are operating effectively.

The amended DOJ policy provides that the Criminal Division should favor the imposition of a monitor only where there is a demonstrated need for, and clear benefit to be derived from, a monitorship relative to the projected costs and burdens. Where a corporation’s compliance program and controls are demonstrated to be effective and appropriately resourced at the time of resolution, a monitor will likely not be necessary. A current trend is for entities to achieve reasonable compliance, through their own efforts or those of an independent third party, before entering into the actual settlement so that firms receive credit for effective remediation as part of the settlement terms.