Thursday, December 24, 2009
Albert Alschuler, Two Ways to Think About the Punishment of Corporations - here
Larry Ribstein, How Movies Created the Financial Crisis
Tuesday, December 15, 2009
Sunday, December 13, 2009
SEALS Call for Papers
Law Professors - The Southeastern Association of Law Schools (SEALS) has a call for papers -
CALL FOR PAPERS
A roundtable discussion will be held at SEALS 2010 on "Re-evaluating Corporate Criminal Liability."
Among the questions that deserve focus in this area are the following:
- Should we discard corporate criminal liability?
- Should we expand corporate criminal liability?
- Should we modify the ALI standard for corporate criminal liability?
- Can tort actions properly accommodate corporate misconduct?
- Is corporate regulation sufficient to handle corporate misconduct?
Participants will prepare a paper of approximately ten pages related to this topic, and the papers will be distributed prior to SEALS 2010. At SEALS, each of the participants will be given a few minutes to summarize their paper, which will be followed by a moderated discussion on the topic.
Two of the participants in this roundtable will be selected from a Call for Papers that will be reviewed by Professor Joan Heminway (Tennessee), Professor Andrew Taslitz (Howard), and Professor Ellen S. Podgor (Stetson).
Papers must be received by January 1st to be considered for this Roundtable. You are welcome to submit an abstract by this deadline, but papers are more likely to be given stronger consideration. Submit all papers to Ellen S. Podgor at email@example.com
Saturday, October 24, 2009
The University of Chicago's Legal Forum - 2009 Symposium on Crime, Criminal Law and the Recession -began with opening remarks from Anton Valukas(Jenner & Block), who many remember as the former United States Attorney from the Northern District of Illinois in the days of Greylord. Now appointed the Examiner in Lehman Brothers Holdings bankruptcy, he was speaking as the opening keynote on recession and crime. He reminded us of the history of downturns in the economy and how individuals "get caught" when the economy goes soar. He spoke also about the role of lawyers, accountants, and other gatekeepers.
The first panel was Brian Walsh from the Heritage Foundation and myself. Brian Walsh, in a well received talk, stressed how the tools to fight the criminality have been there and adding more to the federal criminal code is not the answer. My talk looked at accountability (the lack of it at the time), who people are blaming (not necessarily accurately), and what transparency will provide us with in the future. A concern, which will be a focus of my paper, is with the diminishing media and its potential impact on investigative reporting that brings to light criminality, oftentimes government corruption.
The second day proves to be a promising discussion with Stuart Green (Rutgers-Newark), John Pfaff (Fordham), Carol Streiker (Harvard), and Jordan Streiker (Texas) talking about the economics of punishment. Roger Fairfax (George Washington), Alex Kreit (Thomas Jefferson), Justin McCrary (Boalt), and Robert Mikos (Vanderbilt) will be speaking about state and local budgets - changes in police and prosecution. The final panel is Richard McAdams (Chicago) and Jonathan Simon(Boalt) speaking about social inequality and crime.
(esp)(written in Chicago)
Sunday, September 27, 2009
William A. Simpson, Corporate Criminal Intent - SSRN Abstract -
This paper is about the corporation as criminal defendant. In common-law legal systems a fully constituted criminal offence normally requires proof of both the proscribed action (actus reus) and criminal intent (mens rea). However, it appears highly artificial to describe corporate mens rea with ordinary language terms such as “knowledge,” “belief,” “desire,” or “intention.” After a review of common-law and philosophical approaches to imputing criminal intent to the corporate defendant, this paper proposes a behavioral approach to attributing mens rea to corporations and concludes with a review of the (UK) Corporate Manslaughter and Homicide Act 2007 which, it is submitted, adopts just such an approach.
Cindy A. Schipani, The Future of the Attorney-Client Privilege in Corporate Criminal Investigations - SSRN Abstract -
This manuscript discusses how the Department of Justice (DOJ) has viewed waiver of the attorney-client privilege as an important factor evidencing cooperation when determining whether to enter non-prosecution or deferred prosecution agreements with firms allegedly involved in criminal activities. It further discusses recent changes to the DOJ's guidelines, purporting to take waiver out of the equation in deciding whether to prosecute. Questions remain as to whether the corporate attorney-client privilege is a relic of the past or whether the new guidelines, issued in August, 2008, have indeed restored the privilege to firms under federal investigation.
