Greetings fans of Snarf's lawsplainers , all three of you! Recent events in the news have brought up some old, familiar memories- specifically, so-called “white collar” crime. This is also a recurring issue on these forums- from the nuTSR saga to other issues involving bad actors in the RPG space, we often see people wonder why outrageous conduct that can be prosecuted as a crime often isn't prosecuted as a crime. Usually, it's something involving corporate muckety-mucks screwin' the little people. But we often see threads here where people comment on various bad behavior, and say, "There's a law for that! They should go to jail," and then become surprised and shocked when the miscreant is neither charged, nor do they go to jail.
Well, white collar crimes (specifically, financial crimes) have always been hard to prosecute, and will only get harder. And it doesn’t just take some misguided Supreme Court decisions* to cause this- it’s endemic to our system of justice. So, let’s examine why!
*Although they really aren't helping. Yeah, we all know about the Nazgûl ... you aren't foolin' us with all of your, "Bribery really isn't bribery," cases.
1. Money Matters. This should be the most obvious point, yet it’s barely mentioned. Our legal system, especially on the criminal side, is more concerned with “procedural” issues than it is with, um, ultimate questions of innocence and guilt. That’s why you can have Justice Scalia, in Herrera v. Collins, 506 U.S. 390 (1993), state, “There is no basis in text, tradition, or even in contemporary practice (if that were enough), for finding in the Constitution a right to demand judicial consideration of newly discovered evidence of innocence brought forward after conviction.”
Harsh, bruh. Scalia was saying that irrefutable evidence of innocence discovered after a conviction ... doesn't require any judicial review. At all. But the point he was making is that in our system of criminal justice, theoretically, by guaranteeing procedural fairness (due process), the truth will emerge in an adversarial system. And procedural fairness is what the system is about- not "innocence."
Of course, if you have a lot of money, it is easier to either make the truth emerge, or to confuse the jury regarding the truth... and you can stuff any pesky truth-like substance in a deep, dark hole. Money allows you to pay for expert witnesses, for example, to testify about disputed issues. Money allows you to pay for your own investigators to ferret out information. And money allows you to buy not just the best attorney that money can buy, but the best TEAM of attorneys that money can buy. And it will ensure that this team of attorneys is fully dedicated to making sure you don’t spend a day in prison. Moreover, because of the many issues regarding procedural fairness, more attorneys means more motions, more motion practice, more issues related to discovery, and so on (money also allows for a well-heeled Defendant to get jury consultants, and same-day transcripts, and all sorts of things that give you small advantages). And if that rich person actually gets convicted, money lets them appeal, with great appellate attorneys, who will go over all the rulings in the trial to find any possible issue to appeal on. A rich Defendant can literally stop the wheels of justice from moving in many cases. Money isn't just a lubricant, it can be used to stuff the spokes of that creakity ol' justice wheel to keep it from turning. Which leads to ...
2. Prosecutors Like to Win. If you are familiar with the criminal justice system, you know about the use of plea bargains in the criminal justice system. So, for a typical “street-level” or, um, “blue collar” (aka, “poor”) criminal, they will often be able to get a plea bargain for their first few offenses (minimal jail or probation time), until they get hit with a certain offense ... and then they are toast. And part of the reason they are toast is, of course, because they have a record. And they have a record BECAUSE of the past plea bargains. On and on it goes. The system doesn't forget, and the system doesn't forgive.
But here’s the thing. Prosecutors, like everyone else, are human.* They want to win. And extracting onerous plea bargains and/or convicting someone with a prior record who is forced to use a public defender while you use the testimony of LEOs and various experts hired by the State (knowing that the defendant will not have the resources to hire their own experts) ... that’s an easy victory. On the other hand, financial crimes? Convicting someone with a team of well-paid attorneys who will contest everything and will obstruct all your attempts to gather evidence? That’s hard. And time-consuming. Even if you have an extremely good case, most prosecutors would be tempted to chalk up a "win" (agreed-to fine, agreement not to, um, steal all those millions from orphans and widows again) rather than deal with an uncertain criminal trial.
*Lizard people are, of course, the exception. I AM THE LIZARD KING! I CAN DO ANYTHING!
3. No One Told Me There Would Be Math. Most attorneys didn’t go to law school because they were really good at math; or, if they did, they went into patent law or tax law, not criminal law. The sad truth is that financial crimes suffer because no one is good at math. There are very very few people who are trained to investigate and ferret out these crimes. There are very very few attorneys who understand these crimes, and, for that matter, can explain these crimes to a jury. And, most importantly, there are very people on juries that understand these crimes. Confusion about math can often be parlayed into reasonable doubt. But it’s a constant winnowing effect- few investigators are trained to understand it (resources), few attorneys can prosecute it, and those that can know that it can be a hard sell to juries.
These same issues (lack of knowledge, lack of resources) are what plague computer crime investigations. Put it this way- if you are amazing at ferreting out financial crimes, you could probably make a lot more money in the private sector ...covering them up being a productive member of society that follows the rules!
