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Are there two justice systems in America?

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Are there two justice systems in America, one for the executives of large corporations and another for the rest of us? Senator Elizabeth Warren, D-Mass., thinks so. She published a report on the subject last month, “Rigged Justice: How Weak Enforcement Lets Corporate Offenders Off Easy.”

Warrens maintains that “corporate criminals routinely escape meaningful prosecution for their misconduct.”  Rather than pursuing convictions of corporate executives, federal agencies agree to criminal and civil settlements that rarely require any admission of wrongdoing and allow executives go free without any individual accountability.

Warren cites plenty of examples. Standard & Poor agreed in February 2015 to pay a $1.375 billion civil in response to fraud allegations. The federal government alleged S&P had defrauded investors by issuing inflated ratings that misrepresented the true risks of residential mortgage-backed securities and collateralized debt obligations, a significant factor in the 2008 financial crisis. S&P was not required to admit to breaking the law, and no individuals were prosecuted.

Last August, two Citigroup affiliates agreed to pay nearly $180 million to the Securities and Exchange Commission to settle allegations they defrauded investors by selling risky, highly leveraged bonds to investors from 2002 to 2008 with false assurances the bonds were safe and low-risk. Investors lost an estimated $2 billion. Citigroup was not required to admit to any wrongdoing, and no individuals were prosecuted.

Last September, General Motors paid a $900 million fine after covering up an ignition switch problem that had resulted in at least 124 deaths and 275 injuries.  The fine represented less than one percent of the company’s annual revenue.  No one was subjected to criminal prosecution.

No one faced criminal prosecution for the 2010 Gulf of Mexico Deepwater Horizon oil spill, characterized by Attorney General Loretta as “the worst environmental disaster in American history.”  Last October, BP agreed to pay a $20.8 billion fine over 18 years in a settlement, but BP is allowed to deduct $15 billion of the payments from its income for tax purposes, reducing the impact of the civil penalty by over $5 billion.

Warren offers little explanation for why the federal government is lax on prosecuting corporate crime, except to say, “Lax enforcement . . . stems primarily from a lack of important legal tools and persistent underfunding by Congress that often turn the legal rules into little more than suggestions that companies can freely ignore.”

How is it that we don’t put white collar criminals in jail? It’s not that we don’t know how to incarcerate people. We’re actually very good at it. American penal facilities hold over 2.2 million people. The “World Prison Population List,” published by the International Centre for Prison Studies in October 2013, places the U.S. with the highest incarceration rate in the world: 716 inmates per 100,000 people.  That beats Cuba (510), Russia (475), El Salvador (422) and Thailand (398).

Apparently, we are zealous about putting “criminals” behind bars, but people who wear suits—not so much.

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Jack D’Aurora writes for considerthisbyjd.com  

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Discussion

  1. Eric Brown  February 21, 2016

    In a word, YES. It’s wrong, and there are too few of us willing to stand up and work for change. For justice.

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  2. Charles Rodenfels  February 22, 2016

    Where does Hillary Clinton “fit” into this view of thinking? To date she seems to get a pass?

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  3. David H  February 22, 2016

    Ok, lets see if I understand. Let’s take the GM problem. I guess one guy did the hiding, or maybe a group within some department. So maybe it’s 10 guys. Or we’ll go for the whole enchilada and go after 50,000 employees. Each trial providing full and ample protections for the accused so the jury will have to find guilt beyond a shadow of the doubt.

    How much judicial and government resources would be needed to successfully prosecute each and every one of the accused perps? How long would that take? Oh, maybe it doesn’t mater. Justice must be served…your opinion of justice, not everyone’s. The sure winner? The attorneys. There can be no debate about that. Lots and lots of fees and the court system would be wonderfully set up for these trials for years, maybe decades.

    But maybe that’s not the point. Someone was wrong. Someone clearly was to blame and may very well have broken a law (however in both the GM case and the BP case, that is clearly not clear). How many times do the authorities (I guess in your first justice system) defer or ignore prosecution in favor of cooperation? Or let a law breaker go because it’s too much trouble to prosecute due to the perceived nature of the offense?

    We have a system that removes hardened criminals from California prisons because they’re “over crowded” or the guilty person was a simple drug user, not a major dealer, etc., etc., and shouldn’t be in jail.

    Maybe your best example will be the Volkswagen fiasco. Surely someone should go to a deep dark jail for a very long time. We know that won’t happen, there are too many individuals to blame and those thousands cannot be sent to jail. What is the penalty? The company will be fined billions, investors are and will continue to bristle and there exists the possibility of a total company collapse.

    Sure, if they survive, which they probably will, in ten years no one will remember and they’ll be selling millions of vehicles. Same holds true for the bozo that robs a bank and “mistakenly” kills a teller. In ten or fifteen years, he’s out and no one cares or remembers, except for the dead person’s family.

    A second justice system that needs attention? Bullshit! Fix the first. The second one, if there is such a thing, is hitting big world corporations hard and is working quite effectively.

    But that’s just my opinion.

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  4. Matt Schaeffer  February 23, 2016

    First, I absolutely agree with Mr. Rodenfels, and I look forward to see how that plays out. Second, though I do not know the facts on any particular cases cited by Jack, I agree with his larger point: equal justice under the law. Because of the situations cited by Jack (and so many others), there is at least the appearance that government serves moneyed interests to the detriment of all others. Ordinary people on the left and the right are both fed up with it, so hopefully we will all do something about it.

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  5. miriam rafferty  February 24, 2016

    Absolutely justice should be served. Money and power prevails including the Clintons.

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