WASHINGTON (AP) -- In a new strategy against crooked corporations, the Justice Department is allowing them to avoid prosecution in exchange for information about discussions between employees and company lawyers.

The disclosure of communications that typically are confidential gives companies the chance to escape with fines and the promise of internal changes. At the same time, prosecutors gain valuable information in pursuing criminal cases against executives who may have been responsible for inflated revenues and other corporate misdeeds.

Defense lawyers, however, say the tactic compromises the rights of individual defendants.

The cooperation helps companies avoid what Justice officials call "collateral damage" in corporate fraud cases -- the loss of jobs, investments and pensions -- that can accompany the filing of criminal charges.

The change in tactics is motivated in part by the government's experience in Arthur Andersen case. Some 28,000 people lost their jobs after the accounting firm was convicted in 2002 of destroying documents in the Enron scandal.

In a largely symbolic victory for the all-but-dissolved Andersen, the Supreme Court on May 31 overturned the verdict, ruling the jury had not been properly instructed.

"We seek to strike a balance between the need to go after the bad guys and yet not swing and knock down 10,000 innocent people," said Deputy Attorney General James Comey, who directs the agency's corporate fraud task force.

But in pressuring the companies to waive the attorney-client privilege, the government is taking away the rights of individual defendants, criminal defense lawyers say.

"What it does is creates an environment within a company where nobody can feel comfortable seeking legal advice from a lawyer because you can't have any assurance sometime down the road that the company isn't going to waive the attorney-client privilege," said David Zornow, a former federal prosecutor.

He now is representing Stephen Richards, a former executive at Computer Associates International Inc. of Islandia, N.Y., who stands accused of securities fraud and obstruction of justice.

The government decided to put off prosecuting the company, which makes software and storage systems for large businesses, and focused instead on company leaders such as Richards.

Computer Associates agreed in September to pay $225 million to stave off criminal charges in a multibillion-dollar securities fraud. The company employs more than 15,000 people.

In the past year, the government also has deferred corporate fraud prosecutions of AOL and American International Group, and criminal charges against Monsanto Co. and InVision Technologies Inc. in cases that involve alleged bribes of foreign officials.

Top Justice Department officials embraced the idea of deferred prosecutions several months after Andersen's conviction.

A January 2003 memo from then-Deputy Attorney General Larry Thompson to U.S. attorneys signaled the change. The memo said pretrial agreements of the sort previously used in criminal cases against individuals could be applied to corporations.

There have been no high-profile corporate prosecutions since.

But there has been a number of settlements that generally include a fine and other payments that often reach into the hundreds of millions of dollars. Companies generally promise to make changes and cooperate with the government.

If the company fails to live up to the terms of the deal, the government can pursue criminal charges.

The strategy also is a way for the government to get around constitutional protections against self-incrimination, said Zornow, a partner in the New York office of Skadden, Arps, Slate, Meagher and Flom.

He said an employee is unlikely to refuse a company's request to talk with its lawyers.

"Anything that individual says to the lawyers can be turned over to the government in a deferred prosecution agreement," Zornow said. "If the government had asked to speak to that person directly, that person would have engaged a lawyer and would have considered whether to assert a Fifth Amendment privilege" -- the constitutional right not to divulge self-incriminating information.

That view does not generate much sympathy in the wake of accounting scandals at Enron, WorldCom and other high-profile companies.

"Is that too high a price to pay? Isn't focusing on the individuals the right way to attack the problem?" said Jeff Gordon, a securities law specialist at Columbia University.

The government's offer to escape criminal charges and all the upheaval that can result from a prosecution can be attractive to corporate directors.

In the hands of overly aggressive prosecutors, that enticement could be abused, Gordon said. "But on balance, the deferred prosecution approach is better than some of the alternatives," he said.