Monday, September 14, 2009
Professor Peter Henning (Wayne State, visiting at Indiana U- Indianapolis) posted a new piece on SSRN titled, Should the SEC Spin Off the Enforcement Division -
The abstract describes it as:
The current environment is highly supportive of increased government regulation, particularly in the financial field. One of the beneficiaries of this push for greater oversight of the markets appears to be the Securities & Exchange Commission, despite some recent high profile enforcement failures, most particularly the massive Ponzi scheme undertaken by Bernie Madoff. In this essay, I raise the question whether the SEC should retain its enforcement authority over fraud cases, or whether it would be better served if that function were shifted to the Department of Justice. The SEC’s recent push to take on a more prosecutorial air gives the clear impression that an adversarial approach to enforcement of the securities laws is in order. However, the Commission must continue to solicit the views of Wall Street to fulfill its regulatory function, much like Madoff was included in the SEC’s deliberations on rules related to the stock market. At some point in the future, the push for greater regulation is likely to pass from the scene as the pendulum swings back toward a less intrusive approach to oversight. Whether the Commission can resist renewed entreaties to go easier on enforcing the law to free the capital markets from strict regulation is an open question. To allow the SEC to regulate Wall Street properly, splitting off at least a portion of the enforcement function to an agency with expertise in prosecutions - the United States Department of Justice - is at least worthy of consideration as the government looks to increase regulation.
Wednesday, September 2, 2009
Associate AG Perrelli states at the Pfizer Settlement Press Conference:
"today’s settlement reflects the Department of Justice working hard to protect American taxpayer dollars. This case is a great example of the Department’s commitment to fiscal accountability, combating fraud, and returning much-needed dollars back to the U.S. Treasury and state treasuries."
It is good to know that in these days of fiscal downturn, money is being obtained from a company that engaged in conduct disapproved by DOJ. (see here for background) But wouldn't it have been better if the wrongdoing had not occurred in the first place. I have to wonder what the government is doing pro-actively as opposed to re-actively to assure corporate compliance. Perhaps more dollars need to to be spent on "Educating Compliance" My forthcoming article, "Educating Compliance" to be published in Georgetown's American Criminal Law Review can be found here.
Tuesday, June 9, 2009
The United States Securities and Exchange Commission ("SEC") is hard at work remaking and re-energizing both its image and law enforcement role. It is also trying to ensure its survival as the premier agency overseeing the financial markets. It has assembled a new team at the helm, including a former federal prosecutor as head of the Enforcement Division and a new SEC Chairman, Mary Schapiro, who has committed herself to revitalizing the agency and has the Washington regulatory background to succeed. . .
Sunday, May 31, 2009
Saturday, March 21, 2009
Patricia E. Salkin has a book titled Ethical Standards in the Public Sector, Second Edition, a book published by the ABA.
Monday, March 9, 2009
Andrew George, Alexandra Walsh, and Bridget Moore, attorneys with Baker Botts LLP, authored a new article in 9 Criminal Litigation (2009) titled "Kimbrough, White Collar Sentencing, and the New Primacy of the Sentencing Commission." One point made in this article is that "in this new era of commission primacy, defendants may not make much headway focusing on sentencing factors available only to the wealthy, white collar offenders. Rather, they are probably better served by highlighting factors available to all - factors like age, health, lack of criminal history, commitment to family, or community service."
It is posted here - Download aba_crim_lit_article_cropped.pdf with permission and a thank you.
Sunday, November 2, 2008
Professor Miriam Baer of Brooklyn Law School has a new piece on SSRN that will be published in the Virginia Law Review. Titled, Linkage and the Deterrence of Corporate Fraud, she says that the Article "focuses on the difficulties of deterring perpetrators of fraud who are in the midst of their crimes, as opposd to potential perpetrators who are merely considering committing such crimes." She argues "that when law enforcement policies change (ie, harsher sanctions or promises of more stringent monitoring), mid-fraud perpetrators behave differently from potential perpetrators and, perversely, may perpetrate greater harm in response to traditional increases in sanctions and monitoring resources." She suggests policy changes. The Article can be found here.
