Over the course of 21-year course history of Corporate Crime Reporter, we have interviewed scores of prosecutors and former prosecutors.
And one standard question we ask is – have politics ever entered into your decision-making process of whether or not to prosecute a corporate crime case or a public corruption case?
Percentage of prosecutors interviewed who have admitted to political interference?
Percentage of prosecutors who say – never happened?
One hundred percent.
We never believed these answers.
Life is too complicated for absolutes.
And yesterday on Capitol Hill, we got a peek at a separate reality.
Lo and behold, it turns out that politicians want to know.
And they pick up the phone and call the U.S. Attorney and ask – what’s up with that public corruption prosecution?
When’s it going to happen?
And it turns out that prosecutors prosecute for political benefit.
Got to get this prosecution done before the election.
And their political superiors try to stop those prosecutions – also for political benefit.
Carol Lam was the U.S. Attorney for San Diego.
Unlike most of her 92 fellow U.S. Attorneys, Lam decided that she was going to spend her scarce resources on prosecuting white collar and corporate crime.
She prosecuted public corruption in the city of San Diego.
She prosecuted corporate fraud in the health care industry.
And she sent to jail a powerful member of Congress – Randy Duke Cunningham (R-California) – for public corruption.
Under her tenure, street crime in San Diego also plummeted.
But according to her superiors, she ranked 91st our of 93 in gun violence prosecutions.
And she ranked low for immigration smuggling prosecutions.
She says she was bringing fewer cases – but cases with more bang for the buck.
The Justice Department’s response to Lam – you’re fired.
David Iglesias was the U.S. Attorney in New Mexico.
Iglesias was eyeing a public corruption prosecution of local Democratic Party officials.
One day, while at home, Iglesias gets a call from Senator Pete Domenici (R-New Mexico) – the man who gave Iglesias his job.
“He wanted to ask me about the corruption matters or cases widely reported in the local media,” Iglesias said. “‘Are these going to be filed before November?’ – he asked. I said I didn’t think so. ‘I’m very sorry to hear that’ – he said. The line went dead. He didn’t say goodbye.”
“I felt sick afterward,” Iglesias said. “I felt he was upset at hearing the answer he received. I felt leaned on, pressured to get these matters moving. It was unprecedented to get a call at home. It had never happened before.”
Iglesias said that the 2006 political race in New Mexico was very close – and the prosecution of Democrats for public corruption would have made a difference in the election.
Iglesias said that Congresswoman Heather Wilson (R-New Mexico) called him and said she had been hearing about “sealed indictments.”
“When she asked – ‘What can you tell me about sealed indictments?’ – red flags went up in my head,” Iglesias said. “We cannot talk about a sealed indictment. It’s like talking about launch codes at Sandia National Lab.”
“I said something about sealed indictments for national security cases,” Iglesias said. “She was not happy with that answer.”
The Justice Department’s response to Iglesias – you’re fired.
Thomas DiBiagio was the U.S. Attorney in Maryland.
He told the New York Times that he was forced out in early 2005 because of political pressure stemming from public corruption investigations involving associates of the state’s governor, Robert Ehrlich – a Republican.
“There was direct pressure not to pursue these investigations,” DiBiagio told the Times. “The practical impact was to intimidate my office and shut down the investigations.”
But William Moschella – an assistant deputy attorney general – told a House Judiciary Committee subcommittee that after the Times ran the article, he spoke with the Justice Department’s ethics official, David Margolis.
Moschella said that Margolis’ investigation of the situation found that “there were inappropriate e-mails and a staff meeting initiated by Mr. DiBiagio in which he specifically called for public corruption cases within a specific time frame indicating he wanted to bring some prior to the election.”
“This was so egregious that the Deputy Attorney General at the time – Jim Comey – had to write him a letter saying – you will not bring any public corruption cases without running it by me first,” Moschella said.
The Justice Department’s response to DiBiaggio – you’re fired.
The President can fire a U.S. Attorney for any reason or for no reason.
So, we’re not saying Lam, Iglesias, DiBiagio or any of the other U.S. Attorneys shouldn’t have been fired.
But don’t feed us a line of bull that corporate and white collar crime prosecution are non-political in nature.
It’s the political economy.
Copyright 2007 Corporate Crime Reporter