Tuesday, April 15, 2008

(In)Justice Department at Work--2

"A few years earlier, in the age of Enron, these kinds of charges would probably have resulted in a criminal indictment. Instead, Monsanto was allowed to pay $1 million and avoid criminal prosecution by entering into a monitoring agreement with the Justice Department. In a major policy shift, the Justice Department, once known for taking down giant corporations, including the accounting firm Arthur Andersen, has put off prosecuting more than 50 companies suspected of wrongdoing over the last three years. ... In many cases, the name of the monitor and the details of the agreement are kept secret. ... Firms have readily agreed to to the deferred prosecutions, said Vikramaditya S. Khanna, a law professor at the University of Michigan who has studied their use, because 'clearly it avoids a bigger headache for them.' Some lawyers suggest that companies may be willing to take more risks because they know that, if they are caught, the chances of getting a deferred prosecution are good. 'Some companies may bear the risk' of legally questionable business practices if they believe they can cut a deal to defer their prosecution indefinitely, Mr. Khanna said. Legal experts say the tactic may have sent the wrong signal to corporations--the promise, in effect, of a get-out-of-jail-free card. ... Defenders of deferred prosecution agreements say that they have been too harshly criticized lately and that they play a crucial role in allowing the government to secure the cooperation of a company while avoiding the time, expense and uncertainty of a trial. ... At a Congressional hearing last month, Mr. Ashcroft defended the agreements, saying that they have avoided 'destroying entire corporations' through criminal indictments. ... Paul J. McNulty, a former deputy attorney general who put the new guidelines in place in 2006 for corporate investigations at the [DOJ], said in an interview, 'There's a fundamental misapprehension with D.P.A.'s to think that they're a break for the company.' ... Charles Intriago, a former federal prosecutor in Miami, who specializes in money-laundering issues, said that huge penalties, like the $65 million fine for American Express Bank International in 2007, were 'peanuts' compared with the damage posed by a criminal conviction. ... The agreements were once rare, but their use has skyrocketed in the current administration. ... In general, such agreements result in companies acknowledging wrongdoing by not contesting criminal charges, but without formally admitting guilt. Most agreements end after two or three years with the charges permanently dismissed", my emphasis, Eric Lichtblau (EL) at http://www.nytimes.com/, 9 April 2008.

"The Bush adminstration has a well-known aversion to regulating big business. As it turns out, it is also reluctant to prosecute corporations that break the law. Federal prosecutors have been regularly offering settlements to companies for wrongdoing that, in previous administrations, would likely have led to criminal charges. It is another disturbing element of how this adminstration has taken the justice out of the Justice Department. ... If corporations believe they can negotiate their way out of a prosecution, the deterrent effect of the criminal law will inevitably be weakened. The deals also leave a clear impression that an administration that prides itself on being pro-law-and-order--and on appointing federal judges who are tough on ordinary criminals--is tilting the justice system in favor of the wealthy and powerful. There also are worrying signs that some prosecutors may be using these agreements for political patronage", Editorial at http://www.nytimes.com/, 10 April 2008.

No, the signal was intended. "A man is presumed to intend the natural and probable consequences of his acts", sayeth the Supremes. Even (In)Justice Department employees! "Allowing the government"? Are corporations sovereigns with armies to protect them from Uncle Sam? What's going on here? Isn't this nice? The Bush administration is more concerned about not destroying corporations than with incarcerating peons for decades over minor drug offenses. Artificial entities are more important than people to Bush & Co. "Fundamental misapprehension"? Please McNulty, stop insulting everyone's intelligence. That's exactly what they are. If they were anything else, the corporations in question would not agree to them! I agree with Intriago, $65 million is peanuts to Amex. Look at what's going on with BP and its proposed $50 million fine. Similarly, peanuts. Amen, EL. The current DOJ is so bad, you can almost want to see Hillary as our next President.

The Bush DOJ goes easy on "Extraordinary" as opposed to "ordinary" criminals. Makes sense.

No comments: