Timing Your Cooperation: Before or After Indictment??

One benefit of cooperating with the government prior to a federal indictment is that the target of the investigation can attempt to influence the decision whether to bring an indictment, the nature of the charges, and/or sentencing. One potential disadvantage is that a target is generally not entitled to discovery prior to formal charges. This means that a target does not know where they stand, and they may make incriminating statements not knowing that they are and may become subject to substantial evidence produced by the government.

After an indictment, discovery is available, and this materially improves the target’s ability to assess the evidence in the government’s possession and to know where they stand in the case. The federal criminal indictment does not legally preclude a defendant from later cooperating with prosecutors, and it does not bar a defendant from being able to obtain substantial assistance relief as a result of cooperation.

Federal criminal investigations can go on for months or even years before the government presents charges to a grand jury. When you receive a federal target letter, this is notice that you are being investigated for a criminal matter; but it is not a criminal charge. It is simply the government notifying you of an investigation. A target can proactively approach the prosecutors to discuss the target’s willingness to cooperate even before an indictment has been issued.

A federal indictment is an accusation that a person has committed a crime and is therefore subject to prosecution in a criminal case. It is returned by a grand jury that finds probable cause that the defendant committed the offense. If the federal government proceeds with a criminal indictment, it is because the prosecutors decided that it was in the best interest of the government to go to trial rather than offering a plea or avoiding indictment by a target’s cooperation.

How do I Decide When Cooperation has the Most Value?

If presenting cooperation information (proffering) is in your best interest, offering early assistance presents these opportunities:

• Helping investigators find evidence, identify witness(es), or uncover additional targets.
• Helping prosecutors assemble their case early, which creates more leverage for later use.

The risks of cooperation prior to the issuance of an indictment or as a result of a proffer include:

• Prosecutors may not reveal the evidence they have before you offer to cooperate.
• Prosecutors do not have to offer concessions for providing information, and they do not have to file a motion for sentencing reduction on your behalf.
• Prosecutors may decide to move forward with the indictment anyway, without taking your information into account.

Proffers are negotiations. We examine your information to assess its value. While informative information can be useful, the more you have, the better. The more you can offer that is not duplicative, the more likely the government is to offer something substantial in return. Information identifying new targets for the government’s case is even more valuable than presenting information about the target of the case at hand.

Under U.S.S.G. §5K1.1(a)(5), timeliness and effectiveness of assistance are factors for prosecutors to take into account when filing a substantial assistance motion. Proffering early on allows the government more time to examine and corroborate your information, and to use other resources to develop the case before it is charged in court or goes to trial.

The closer the plea deadline or trial date, the harder it is for the government to investigate and use assistance provided. The closer to trial, the more likely a defendant will ask the government to use assistance, and the more likely the government will have to take the risk to move the trial date.

Prosecutors will not file motions for substantial assistance (5K1.1 motions) if they do not get new information. If prosecutors have already indicted multiple individuals in the case and the case is moving toward trial, the window for presenting new information is decreasing. The more the government gets a better grip on the case and witnesses to rely on, the harder it is to present new evidence and witnesses that the government may be able to use.

If other targets face the same situation, they also have the same motive. If you think others are trying to present information to prosecutors to help their own situation, you must decide if you want to cooperate as well. If the targets are likely to compete to help the government’s case, a joint representation by one law firm is not feasible.

What protections does a federal proffer agreement actually provide?

Formal cooperation commonly starts with a lawyer-negotiated proffer session. In this case, your defense counsel reaches a written agreement with the government, and you make a voluntary statement during a meeting with prosecutors. This is done in the hope that your voluntary disclosures will be useful to the investigation, and that your assistance will either prevent criminal charges or result in a substantial-assistance sentence reduction under U.S.S.G. § 5K1.1.

As a result of the formal nature of this agreement, several points need to be clear:

A Proffer Agreement Is Not Immunity

First, a proffer agreement is not the same as immunity. Immunity does not allow a suspect to face criminal charges. A proffer agreement does not prevent a suspect from being charged for any offense. A proffer agreement prevents prosecutors from using the defendant’s voluntary statements (or admissions) to prove the defendant’s guilt in court.

Proffers Can’t Be Used in the Case-in-Chief

Many proffer agreements include language that limits the direct use of the defendant’s voluntary statements. Specifically, the defendant’s voluntary disclosures may not be used against him/her in the prosecution’s case-in-chief. This is a broad protection that keeps the defendant safe from a direct attack from prosecutors. But, this is usually not enough to keep the speaker safe during a proffer session.

Investigative Leads May Still Be Used

Even if a defendant is protected by a proffer agreement, he/she could still face criminal charges. As a result of the proffer agreement, the government may use investigative leads produced from a proffer to obtain other evidence, witness(es), or documents that prove the speaker’s guilt. If the government is able to prove the speaker’s guilt through evidence derived from the proffer but found by independent sources, this evidence is admissible.

