Wednesday, March 12, 2008

Spitzer Quits -- Will Charges Follow?

Eliot Spitzer resigned as Governor of New York, issuing a statement (here) declaring that "I have begun to atone for my private failings with my wife, Silda, my children, and my entire family. The remorse I feel will always be with me."  The resignation came only two days after the public revelation of his philandering, and whether he will face any federal charges for his conduct remains to be seen.  As discussed in earlier posts (here and here), the U.S. Attorney's Office for the Southern District of New York could conceivably pursue potential violations of the Mann Act or the anti-structuring statute.  An interesting question is whether prosecutors might have sought Spitzer's resignation as a condition for not filing charges, or as part of an as-yet undisclosed plea agreement. 

Federal prosecutors seeking the resignation of an elected state official, or conditioning charges on such a decision, could raise significant federalism concerns.  Moreover, the political overtones of a Republican-selected U.S. Attorney seeking (or demanding) the resignation of a Democrat from elected office in an election year would only add to the concerns.  The U.S. Attorney's Manual in Sec. 9-16.110 addresses the issue of seeking the voluntary resignation of a non-federal elected official (here):

GENERAL RULE: Resignation from office, withdrawal from candidacy for elective office, and forbearance from seeking or holding future public offices, remain appropriate and desirable objectives in plea negotiations with public officials who are charged with federal offenses that focus on abuse of the office(s) involved. Where the office involved is not one within the Legislative or Judicial Branches of the federal government, such negotiated terms may be also be enforced involuntarily against the will of the defendant by a sentencing judge pursuant to the Federal Probation Act.

While not stated explicitly in the USAM, resignation does not seem to be an "appropriate or desirable objective" when the charges are unrelated to the official's exercise of authority.  To this point, Spitzer's tryst with the prostitute "Kristen" seems to be an entirely personal act, and the funds involved apparently came from personal accounts.  Thus, it would seem that the resignation should not connected to any charging decision, at least if the U.S. Attorney's Office acts in accordance with Department policy.  Should the use of government funds for the assignations have occurred, then Spitzer's resignation could be tied to a charging decision.  Of course, a decision to abjure filing charges is not subject to any outside scrutiny, so we would never know -- at least not officially -- whether his decision was in response to a request from the federal prosecutors.  (ph)

                                                                                                   

UPDATE: The U.S. Attorney's Office for the Southern District of New York issued a press release after Spitzer's resignation that states in its entirety: "In response to press speculation, MICHAEL J. GARCIA,the United States Attorney for the Southern District of New York,said: 'There is no agreement between this Office and GovernorEliot Spitzer, relating to his resignation or any other matter.' "  (ph)

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Investigations, Money Laundering, Prosecutions | Permalink

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Comments

Unless the federal prosectors can prove that Spitzer use public funds, taxpayer's money, or campaign funds to funnel money for his tryst, they have no case. It seem like this is personal act by Spitzer. And quite a bonehead mistake. Interesting timing of the expiration and renewal of wiretapping and Spitzer's sex sting.

Posted by: SP Biloxi | Mar 12, 2008 1:22:11 PM

Spitzer was doing business with organized crime for years. Remember people, this was not an intern, a girl he met on Craigs, or boy from an airport bathroom. Spitzer paid money on a regular basis to organized crime and violated a number of banking laws in addition to the Mann act. Spitzer was too smart to make a bonehead mistake, Spitzer had trust with this particular arm of a certain Organized Crime "Keiretsu". Dear Biloxi, read up on the RICO Act. Also, would you mind explaining why Eliot Spitzer refused to investigate the death threat recording delivered to his office against a whistleblower against hedge funds and colluding bankruptcy lawyers in the Worldcom Bankruptcy? Just Google "Spitzer Snoozes".

Posted by: David O. | Mar 12, 2008 8:17:30 PM

Dear David O:

I read on the RICO act. Also, I read thoroughly on the four defendants charged with the prostitution ring (55 pages). The issue of Spitzer, since he is revealed as Client 9, is whether he violated Mann Act, whether Spitzer used public funds, campaign funds, and so on for his tryst, and the timeframe of Spitzer alleged money tranferring into the Emperor Club. And if Spitzer was doing business with organized crimes as you said, then the money transfers and money laundering would be revealed. Otherwise, Spitzer, like any person accused, is innocent until proven guilty. And if you going to go after Sptizer in connection to money laundering, then all the rest of the clients and their money transfers must be exposed. Spitzer is guilty of having sex with prostitutes and betraying his family and the public in NY. My concern is where is the punishment of Senator Larry Craig and Senator David Vitter in their sex scandals?

Posted by: SP Biloxi | Mar 13, 2008 4:01:24 PM

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