Tuesday, October 28, 2008
- A new article on mail fraud by Jack D. Arseneault and Joshua C. Gillette from the New Jersey Lawyer Magazine. It is titled, Federal Honest Services Mail Fraud: The Defining Role of the States.
- Daniel C. Richman, Political Control of Federal Prosecutions - Looking Back and Looking Forward "explores the mechanisms of control over federal criminal enforcement activity that the Administration and Congress used or failed to use during George W. Bush's presidency."
- Mikah K. Thompson, To Speak or Not to Speak? Navigating the Treacherous Waters of Parallel Investigations Following the Amendment of Federal Rule of Evidence 408
Sunday, October 12, 2008
Wendy Gerwick Couture, White Collar Crime's Gray Area: The Anomaly of Criminalizing Conduct Not Civilly Actionable, available at SSRN here
Adam J. Kolber, The Comparative Nature of Punishment, available at SSRN here
Saturday, September 13, 2008
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.
Tuesday, September 9, 2008
Professor Daniel Sokol, University of Florida Levin College of Law, and blogger of the Lawprof Antitrust Law Blog, asked me to post the following:
Wednesday, September 3, 2008
Guest Blogger - Stephanie Martz - Senior Director, White Collar Crime Policy, National Association of Criminal Defense Lawyers (NACDL)
Professor Frank Bowman’s piece in The Legal Times ("Somebody Has to Cry Foul," August 18, 2008) is geared towards a singular thesis – that "the decline of civil regulation makes open-ended criminal statutes necessary." As a philosophical matter, I do not think that open-ended criminal statutes are ever a good idea. They fail to put American citizens on notice that certain behaviors – especially in the white collar area – are in fact against the law. We are supposed to be particularly concerned about this in the criminal, as opposed to civil or regulatory, context because of all of the consequences that are uniquely attendant to criminal prosecution, such as the deprivation of liberty and the lifelong deprivation of civil rights, the social stigma associated with conviction and incarceration, and the singular moral force and deterrent effect of the criminal law. This is why we have the "rule of lenity," in which ambiguous criminal statutes are supposed to be strictly construed by courts. As Justice Scalia wrote just this term in United States v. Santos:
Under a long line of cases, the tie must go to the defendant. The rule of lenity requires ambiguous criminal statutes to be interpreted in favor of the defendants subjected to them. This venerable rule not only vindicates the fundamental principle that no citizen should be held accountable for a violation of a statute whose commands are uncertain, or subjected to punishment that is not clearly prescribed.
How does this principle comport with Professor Bowman’s praise for "flexible" and "open-ended" criminal laws? It doesn’t, I’d venture. Let’s take honest services mail fraud as a prime example of a flexible and open-ended criminal law. This law prohibits schemes or artifices to defraud another of your "honest services" – basically, it criminalizes deceit. As numerous courts and commentators have observed, this could conceivably turn taking home a couple of reems of paper from your office into a federal felony. The statute has no built-in limits on how it can be used, and courts have struggled to come up with a coherent set of them. At base, it’s unconstitutional for Congress to permit "a standardless sweep [that] allows policemen, prosecutors, and juries to pursue their personal predlictions" (Smith v. Goguen, 415 U.S. 566, 574 (1974). Professor Bowman seems comfortable with the standardless sweep, as long as it’s in the name of filling in for absentee civil regulators.
