New Elizabeth Warren Report Calls On Next President To Get Tough On Corporate Crime
“Enforcement isn’t about big government or small government. It’s about whether government works and who it works for.” — Sen. Elizabeth Warren, New York Times, Jan 29, 2016.
Sen. Elizabeth Warren slams feds on failure to prosecute corporate criminals to the full extent of the law.
A scathing new report from Sen. Elizabeth Warren slams President Barack Obama’s administration for not prosecuting corporate criminals to the full extent of the law. In “Rigged Justice: How Weak Enforcement Lets Corporate Offenders Off Easy (pdf),” Warren demands to know why we spend billions to lock tens of thousands of Americans away in prisons for non-violent crimes, while letting corporate offenders wreak havoc and get off with a slap on the wrist.
When government regulators and prosecutors fail to pursue big corporations or their executives who violate the law or when the government lets them off with a slap on the wrist, corporate criminals have free rein to operate outside the law. They can game the system, cheat families, rip off taxpayers, and even take actions that result in the death of innocent victims—all with no serious consequences.
In the New York Times, Elizabeth Warren takes care to praise the president for his accomplishments despite a hostile, GOP-run Congress:
The Obama administration has a substantial track record on agency rules and executive actions. It has used these tools to protect retirement savings, expand overtime pay, prohibit discrimination against L.G.B.T. employees who work for the government and federal contractors, and rein in carbon pollution. These accomplishments matter.
But, Elizabeth Warren adds, Barack Obama’s administration hasn’t gone far enough. As the 2016 elections loom closer, it’s up to our next president to preserve the above measures while appointing agency heads willing to get as tough on corporate crime as they have on crime (even non-violent crime involving little or no money) by individuals.
Whether the next president will build on them, or reverse them, is a central issue in the 2016 election. But the administration’s record on enforcement falls short — and federal enforcement of laws that already exist has received far too little attention on the campaign trail.
That’s right. Even if the Republicans still control both houses of Congress after the next election, the president still gets to nominate people to run key federal agencies, including the Environmental Protection Agency, the Consumer Financial Protection Bureau, the Labor Department, and the Securities and Exchange Commission. And, as Elizabeth Warren points out, the law clearly states that the individuals running a company can be held accountable for crimes committed by that company.
The only candidate who talks much about corporate crime is Bernie Sanders. But even he mostly focuses on Wall Street and the banking industry. Elizabeth Warren’s report also cites a terrifying lack of enforcement in the areas of education, student loans, automobile safety, occupational safety, environmental laws, trade laws, and drug manufacturer fraud and misrepresentation.
Among the companies listed in Elizabeth Warren’s report whose executives got off lightly after crimes of great magnitude were committed under their charge:
- Education Management Corporation (EDMC): They loaded students with ruinous (and federally backed!) student loan debt for fraudulent college degrees, but settled with no admission of wrong doing. Not a single executive was held accountable, and they’re still up to the same old tricks
- General Motors (GM): They covered up their faulty ignition switches, causing “at least 124 deaths and 275 injuries,” yet the Dept. of Justice let them off with a paltry $900 million fine.
- Standard & Poor’s (S&P): They scammed investors with pumped up credit ratings for mortgage-backed securities and crashed our economy to the tune of trilions of dollars. The DOJ let them off with a $1.375 billion settlement and not a single executive went to jail.
- “The Cartel”: Citigroup, JPMorgan, Chase, Barclays, UBS, AG, and the Royal Bank of Scotland paid the DOJ just $5.6 billion after they manipulated exchange rates for profit for over five years.
- Novartis: To sell more drugs to Medicare and Medicaid patients, they screwed taxpayers through a kickback scheme with pharmacists. The DOJ then had them settle for only $390 million — only 10 percent of the damages sought. And of course no one admitted any wrongdoing, and Novartis still gets money from government healthcare programs.
- Massey Energy Company: After the Big Branch mine explosion killed 29 workers in 2010, then-CEO Donald L. Blankenship was convicted of only one misdemeanor (and is among the few executives who’ve ever gone to trial) in spite of the fact that his company was cited for 2,400 safety violations just for 2009.
- British Petroleum (BP): The Deepwater Horizon oil spill is one of the greatest environmental disasters in our nation’s history, yet the DOJ let them settle for just $20.8 billion — $15 billion of which they get to deduct from their taxes!
So why corporate chieftains get off so lightly for their crimes against humanity, and rarely even go to trial? Because our federal government agencies aren’t going after them. As Elizabeth Warren points out in her New York Times editorial, this will never change unless We the People demand it.
Legislative agendas matter, but voters should also ask which presidential candidates they trust with the extraordinary power to choose who will fight on the front lines to enforce the laws. The next president can rebuild faith in our institutions by honoring the simple notion that nobody is above the law, but it will happen only if voters demand it.