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The New York Times
Opinion
Going Soft on
Corporate Crime
EDITORIAL,
nytimes.com on the Web, April 10, 2008
The Bush administration 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 example of how this administration has taken the
justice out of the Justice Department.
Eric Lichtblau reported in The Times on Wednesday that during the last three
years, the department has put off prosecuting more than 50 corporations on
charges ranging from bribery to fraud. Instead, it has been entering into
so-called deferred prosecution agreements and nonprosecution agreements, in
which companies are allowed to pay fines and hire monitors to watch over them.
Defenders say these deals save the government time and the expense of going to
trial and avoid doing unnecessary harm to corporations and their employees.
The cost to the public and the rule of law is too high.
If corporations believe that 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. Congress has been investigating the
decision by Christopher J. Christie, the United States attorney for New Jersey,
to award John Ashcroft, the former attorney general, a multimillion-dollar
contract to monitor a medical supply company accused of fraud. He also
gave a valuable contract to another former official, Debra Wong Yang.
Now that the F.B.I. is investigating mortgage lenders in the subprime scandal,
the issue of deferred prosecution agreements takes on even more urgency.
If any of these lenders have committed fraud, the Justice Department must
prosecute them vigilantly. What it should not do is work out another cozy
deal and hand another rich monitoring contract to a political friend.
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