4. Who is Responsible? In some cases, like Madoff, or Manafort, it is easy to allocate responsibility. Other cases are ... harder. For example, if you look back at the history of the Very Large Banks(tm) during the Great Recession, you saw a lot of ... well, (arguably) criminal activity taking place. And many of the VLBs were fined for this. But there is always the dilemma- do you go after the individuals who work at the businesses, who are often just cogs in the machine, or do you go after the company? And if you go after the company, what does that mean for all of the employees who had nothing to do with the wrongdoing, since a criminal prosecution by the government is the death-knell for most corporations (see Andersen, Arthur). Put another way, we don't prosecute companies very often, and if a company is doin' the crimes, they will usually just settle out with a very large fine. Or, as Wells Fargo likes to say, "Every few years we have to pay out a billion or so. Cost of doing business."
5. “That’s a civil matter.” One common refrain you will hear from prosecutors when it comes to white collar crime, especially with regards to financial crimes, is that it is a civil matter. And by this, they mean that “since it’s only money,” people can just bring their own lawsuits to be made whole. So you get the strange situation wherein if an employee steals $100 from the cash register, that’s something the police will get involved in, but if an executive steals $10 million dollars from the company, “that’s a civil matter.” Put another way, the police often won't even investigate a lot of financial crimes- they think it's just a business dispute.
6. "It's a victimless crime, and Stock Bro will never do it again!" The final issue I will point out is the nature of policing and justice. This issue has been known for a long time ... "The law, in its majestic equality, forbids rich and poor alike to sleep under bridges, to beg in the streets, and to steal their bread." -Abraham Lincoln (ahem).
The justice system is built from our society, and our society has certain frameworks. Part of that is people think that crimes that they can see (robbing a store, for example) have victims, but crimes that are "just numbers" (robbing a pension plan) are "victimless." Of course, that' not true- financial crimes do have victims, lots of them, and actions by people like Madoff leave a trail of broken people and suicides in their wake. But even knowing that, there is still that presumption that so many have. Then, if a person is convicted of a white collar crime, they will likely have no prior record, and have some kind of history of being "the right kind of person" that deserves a second chance. Read into that what you will.
There are numerous other factors that I am not addressing, but the dichotomy between "white collar" and other crime exists. In short, if you want to do crime in America, go BIG or go HOME.
As for the purpose of the post? Two reasons. First, most white collar prosecutions occur when there is enough public outrage over something to force the prosecution, or the acts are so egregious that they must be prosecuted. Second, this might serve as a helpful reminder that the next time we see an account of perfidious behavior in the RPG sphere involving a company doin' bad stuff.... remember, criminal prosecutions are the exception, not the rule.
Well, white collar crimes (specifically, financial crimes) have always been hard to prosecute, and will only get harder. And it doesn’t just take some misguided Supreme Court decisions* to cause this- it’s endemic to our system of justice. So, let’s examine why!
*Although they really aren't helping. Yeah, we all know about the Nazgûl ... you aren't foolin' us with all of your, "Bribery really isn't bribery," cases.
1. Money Matters. This should be the most obvious point, yet it’s barely mentioned. Our legal system, especially on the criminal side, is more concerned with “procedural” issues than it is with, um, ultimate questions of innocence and guilt. That’s why you can have Justice Scalia, in Herrera v. Collins, 506 U.S. 390 (1993), state, “There is no basis in text, tradition, or even in contemporary practice (if that were enough), for finding in the Constitution a right to demand judicial consideration of newly discovered evidence of innocence brought forward after conviction.”
Harsh, bruh. Scalia was saying that irrefutable evidence of innocence discovered after a conviction ... doesn't require any judicial review. At all. But the point he was making is that in our system of criminal justice, theoretically, by guaranteeing procedural fairness (due process), the truth will emerge in an adversarial system. And procedural fairness is what the system is about- not "innocence."
Of course, if you have a lot of money, it is easier to either make the truth emerge, or to confuse the jury regarding the truth... and you can stuff any pesky truth-like substance in a deep, dark hole. Money allows you to pay for expert witnesses, for example, to testify about disputed issues. Money allows you to pay for your own investigators to ferret out information. And money allows you to buy not just the best attorney that money can buy, but the best TEAM of attorneys that money can buy. And it will ensure that this team of attorneys is fully dedicated to making sure you don’t spend a day in prison. Moreover, because of the many issues regarding procedural fairness, more attorneys means more motions, more motion practice, more issues related to discovery, and so on (money also allows for a well-heeled Defendant to get jury consultants, and same-day transcripts, and all sorts of things that give you small advantages). And if that rich person actually gets convicted, money lets them appeal, with great appellate attorneys, who will go over all the rulings in the trial to find any possible issue to appeal on. A rich Defendant can literally stop the wheels of justice from moving in many cases. Money isn't just a lubricant, it can be used to stuff the spokes of that creakity ol' justice wheel to keep it from turning. Which leads to ...
