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Huff: The Golden Age of White Collar Crime


Fresh8686

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https://www.huffpost.com/highline/article/white-collar-crime/?utm_source=pocket-newtab

 

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OVER THE LAST TWO YEARS, nearly every institution of American life has taken on the unmistakable stench of moral rot. Corporate behemoths like Boeing and Wells Fargo have traded blue-chip credibility for white-collar callousness. Elite universities are selling admission spots to the highest Hollywood bidder. Silicon Valley unicorns have revealed themselves as long cons (Theranos), venture-capital cremation devices (Uber, WeWork) or straightforward comic book supervillains (Facebook). Every week unearths a cabinet-level political scandal that would have defined any other presidency. From the blackouts in California to the bloated bonuses on Wall Street to the entire biography of Jeffrey Epstein, it is impossible to look around the country and not get the feeling that elites are slowly looting it.

 

And why wouldn’t they? The criminal justice system has given up all pretense that the crimes of the wealthy are worth taking seriously. In January 2019, white-collar prosecutions fell to their lowest level since researchers started tracking them in 1998. Even within the dwindling number of prosecutions, most are cases against low-level con artists and small-fry financial schemes. Since 2015, criminal penalties levied by the Justice Department have fallen from $3.6 billion to roughly $110 million. Illicit profits seized by the Securities and Exchange Commission have reportedly dropped by more than half. In 2018, a year when nearly 19,000 people were sentenced in federal court for drug crimes alone, prosecutors convicted just 37 corporate criminals who worked at firms with more than 50 employees.

 

With few exceptions, the only rich people America prosecutes anymore are those who victimize their fellow elites. Pharma frat boy Martin Shkreli, to pick just one example, wasn’t prosecuted for hiking the price of a drug used to treat HIV from $13.50 to $750 per pill. He went to prison for scamming investors in a hedge fund scheme years before. Meanwhile, in 2016, the CEO whose company experienced the deadliest mining disaster since 1970 served less than one year in prison and paid a fine of 1.4 percent of his salary and stock bonuses the previous year. Why? Because overseeing a company that ignores warnings and causes the deaths of workers, even 29 of them, is a misdemeanor.

 

Construction magnate Bruce Karatz provides an infuriating case study of how the criminal justice system treats wealthy defendants. In 2010, Karatz was convicted of failing to disclose in a financial statement that he had secretly “backdated” his stock options (think Biff with the Sports Almanac in “Back to the Future II”) to boost his pay by more than $6 million. Prior to his sentencing hearing, his lawyer submitted letters of support from former mayor of Los Angeles Richard Riordan and billionaire philanthropist Eli Broad. Prosecutors recommended six-and-a-half-years in prison; the judge gave Karatz five years’ probation and eight months of house arrest in his Bel Air mansion. After two years, the judge terminated the remainder of the sentence. Karatz later received a civic award from The Malibu Times for volunteer work he did to make a good impression for his sentencing hearing.

 

(More at link)

 

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I'm truly shocked by this. You mean to tell me, the so-called justice system works differently for the wealthy than for us unwashed masses?🙄 Mind you, this isn't snark directed at you, but cynicism of the highest order directed at the system. It became apparent to me when the Obama administration didn't do much to prosecute the people responsible for the financial collapse that we are reliving the age of the robber barrons. Since the increased wealth --> power --> wealth feedback loop makes it almost impossible to fix otherwise, I think the only thing that dislodges them now will be another major financial collapse that makes all the culture war crap that currently drives the Grand Oligarch's Party's voters sit up and take notice. At that point, hopefully there will be enough political power concentrated in the hands of one side to make the reforms necessary to keep this cycle from playing out again.

 

I was one of the people arguing in favor of a bailout when the last collapse happened under the silly, antiquated notion that we needed to avoid complete collapse and save the economy. In retrospect, I think it's what the country needed so that we can finally stop smugly crowing about how great capitalism is after the collapse of the Soviet Union and address our systemic ills.

 

FWIW, although corruption in China is probably more prevalent than it is here, this is an area where they're a bit better than we are. When they catch major white collar criminals, they get a death sentence or serious prison time. Kind of hard to come back from that. 😃 Yes, the well-connected typically get off, but at least some of them are being punished. We're doing almost nothing about it in this country to the point that the best way to get away with crime is to either be wealthy or hide behind a badge.

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4 minutes ago, Mooka said:

 

.... if this is an accurate number that's ****ing stunning.  

 

There's more where that came from in the article. 

 

When Bernie Sanders and, to a less bombastic extent, Elizabeth Warren, rail against a system rigged for the millionaire and billionaire class, they could point to this article as the illustration of what they're talking about.

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16 hours ago, stevemcqueen1 said:

I was just reading this, thanks for making a thread to discuss the article.  It's ghastly.  America is in desperate need of a peasant revolt.

 

I guess this is when someone comes and says "be careful what you wish for, you might just get it"?

 

 

04-02-2019-Bernie-Sanders-2160x1200.jpg

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On 2/11/2020 at 10:07 AM, Fresh8686 said:

 

 

 

 

 

They lost me at the over the last two years bit.

 

reminds me of a me too screed that finally decided it mattered now.

 

Bern it all down.

 

 

 

 

 

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On 2/11/2020 at 1:27 PM, Mooka said:

 

.... if this is an accurate number that's ****ing stunning.  

 

Not if you look at why

 

prior to the Sally Yates memo at the start of that time period the policy was corporate criminals escaped prosecution with the corp paying a fine 

The memo changed policy to crediting corps if they turned over info on individuals involved in criminal acts.

 

https://theintercept.com/2016/01/20/obama-justice-department-likes-criminally-prosecuting-people-but-not-corporations/


https://www.steptoe.com/en/news-publications/what-lies-ahead-for-the-yates-memo-in-2019.html

 

https://www.theguardian.com/business/2014/nov/13/us-justice-department-criminals-juvenile-offenders

 

 

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On 2/11/2020 at 12:26 PM, The Sisko said:

I was one of the people arguing in favor of a bailout when the last collapse happened under the silly, antiquated notion that we needed to avoid complete collapse and save the economy. In retrospect, I think it's what the country needed so that we can finally stop smugly crowing about how great capitalism is after the collapse of the Soviet Union and address our systemic ills.

Ding ding ding. 
 

the problems have just been pushed forward to the next guy. And guess what, the next guy isn’t going to want to deal with them either. So the problems will be pushed even further along until there is a giant collapse.

 

focus needs to be on curing the disease, not treating the symptoms. The bailouts did the latter, which Is why they were never going to work.

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