Corporate Crime 1-2-2006

2, January 2006                                 Corporate Crime 

White Collar criminals guilty of securities and accounting fraud are getting sweetheart deals from the Justice Department and escaping public exposure for their misdeeds. Under a policy implemented by the Justice Department in 2003, a large number of major corporations who have committed serious crimes have not been prosecuted or convicted. The watch-dog group, Corporate Crime Reporter, has named 34 major corporations that have been granted favorable settlements. Prosecutors forego criminal prosecutions in exchange for cooperation against executives, implementation of corporate monitors and fines. The report concludes that no major corporation guilty of accounting or securities fraud has been convicted since the Arthur Andersen conviction in June 2002. Instead, corporations are charged with a felony and are granted deferred prosecution agreements. These are agreements that were intended for juvenile delinquents, to clear the courts of minor issues.

A small sample of white collar corporate crimes: KPMG guilty of tax shelter fraud of $2.5 billion; Monsanto guilty bribing officials of the Indonesian Government to circumvent an environmental impact report;15 executives of HealthSouth escaped prosecution and instead were placed under ‘house detention’; Con Ed escaped prosecution for serious environmental infractions; Bristol-Myers Squibb guilty of major accounting fraud and Sears guilty selling defective tires, both escaped prosecution. Contrast these soft punishments with the harsh sentences of those guilty of street crimes speaks volumes of the prevailing dual justice system that exists in our society