These protections apply if the cooperation session is in accordance with the terms and conditions in the proffer agreement. If the defendant violates any of these terms, the agreement will be void.

Protections Depend on the Written Agreement and the District

The protections afforded by proffer agreements also depend on both the particular written agreement and the practice in the U.S. District Court in which the case is pending. There are no standard forms for proffer agreements. Each agreement is the result of a negotiation that takes the facts and circumstances of a case into account.

As a result of this fact, different proffer agreements provide different protections.

Proffers May be Used to Impeach a Defendant’s Testimony

In United States v. Mezzanatto, the Supreme Court of the United States held that defendants can waive the protection afforded by Rule 410. As a result, many proffer agreements will include a waiver of this rule, and prosecutors can use your voluntary statements against you for purposes of impeachment. This is not automatic. But, in most federal criminal cases, this is a standard part of a proffer agreement.

Impeachment occurs when the defendant makes a statement during a trial that is not consistent with the voluntary admissions that he/she made during a proffer session. In the criminal case in which you made voluntary admissions during a proffer session, those admissions can be used against you if they are needed to rebut any statements you make in court.

Is Section 1B1.8 Protection the Same as Immunity?

The general concept of immunity refers to a situation in which the government cannot prosecute a person even if he or she has committed a crime. There are different types of immunity in the United States legal system.

One type of immunity is transactional immunity. In transactional immunity, the government gives someone immunity for an entire offense or entire offenses. As a result, once someone is granted transactional immunity, the government cannot prosecute him or her regardless of what information he or she provides or how it is obtained.

Another type is use immunity. This type of immunity does not prevent a person from being prosecuted for a crime; but it prohibits the use of a person’s testimony or documents that are compelled to prove the person’s guilt. This is also covered by the statutory definition of “compelled testimony or documents” under 18 U.S.C. §6002. This federal statute expressly prohibits the use of compelled testimony or documents in the prosecution of the person.

In contrast, under Section 1B1.8 of the United States Sentencing Guidelines (U.S.S.G.), you are only protected in the case in which the government expressly agrees not to use information that you knowingly and voluntarily disclose. Your lawyer must ensure that the government agrees that information that may be self-incriminating won’t be used to determine a Sentencing Guidelines offense level. Even though you’re not testifying in order to protect yourself, Section 1B1.8 allows you to avoid using a Sentencing Guidelines calculation that may have higher values. Section 1B1.8 explicitly excludes information already known to the government, meaning that this section does not protect you from information known in the course of investigations before you volunteered information.

Under Section 1B1.8, information that you knowingly and voluntarily disclose to the government is not available if you breach your cooperation agreement. The agreement may grant you the benefits of receiving a sentence reduction under §5K1.1, and if you breach it, this section will not apply. When you decide to cooperate, your lawyer should try to negotiate the protection under Section 1B1.8 and also ensure you receive benefits under Section 1B1.1 by cooperating with the government.

Proffer admissions can expose previously unknown conduct and can increase the sentencing calculation in criminal cases. A proffer agreement may provide a certain amount of protection, but it does not provide absolute protection. You may be able to receive a lower offense level under Section 1B1.8, but if you are not able to obtain an agreement not to be charged, this does not prevent you from being prosecuted for the crime you admitted.

Todd Spodek and the attorneys at Spodek Law Group handle federal cases of this kind from New York, Brooklyn, Queens and Los Angeles.

What Can Cooperation Change About My Charges and Sentence?

Only the government may file a motion seeking a substantial-assistance departure under Section 5K1.1 of the Sentencing Guidelines. As a result of this, the court may allow a substantial-assistance departure below the advisory sentencing guidelines range only when the government files a motion seeking a downward departure under Section 5K1.1. An individual seeking federal sentencing relief can do so by pleading guilty and cooperating with prosecutors.

A §5K1.1 motion alone does not authorize the court to impose a sentence below a statutory mandatory minimum. For a statutory mandatory minimum to be breached, the government must also file a motion under Section 3553(e), which states that a sentence below a mandatory minimum is warranted in the interest of justice because of the defendant’s substantial assistance.

Defendants often confuse charging concessions, §5K1.1 departures, and the possibility of a Rule 35(b) reduction. A charging concession is a bargain that prosecutors enter into with a defendant. In this scenario, the target of the investigation avoids an indictment or proceeds toward trial with fewer counts or with charges that will not carry mandatory minimum sentences. A §5K1.1 departure, however, has to do with sentencing after the judge has found the defendant guilty or the defendant has pleaded guilty.

A Rule 35(b) reduction is a post-sentencing motion that the government files when a defendant has provided substantial assistance. Although Rule 35(b) is not to be confused with a §5K1.1 motion, this motion will be presented to a judge for a decision.

