Considering White Collar Crime Sentences

Blog co-editor Ellen Podgor published an interesting article in the Yale Law Journal Pocket Part about the current nature of white collar crime sentences, "Throw Away the Key."  She discusses the recent phenomenon of lengthy sentence for white collar defendants who are almost always first-time offenders posing no threat to society.  She argues:

No doubt many of these white-collar offenders committed thefts within companies, and in some cases decimated employees’ and investors’ savings. But the sentencing Guidelines limit courts’ abilities to consider factors such as the motive of the perpetrator, the benefit he or she received, and the extenuating circumstances that caused the harm. Instead, the judge may only consider the sentencing Guidelines’ mathematical computation of loss when imposing a sentence. As a result, in some courts the person who steals to benefit the company without personal remuneration can receive a comparable sentence to the rogue employee who cashes in his or her company stock to obtain an immediate personal profit. The accused becomes irrelevant in a sentencing world ruled by the cold mathematical calculations found in the sentencing Guidelines. Not even the Supreme Court’s decision in United States v. Booker, which grants trial judges some flexibility after using the Guidelines, provides much relief. The statistics show that judges usually stick to the sentences provided in the Guideline grid.

A response to Professor Podgor's article was written by Andrew Weissmann and Joshua Block from the Jenner & Block firm -- Weissmann was head of the Enron Task Force before leaving for private practice.  Their article, "White-Collar Defendants and White-Collar Crimes," agrees with her point that long sentences for white collar defendants do not provide much deterrence, but disagree with the argument that such defendants should be viewed differently.  They argue:

Most troubling are Podgor’s arguments with respect to white-collar criminals. It is one thing to say that certain criminal acts are not as bad as others. But it is quite another to argue that people who commit white-collar crimes as a generalized group should be punished differently from those who commit other crimes. Any such differences often correlate in fact to race and almost always to class. One of the laudatory goals in promulgating the Sentencing Guidelines was to remedy the potential for hidden—or unhidden—bias in favor of “white collar” defendants.

The discussion is especially pertinent because the pace of white collar crime prosecutions continues.  Lord Conrad Black faces securities fraud, conspiracy and RICO charges in Chicago over transactions at Hollinger International when he was CEO, and former Qwest CEO Joseph Nacchio will go on trial in Denver on insider trading charges for selling over $100 million in shares shortly before the company's stock price collapsed due in part to accounting problems.  Like CEOs before them, these men face substantial sentences, which could amount to a virtual life term, for conduct that involved rather mundane corporate transactions. (ph)