Wall Street Cop Says Self-Reporting Firms Can Avoid Prosecution

Wall Street’s top prosecutor said companies that self-report fraud and financial misconduct affecting market integrity can avoid criminal charges under a new initiative.

Manhattan US Attorney Jay Clayton said Tuesday the new program establishes “clear guidelines and predictable treatment” for companies that voluntarily disclose certain kinds of criminal activity to his office.

Firms that report the violations, fully cooperate with law enforcement, commit to ongoing disclosure for three years and agree to mitigate harm caused by the activity won’t be prosecuted once they satisfy their obligations and repay victims.

“The self-reporting program rests on a simple principle: prompt corporate disclosure ...