DOJ Enforcement to Trend Even More Towards White Collar?

by Moore & Van Allen PLLC
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Moore & Van Allen Litigation Member Scott Schools is serving as a Law.com contributing author.  Schools' article below initially published on Law.com on July 11.

On April 29, 2009, just weeks after being sworn in as the Assistant Attorney General for the Department of Justice’s Criminal Division, Lanny Breuer testified before Congress that “[t]he Administration believes Congress’s goal should be to completely eliminate the sentencing disparity between crack cocaine and powder cocaine.”1  This testimony was significant to Department prosecutors at the time in part because in courtrooms across the country they were obligated to advocate for sentences that reflected current law at the same time defense counsel argued, based on Mr. Breuer’s testimony, that even the Department’s highest level officials thought that existing law was unfair.  What was perhaps less obviously significant from Mr. Breuer’s testimony was that it represented the beginning of a shift in enforcement priorities for the Department.

Multiple factors underlie the shift.  The current administration entered duty in 2009 on the heels of the financial crisis that was perceived as the crime problem du jour, no less than violence and addiction associated with the crack cocaine epidemic of the 1980s was the crime problem of that jour.  Although crack cocaine use and distribution had not disappeared entirely in 2009,2 the national violent crime rate had dropped precipitously.  The FBI’s 2012 Annual Report on Crime in the United States shows, by way of example, that the rate of violent crime per 100,000 citizens dropped from 747.1 in 1993 to 431.9 in 2009, or a 42.2 percent decrease—a trend that has continued since.3  The administration’s view on marijuana enforcement has likewise evolved over time as reflected in memoranda issued in 2009, 2011, and 2013, the latter of which—issued after the legalization referenda in Colorado and Washington—exhibited a decidedly more deferential view toward state marijuana laws.  Then, in August 2013, the Attorney General announced his Smart on Crime Initiative that provides inter alia for less frequent filing of drug-related charges that carry mandatory minimum sentences including less frequent filing of prior conviction sentencing enhancements.  In short, the Department has at virtually every turn de-emphasized narcotics enforcement.

Although the narcotics policies are consistent with the Attorney General’s enforcement priorities, budgetary issues also influenced the Department’s enforcement agenda.  One quarter of the Department’s budget represents spending on federal prisons that are thirty percent over occupied,4 and imposition of lengthy sentences in narcotics cases has driven those numbers.  As of September 30, 2012, 51.4 percent of federal inmates had been convicted of narcotics offenses.5 This fact combined with the budget realities borne of the financial crisis and exacerbated by the sequester has also led the Department to emphasize federal interest as a primary driver of federal prosecutorial charging decisions.  In fact, the Attorney General issued a memorandum on enforcement priorities contemporaneous with his Smart on Crime announcement.  The listed priorities are identical to those he announced in a speech to Department employees in April 2011, to wit, “(1) protecting Americans from national security threats; (2) protecting Americans from violent crime; (3) protecting Americans from financial fraud; and (4) protecting the most vulnerable members of our society.”However, the Smart on Crime priorities memorandum announces a change in the charging decision calculus.  The priorities memorandum notes that the Principles of Federal Prosecution provide that federal charges should be initiated only when “prosecutors . . . determine not only that [an individual’s] conduct constitutes a federal offense and admissible evidence is sufficient to obtain and sustain a conviction, but also that the prosecution serves a substantial federal interest, the person is not subject to effective prosecution elsewhere, and there is no adequate non-criminal alternative to prosecution.”7  However, signifying renewed emphasis on federal interest, the memorandum declares that “it is of primary importance to assess whether the prosecution serves a substantial federal interest.”8 This emphasis should result in a reduction in the number of cases filed because it would cause prosecutors to refrain from filing cases that do not clearly further federal enforcement objectives – in other words, cases that can be prosecuted effectively in local courts.

Whether the 2013 Smart on Crime initiative will have a meaningful impact on charging decisions within the United States Attorneys’ Offices, which always must seek to balance local law enforcement needs with Washington-based priorities, remains to be seen.  Examination of the United States Attorneys statistical reports from 2009 and 2013 suggests a shift in emphasis up to this point, but not a radical one.  The 2013 report shows that the number of cases filed dropped 9.3 percent from 2009 to 2013.  Whether that reduction is a result of resource constraints or emphasis on more complex prosecutions is not clear.  The 2009 and 2013 statistical reports reflect that narcotics offenses constituted 22.6 percent of cases filed in 2009 and 21.8 percent of cases filed in 2013.  White collar offenses and official corruption made up 9.5 percent of cases filed in 2009 and 11 percent in 2013.  As is often stated in the halls of Justice, the Department is like a steam ship, not a race car—when it turns it turns slowly.  Nonetheless, it does appear that it may be turning.  The Attorney General’s public pronouncements of his intention to continue to focus on financial crisis crimes,his continued emphasis on protecting Americans from financial fraud as a Department priority, and his 2013 memorandum emphasizing the importance of federal interest in charging decisions portend  that charging decisions will trend even more towards white collar prosecutions in the future.  Time will tell.

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[1] Restoring Fairness to Federal Sentencing: Addressing the Crack-Powder Disparity, Hearing Before the Subcomm. on Crime and Drugs of the S. Committee on the Judiciary, 111th Cong. 10 (2009) (statement of Lanny A. Breuer, Assistant Att’y Gen., Criminal Division, United States Department of Justice), available at http://www.justice.gov/ola/testimony/111-1/2009-04-29-crm-breuer-crack-powder.pdf.

[2] The 2009 Annual Report of the U.S. Sentencing Commission reflects that 22.1% of all drug cases for which sentences were imposed that year involved crack cocaine.  2009 U.S. Sent. Comm. Ann. Rep., p. 39-40.

[3] Fed. Bureau of Investigation, Uniform Crime Report: Crime in the United States, 2012 (2013), available at http://www.fbi.gov/about-us/cjis/ucr/crime-in-the-u.s/2012/crime-in-the-u.s.-2012/violent-crime/violentcrimemain.pdf.

[4]Statement of Eric H. Holder, Jr. Att’y Gen. of the United States, Before the Sub Comm. On Commerce, Justice, Science, and Related Agencies of the H.R. Comm. On Appropriations, 113th Cong. 9 (2014) (statement of Eric H. Holder, Jr., Att’y Gen. of the United States) available at http://docs.house.gov/meetings/AP/AP19/20140404/102023/HHRG-113-AP19-Wstate-HolderE-20140404.pdf.

[5] Fed. Bureau of Prisons, State of the Bureau 2010, p. 3 (2010), available at http://www.bop.gov/resources/pdfs/sob10.pdf.

[6] Memorandum from Eric H. Holder, Jr., Att’y Gen. of the United States, to Heads of Dep’t of Justice Components and United States Attorneys on Consideration of Collateral Consequences in Rulemaking (Aug. 12, 2013), available at http://csgjusticecenter.org/wp-content/uploads/2013/09/DOJ-Collateral-Consequences-memo-8-12-13.pdf.

[7] Id.

[8] Id.

[9] See e.g. Devlin Barrett, Justice Department Plans New Crisis-Related Cases, Wall St. Journal, Aug. 20, 2013, available at http://online.wsj.com/news/articles/SB10001424127887323423804579025262544041336.

 

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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