Saturday, September 13, 2008

Professor Frank Bowman Responds

Guest Blogger - Professor Frank Bowman - University of Missouri School of Law:

I enjoyed reading Ms. Martz's response to my American Lawyer/Legal Times article.  It's always a relief to find that somebody reads one's stuff, and a real pleasure when it draws an intelligent response.  A couple of thoughts on that response:

First, Ms. Martz opines that, "As a philosophical matter, I do not think that open-ended criminal statutes are ever a good idea."  I find it hard to believe that she really thinks this, at least in the absolute terms she uses.  Virtually all criminal statutes are open-ended to some degree, in the sense that their reach will be unclear at the margins.  That's one reason we have appellate courts -- to settle inevitable questions about the reach of statutory language.  More importantly to the present discussion, Anglo-American criminal law long ago gave up the struggle to define in advance the precise types of financial skullduggery it would deem criminal.  The history of the development of the old common law of larceny, and the later statutory offenses of embezzlement, false pretenses, and fraud is a centuries-long movement away from the particular to the open-ended in recognition of the law's inability to anticipate the forms criminal ingenuity might take.  So, unless Ms. Martz is advocating rolling back American law to about 1799 (when the first English embezzlement statute was enacted), what we are talking about is matters of degree.  And I agree that some modern federal statutes are too vague and would benefit from careful re-thinking.  But the suggestion that the entire body of federal criminal statutes regarding fraud and corruption can or should be changed so that it is no longer "open-ended" is not a serious proposition.

Second, Ms. Martz suggests, in common with many other critics of more aggressive federal white collar crime prosecution, that federal criminal prosecutions using open-ended statutes violate standards of notice and due process.  In plain English, she is saying that people are routinely being prosecuted for conduct they are shocked, shocked to find was illegal.  Now I won't say that such an event has never happened or that better-drafted federal statutes couldn't reduce the risk of such an event.  But it is surpassingly rare.  Federal law, as badly drafted as some parts of it are, basically says, "Don't lie, cheat, or steal in connection with certain business or government activities."   Ms. Martz's argument, at bottom, is that it is unfair to punish businessmen and government officials for lying, cheating, and stealing unless a statute tells them, with precision, in advance, exactly which forms and methods of lying, cheating, and stealing are prohibited.  She and I simply disagree.  I think the general prohibition is sufficient to provide notice.  In nearly thirty years of practicing and teaching criminal law, I have rarely if ever  encountered  a white-collar defendant who did the conduct with which he was charged but did not recognize (even if only privately) its intrinsic wrongfulness - even if he vigorously denied its criminality.

And if the uncertain boundaries of federal criminal prohibitions against dishonest business or government behavior cause some to hesitate before engaging in doubtful conduct, so much the better.   An economist might argue that this uncertainty may well discourage morally ambiguous, but economically beneficial or socially desirable, behavior.  Which will sometimes be true, but that is where public and private regulation of business behavior enters the picture, drawing the nuanced lines that the criminal law cannot and modifying behavior with sanctions less terrible than those of the criminal law.

Ms. Martz seems to miss my point about regulators when she remarks, "Professor Bowman makes no case, however, for why prosecutors are any better at sussing out complicated and often highly technical misconduct than the expert regulators."  First, my main point was not that prosecutors understand particular businesses or industries better than the "expert regulators" in the field, but that, for years past, regulators have been actively discouraged from either making regulations or enforcing them.  It is precisely because the "experts" have been handcuffed that the criminal law generalists have moved in.  Give some real power back to the experts and the heavy hand of the criminal law can relent.  Second, if by "sussing out" she means investigating and discovering facts, then she badly misread my article.  As I argued there, even in a world with a more active set of public and private regulators, there are some situations and institutions that only the Justice Department can confront.  Dismiss the point as merely "pragmatic" if you will, but when big, rich, politically well-connected corporations or industries go seriously astray or corruption becomes entrenched in state or local government, the Justice Department will often be the only institution with the power and incentive to find the facts and make common sense judgments about whether the facts amount to a crime.

Ms. Martz concludes:  "In the absence of civil enforcement, criminal enforcement will undoubtedly, unequivocally step into the breach. It's a zero-sum game for American business."  I could not disagree more with her characterization of the situation as a zero-sum game for business.    It is precisely this attitude - that both active prosecution of business crime AND reasonable civil regulation of business behavior are bad - that has put us where we are today.  A sensibly reinvigorated regulatory environment would not only diminish the need for criminal intervention in business affairs, but would improve both the political and economic health of the country.

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Comments

This debate appears to pit the classic academic theory, espoused by Professor Bowman against the practical approach of the practitioner, espoused by Ms. Martz. It seems that there should be a point where theory and practice would find a happy medium. Unfortunately those who must referee that happy medium are really not appellate judges, but are folks who are required to run for re-election every two or six years subject to the viccisitudes of an electorate that cares about neither the pratical nor the theoretical cononundrum but tends to support harsh criminal enforcement and very little civil regulation.

To suggest that today's financial crimes statutes are somehow the result of a long culmination of the common law of larceny, seems, to me, to be hyperbole. Although exacting precision is not achievable, any criminal statute should define, as closely as possible, the elements upon which any defendant's liberty rests. That's just basic fairness.

Posted by: Mike Iacopino | Sep 14, 2008 7:45:43 AM

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