Indeed, Professor Bowman seems willing to elide the fundamental point about the due process and notice requirements of criminal law for a hodgepodge of pragmatic reasons, which can all be filed under the rubric of ‘our last worst hope.’ (My words, not his.) "Ideally," he writes, "most of this sort of [mis]behavior would be deterred or dealt with by public and private civil regulatory mechanisms, but those mechanisms have conspicuously atrophied over the past several decades." He argues that "textual flexibility" and "broad prosecutorial discretion" are necessary because civil regulatory bodies "cannot keep pace with the rapid evolution of modern business and finance." 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. In fact, criminal prosecutors are far less likely to know the industry, the accounting rules, the compensation regimes, and all of the other details that make climbing the learning curve very difficult to do in each new case. He not-so-subtly accuses civil regulatory officials of capture—calling federal prosecutors "visitors from the normal world who apply ordinary understandings of right and wrong to what they find." But he declines to acknowledge that the flipside of capture is expertise, ability, and the institutional knowledge and perspective that help to ensure against overly aggressive (or overly lenient) enforcement decisions. The "commonsense judgments of prosecutors" that Professor Bowman extols are not, put simply, universally experienced by potential criminal defendants.
In order for us to engage in a more intelligent discussion of the pragmatic aspects of civil versus criminal enforcement of business crimes, it would be helpful if we were working with a complete and illustrative universe of enforcement statistics. While Professor Bowman refers to the frequently cited fact that white collar enforcement is slightly down these days, the Federal Justice Statistics Resource Center’s information shows that the number of federal mail, wire, securities, and related crimes that have been charged each year has remained fairly steady in the last ten years. (See this blog’s "White Collar Crime Prosecutions - A Long Way to Go to Hit the Levels of 5 Years Ago, May 14, 2008, referring to TRAC statistics on white collar crime enforcement.)
On a concluding note,I do think that his thesis should serve as a cautionary tale to those who would rail against the civil regulatory state: In the absence of civil enforcement, criminal enforcement will undoubtedly, unequivocally step into the breach. It’s a zero-sum game for American business.
Tuesday, July 22, 2008
Geraldine Szott Moohr ,Of Bad Apples and Bad Trees: Considering Fault-Based Criminal Liability for Complicit Corporations, 44 American Criminal Law Review, Vol 44, 2007 - available on SSRN here
Miriam Baer, Corporate Policing and Corporate Governance: What Can We Learn from Hewlett-Packard's Pre-testing Scandal?, University of Cincinnati Law Review - Corporate Law Symposium, 2008 - available on SSRN here
James B. Johnston, Prosecuting Government Fraud Despite the 'CSI Effect': Getting the Jury to Follow the Money, New England Law Review, Vol. 41, 2007 - available on SSRN here
Paul Rothstein, 'Anything You Say May Be Used Against You': A Proposed Seminar ton the Lawyer's Duty to Warn of Confidentiality's Limits in Today's Post-Enron World, Fordham Law Review, Vol. 76, 2007 - available on SSRN here
Sunday, June 29, 2008
Plea Bargaining's Survival: Financial Crimes Plea Bargaining, a Continued Triumph in a Post-Enron World
LUCIAN E. DERVAN
Oklahoma Law Review, Vol. 60, No. 3, Fall 2007
This article examines the war on financial crimes that began after the collapse of Enron in 2001. Although many believed that the reforms implemented following this scandal led to greater prosecutorial focus on financial crimes and longer prison sentences, an analysis of data from 1995 through 2006 reveals that little has actually changed. The statistics demonstrate that the government's focus on financial crimes has not increased and prison sentences for fraud have remained stagnant. How could this be the case? It is this author's hypothesis that although prosecutors could have chosen to use new statutes and amendments to the United States Sentencing Guidelines passed in the wake of Enron to increase prosecutions and sentences, they did not. Instead, prosecutors are using their new tools to encourage defendants to accept plea agreements that include sentences similar to those offered before 2001, while simultaneously threatening to use these same powers to secure astounding sentences if defendants force a trial. The result is that the promises of post-Enron reforms aimed at financial criminals were hollow and served only to reinforce plea bargaining's triumph.
|From Boardroom to Courtroom to Newsroom: The Media and the Corporate Governance Scandals|
KATHLEEN F. BRICKEY
Washington University School of Law
Journal of Corporation Law, Vol. 33, p. 625, 2008
Washington U. School of Law Working Paper No. 08-05-01
(esp) (posting from Denver, Colorado)
(esp) (posting from Denver, Colorado)