- Florida court blocks drug-related seizure of house as violation of Constitution’s Excessive Fines Clause [Orlando Weekly, opinion in Agresta v. Maitland]
- Deferred- and non-prosecution agreements (DPAs/NPAs) have ushered in a little-scrutinized “shadow regulatory state” [Jim Copland and Isaac Gorodetski, “Without Law or Limits: The Continued Growth of the Shadow Regulatory State,” Manhattan Institute report]
- Politicized prosecution: New York Attorney General Eric Schneiderman throws book at bankers for not lending in Buffalo [Conrad Black via Tim Lynch, Cato]
- Would it improve prosecutors’ incentives if localities rather than state governments paid for incarceration? [Leon Neyfakh, Slate, via David Henderson]
- Andrew Pincus on the growing danger of enforcement slush funds [U.S. Chamber, more]
- “The Department of Justice, if it succeeds on its new theory, may have criminalized many instances of dull employee misconduct.” [Matt Kaiser, Above the Law; Peter Henning, N.Y. Times “DealBook”]
- A Brooklyn mess: new D.A. looking into 70 convictions obtained with evidence from retired detective Louis Scarcella [Radley Balko]
George Will on overcriminalization, mens rea, and regulatory crimes, typically clear and cogent. Second paragraph:
In 2007, professor Tim Wu of Columbia Law School recounted a game played by some prosecutors. One would name a famous person — “say, Mother Teresa or John Lennon” — and other prosecutors would try to imagine “a plausible crime for which to indict him or her,” usually a felony plucked from “the incredibly broad yet obscure crimes that populate the U.S. Code like a kind of jurisprudential minefield.” Did the person make “false pretenses on the high seas”? Is he guilty of “injuring a mailbag”?
Washington Post today launches an investigative series on dubious Shaken Baby Syndrome convictions. “In Illinois, a federal judge who recently freed a mother of two after nearly a decade in prison called Shaken Baby Syndrome ‘more an article of faith than a proposition of science.'” We’ve covered this developing story with many links in recent years.
Since Judge Thomas Goethals “began presiding over heated hearings probing the misuse of jailhouse informants, dozens of prosecutors have steered criminal cases away from his courtroom.” In the three years 2011-13, prosecutors made disqualification requests against Goethals six times, or an average of twice a year. “Since February 2014, the district attorney’s office has asked to disqualify Goethals — a former homicide prosecutor and defense attorney — in 57 cases, according to court records. … The surge of disqualifications began around the time the Superior Court judge agreed to allow wide-ranging hearings that brought prosecutors’ mishandling of informant-related evidence under harsh scrutiny.” California procedure allows both sides to exercise a single peremptory (unexplained) challenge to remove a judge they deem prejudiced against their interests. Some defense lawyers claim prosecutors are ganging up to discipline Goethals over rulings excoriating prosecutors for their handling of jailhouse-informant evidence. [Los Angeles Times]
“So why is Petraeus getting off with a misdemeanor and a probable probationary sentence? Two reasons: money and power.” [Popehat]
In Altoona, Pa., a private philanthropic group assisted by local businesses has funneled millions of dollars to local prosecutors to go after illegal drug cases [Pittsburgh Post-Gazette] Leaders of the group, called Operation Our Town, “said they don’t pressure prosecutors, and only publish the annual arrest and prosecution numbers as a way to raise funds.” Still, the practice sheds light on the changing status of privately assisted prosecutions, which were common in the Nineteenth Century but then came under an ethical cloud:
“It’s pretty much disappeared, in part because we want disinterested prosecutors who answer to the public, and not to individuals,” said Bruce A. Green, director of the Stein Center for Law and Ethics at Fordham University in New York.
Decisions by courts in California and Tennessee, among other places, have disapproved of private subsidies to prosecutors in cases where private parties had themselves been victimized by a crime or wanted to see more enforcement of obscenity laws. On the other hand, insurance and banking industry financial participation in efforts to investigate crimes like insurance fraud and bank robbery is widely accepted, although some trial lawyers have raised questions about insurers’ role.
In Key West, Fla., last year, nonprofit groups steered funds to underwrite a local prosecutor assigned to handle drunken driving cases. The arrangement died after defense attorney Jiulio Margalli sued, saying it violated state law.
“Do you want the motivation to be justice,” asked Mr. Margalli, “or do you want the motivation of the prosecutor to be a guilty verdict so that that [office] could continue to receive funding from the organization who paid them?”
“The Justice Department plans to try and force four major banks to plead guilty to criminal antitrust charges for alleged collusion by traders in foreign-currency markets, people familiar with the discussions said.” [WSJ]
And yes, that is gum with an “m” not gun with an “n.” [CNN]
In New York that’s getting to be a regular pattern in the settlement of charges against financial firms; although Eliot Spitzer, known for creative methods of corporate decapitation, may have departed office, Spitzerism lives on. I explain in a new Cato post on the state’s Ocwen Financial pact.
Related: Tactics the federal government used to seize control of insurer American International Group (AIG) away from Hank Greenberg, now made public despite years spent resisting disclosure [Gretchen Morgenson, New York Times]
I’ve got a new post up at Cato at Liberty about the Second Circuit’s sharply worded dismissal of two insider trading convictions, which alas came too late to avoid massive damage to the enterprises and people concerned. Quoting NYT “DealBook”:
The dismissal of the case also raises questions about the November 2010 raids of Level Global and Diamondback Capital Management by the Federal Bureau of Investigation. Soon after the raid on Level Global, the hedge fund, which was started by Mr. Chiasson and David Ganek, shut down, in part because of requests by investors to redeem their money after the raid. Mr. Ganek was never charged with any wrongdoing by federal authorities.
Diamondback, where Mr. Newman was a portfolio manager, continued to operate for another two years, but it decided to close its doors in December 2012 after receiving a wave of investor redemptions.
Mr. Ganek chided the government in a statement on Wednesday. “For the dozens of my high-integrity colleagues at Level Global who lost their jobs and their reputations because the F.B.I. improperly raided our firm in this now-discredited fishing expedition, today’s legal vindication is a reminder how prosecutorial recklessness has real impact on real people,” he said.
Raids, as opposed to subpoenas and other dull ways of obtaining information sought in an investigation, are irresistible to the press — and they greatly reinforce the public impression that there must have been serious wrongdoing at a target enterprise. That in turn can spell doom especially for financial undertakings, whose business will often be built on client and public trust. And if the case subsequently fails to stick by the evidence or the law, well, it’s on to the next prosecution, right?