Corporate guilty pleas fall to 12 as DOJ closes probes with no charges

Prosecutors close Alibaba, EagleBank probes without charges

The Trump administration has moved sharply away from charging companies over the wrongdoing of employees, recently closing a string of criminal investigations with lenient resolutions or no charges at all, according to The Wall Street Journal.

In matters involving Alibaba, EagleBank and Abbott Laboratories, the Justice Department declined to charge companies even when prosecutors thought executives or managers were involved in the wrongdoing. In those cases, the department didn’t charge any individuals.

Corporate investigations and prosecutions that were happening a few years ago “have pretty much been dialed way back,” said Evan T. Barr, a former federal prosecutor now with the law firm Reed Smith. “So if you’re in the world of financial services or a large public company, you can breathe a lot easier.”

Charging companies is the strongest weapon in the Justice Department’s arsenal for punishing businesses that violate the law, the Journal noted. Convictions can send a strong message that wrongdoing carries public consequences. But businesses say they can also hobble a firm’s ability to get financing or compete for federal contracts, and other critics say that tends to hurt shareholders and employees more than executives.

In some cases, prosecutors have spared big companies from that risk by putting them on a form of corporate probation known as a deferred prosecution agreement. If the company avoids trouble over a period of several years, the Justice Department dismisses its charges. Companies typically admit to their violations, pay fines and undertake compliance and leadership changes.

The Justice Department says companies aren’t being let off easy. “All corporate cases that the department resolved this year were done so in a public fashion and were driven by the facts, the evidence, and the law—not a preference for any particular outcome,” Assistant Attorney General Tysen Duva said.

Over the past few years, the Justice Department obtained guilty pleas from about 60 companies a year, according to data from law firm Gibson Dunn. So far this year, 12 companies have pleaded guilty to federal criminal charges. At least six companies have reached deferred prosecution agreements, including refiner Phillips 66 and medical-waste specialist Stericycle, acquired by Waste Management in 2024.

Acting Attorney General Todd Blanche has said prosecutors shouldn’t view prosecuting companies as their goal and should instead focus on holding individual wrongdoers accountable. “Companies don’t go to jail, people do,” Blanche said in a December speech. “The strongest deterrent to future misconduct is seeing a corrupt executive held to account.”

The Justice Department this year dropped its long-running prosecution of Turkish state-owned lender Halkbank for allegedly evading U.S. sanctions on Iran. Last year, the Trump administration dropped charges against Boeing, which had been set to plead guilty to misleading air-safety regulators but instead paid a $243 million fine and received a nonprosecution agreement.

In the Alibaba case, prosecutors had wanted to charge the Chinese e-commerce giant with felonies, including violations of the Federal Food, Drug, and Cosmetic Act and the Controlled Substances Act, according to people familiar with the matter. Some of the prosecutors thought Alibaba should have been required to plead guilty, the people said. In the end, Alibaba admitted that it processed more than $200 million in illicit sales of pharmaceuticals, chemicals and equipment such as pill presses that could be used in the manufacturing of illegal drugs, according to the nonprosecution agreement it received. Alibaba agreed to pay $325 million to the government in fines and forfeiture.

Prosecutors last month resolved a probe of Bethesda, Md.-based EagleBank without levying charges. In its nonprosecution agreement, the lender admitted that it allowed a favored client whose father was in business with the bank’s then-chief executive to write checks he didn’t have the cash to cover. EagleBank also approved the client for a federally guaranteed loan even after a top lending officer ruled it was unsound. EagleBank backdated the client’s loan payments to make it appear as though they were on time, the settlement says.

While Blanche and others have indicated the department is focusing on prosecuting employees rather than companies, it has also granted leniency or dropped charges against people it accused of wrongdoing. The department in January gave a deferred prosecution agreement to the chief executive of a technology contractor who had been charged with defrauding the Securities and Exchange Commission. The Justice Department this month suspended the prosecution of three former executives of Australian shipbuilder Austal, which pleaded guilty in 2024 to securities fraud and obstructing a Defense Department audit of its finances. The department instead recommended the defendants be diverted to a program for first-time offenders that allows them to have the charges dismissed.

White-collar lawyers say the Trump administration doesn’t seem to be emphasizing the strategy of offering leniency to companies in exchange for identifying and prosecuting the individuals who committed crimes. “My general sense is corporations are being treated much more leniently,” said Robert Luskin, a white-collar lawyer at Paul Hastings. “What I don’t see is a corresponding rise in individual prosecutions.”