2. Prosecutors Like to Win. If you are familiar with the criminal justice system, you know about the use of plea bargains in the criminal justice system. So, for a typical “street-level” or, um, “blue collar” (aka, “poor”) criminal, they will often be able to get a plea bargain for their first few offenses (minimal jail or probation time), until they get hit with a certain offense ... and then they are toast. And part of the reason they are toast is, of course, because they have a record. And they have a record BECAUSE of the past plea bargains. On and on it goes. The system doesn't forget, and the system doesn't forgive.
But here’s the thing. Prosecutors, like everyone else, are human.* They want to win. And extracting onerous plea bargains and/or convicting someone with a prior record who is forced to use a public defender while you use the testimony of LEOs and various experts hired by the State (knowing that the defendant will not have the resources to hire their own experts) ... that’s an easy victory. On the other hand, financial crimes? Convicting someone with a team of well-paid attorneys who will contest everything and will obstruct all your attempts to gather evidence? That’s hard. And time-consuming. Even if you have an extremely good case, most prosecutors would be tempted to chalk up a "win" (agreed-to fine, agreement not to, um, steal all those millions from orphans and widows again) rather than deal with an uncertain criminal trial.
*Lizard people are, of course, the exception. I AM THE LIZARD KING! I CAN DO ANYTHING!
3. No One Told Me There Would Be Math. Most attorneys didn’t go to law school because they were really good at math; or, if they did, they went into patent law or tax law, not criminal law. The sad truth is that financial crimes suffer because no one is good at math. There are very very few people who are trained to investigate and ferret out these crimes. There are very very few attorneys who understand these crimes, and, for that matter, can explain these crimes to a jury. And, most importantly, there are very people on juries that understand these crimes. Confusion about math can often be parlayed into reasonable doubt. But it’s a constant winnowing effect- few investigators are trained to understand it (resources), few attorneys can prosecute it, and those that can know that it can be a hard sell to juries.
These same issues (lack of knowledge, lack of resources) are what plague computer crime investigations. Put it this way- if you are amazing at ferreting out financial crimes, you could probably make a lot more money in the private sector ...
4. Who is Responsible? In some cases, like Madoff, or Manafort, it is easy to allocate responsibility. Other cases are ... harder. For example, if you look back at the history of the Very Large Banks(tm) during the Great Recession, you saw a lot of ... well, (arguably) criminal activity taking place. And many of the VLBs were fined for this. But there is always the dilemma- do you go after the individuals who work at the businesses, who are often just cogs in the machine, or do you go after the company? And if you go after the company, what does that mean for all of the employees who had nothing to do with the wrongdoing, since a criminal prosecution by the government is the death-knell for most corporations (see Andersen, Arthur). Put another way, we don't prosecute companies very often, and if a company is doin' the crimes, they will usually just settle out with a very large fine. Or, as Wells Fargo likes to say, "Every few years we have to pay out a billion or so. Cost of doing business."
5. “That’s a civil matter.” One common refrain you will hear from prosecutors when it comes to white collar crime, especially with regards to financial crimes, is that it is a civil matter. And by this, they mean that “since it’s only money,” people can just bring their own lawsuits to be made whole. So you get the strange situation wherein if an employee steals $100 from the cash register, that’s something the police will get involved in, but if an executive steals $10 million dollars from the company, “that’s a civil matter.” Put another way, the police often won't even investigate a lot of financial crimes- they think it's just a business dispute.
6. "It's a victimless crime, and Stock Bro will never do it again!" The final issue I will point out is the nature of policing and justice. This issue has been known for a long time ... "The law, in its majestic equality, forbids rich and poor alike to sleep under bridges, to beg in the streets, and to steal their bread." -Abraham Lincoln (ahem).
The justice system is built from our society, and our society has certain frameworks. Part of that is people think that crimes that they can see (robbing a store, for example) have victims, but crimes that are "just numbers" (robbing a pension plan) are "victimless." Of course, that' not true- financial crimes do have victims, lots of them, and actions by people like Madoff leave a trail of broken people and suicides in their wake. But even knowing that, there is still that presumption that so many have. Then, if a person is convicted of a white collar crime, they will likely have no prior record, and have some kind of history of being "the right kind of person" that deserves a second chance. Read into that what you will.
There are numerous other factors that I am not addressing, but the dichotomy between "white collar" and other crime exists. In short, if you want to do crime in America, go BIG or go HOME.
As for the purpose of the post? Two reasons. First, most white collar prosecutions occur when there is enough public outrage over something to force the prosecution, or the acts are so egregious that they must be prosecuted. Second, this might serve as a helpful reminder that the next time we see an account of perfidious behavior in the RPG sphere involving a company doin' bad stuff.... remember, criminal prosecutions are the exception, not the rule.
