Corporations have long sought to recoup costs incurred in responding to white-collar criminal conduct from individuals, such as former employees, who are subsequently convicted of federal crimes and subject to restitution at sentencing. But courts have been steadily narrowing the extent of such recovery, to the chagrin of cost-conscious in-house counsel and their insurance carriers, and to the relief of defendants already facing jail and other financial penalties.

A recent decision by the U.S. Court of Appeals for the Second Circuit, United States v. Afriyie, 27 F.4th 161 (2d Cir. 2022) continues that trend, holding that corporate victims may no longer seek restitution for costs associated with responding to SEC investigations, even though they frequently run closely parallel to many white-collar criminal matters.