Even without a government motion under §5K1.1, sentencing courts can take into account the defendant’s cooperation when sentencing under 18 U.S.C. Section 3553(a). Section 3553(a) is the section of the U.S. Code that imposes requirements on the sentencing court. Specifically, the judge must weigh several factors that are relevant to sentencing based on the details of the crime, and the sentencing judge considers these factors to determine a defendant’s sentence. One of these factors is the person’s assistance during the investigation and prosecution of the offense. In this regard, you do not need the government to file a §5K1.1 motion for the court to consider your cooperation when considering your sentence.

However, if there is a mandatory minimum sentence in place, the judge cannot impose a sentence below that minimum unless authorized by statute. In this case, the defendant cannot request such a departure without statutory authority. The only time that statutory authority exists is when the government presents a required motion under Section 3553(e) to the sentencing court.

What Risks Can Cooperation Create Outside the Criminal Sentence?

The narrow protections available under a proffer agreement do not necessarily bind other entities. For example, tax agencies, state and federal licensing bodies, and other civil litigants may be able to obtain the evidence disclosed during the proffer and use it against you. As a result, any attempt at cooperation must be carefully balanced by your defense counsel.

Proffered information may provide support for allegations of criminal forfeiture in certain types of criminal cases. The government can also file a parallel civil forfeiture case and use the proffered information to support its case. Also, voluntary admissions in a proffer may qualify as admissions that violate the immigration law. 8 U.S.C. §1182(a)(2) denies admission of aliens convicted of offenses relating to controlled substances.

If you’re a qualified witness in a high-profile case and you’re concerned about your safety or that of your family, this can change your mind about proceeding with a criminal trial. In this case, 18 U.S.C. §3521, the United States Federal Witness Security Program or “WITSEC,” authorizes the Attorney General to provide protection for the witnesses. Additionally, prosecutors have the authority to protect family members who are endangered as a result of the witness’s participation in the criminal investigation or trial.

Can the Public Find Out About the Cooperation?

It depends on the district in which the case is pending. The cooperation agreement between the government and the target will be filed, and this filing is generally a public record. However, some district judges may allow the filing to be under seal. But, you must talk to your lawyer about this possibility.

Can the Attorney I Have Also Represent the Defendant’s Co-Defendants?

The defense attorney’s right to represent multiple defendants is not absolute. The attorney cannot represent the defendant or co-defendants if he has interests that are contrary to one of the defendants’ interests. As a result, when any of the clients present a possibility for cooperation, this triggers a conflict. Under Rule 44(c), judges are required to inquire about the potential for joint representation of codefendants and determine if there are conflicts of interest. With an effective defense strategy, this situation should be avoided.

What Happens If Prosecutors Reject or Break the Cooperation Deal?

First, you have to make sure that you can strictly adhere to the cooperation agreement. A typical proffer agreement requires the defendant to truthfully and completely disclose all information about his/her own conduct and about the conduct of other people. If the defendant does not comply with these requirements, it constitutes a breach of the cooperation agreement. As a result, the government can seek the sentence based on the allegations of a crime, and no reduction or concession will be offered.

The second is that even if the prosecutors file the motion for a substantial-assistance reduction, the sentence the defendant requested might not match the sentence the judge imposed. In the case of Wade v. United States, the defendants accused the U.S. government of making decisions based on unconstitutional motives. For example, the defendants alleged that the U.S. government denied them the opportunity to file an affidavit that would prove the defendants had assisted the government. In Wade v. United States, the U.S. Supreme Court held that a substantial-assistance motion alone did not warrant an evidentiary hearing.

If the prosecutors offer a deal but then break their promise to the defendant, a different analysis applies. In Santobello v. New York, the Supreme Court held that when the government makes promises based on the defendant’s plea of guilty, the government is obligated to honor these promises. If prosecutors make an promise based on a defendant’s plea of guilty, the promises are part of a binding contract and cannot be withdrawn unless both parties agree to this or the parties’ agreement does not apply. If the prosecutorial promise is broken, this can result in the withdrawal of the defendant’s guilty plea or the order of specific performance by the sentencing court.

What happens if the prosecutors are not interested in the information you present or if the prosecutors decided to file a different plea deal to preserve their case? Your lawyer can discuss these options with the prosecutors and determine the appropriate step. In this case, the court will apply the principles of contract law and other due-process rights to interpret the agreement. The defendants who received such a benefit can have the court’s authority to order specific performance if the agreement does not apply.

The judge does not have the authority to initiate a §5K1.1 substantial-assistance or §3553(e) motion.

Talk to Spodek Law Group

Every case turns on its own facts, and general information is no substitute for advice about yours. Todd Spodek, managing partner of Spodek Law Group, and the firm's attorneys defend federal criminal and white collar matters nationwide. Reach the firm at 212-300-5196.