Complexity of financial crimes makes crooks unconvictable

Following a mistrial in the Dewey & LeBoeuf case -- a complex financial fraud involving a tony white-shoe law firm -- Bloomberg tries to analyze what happened to the jury, who were unable to convict despite four months of hearings and 22 days' worth of deliberations.

The Wall Street Journal reports that the jurors were "inundated by details," and Bloomberg points to a pattern of New York prosecutors failing to secure convictions for financial crimes due, seemingly, to their complexity. This has led to a situation where "trading on material nonpublic information is legal in New York, so long as the person trading on it doesn't know too much about circumstances surrounding the source of the information."

The kicker, though, is in the final paragraph:

The Justice Department acknowledged that things haven't been going too well in this area when it released new guidelines in September for prosecuting corporate crime. One of the key changes, it said, would be that the department would focus more on individual financial criminals. There's nothing wrong with bringing an ambitious case to trial and losing. But the pattern suggests that law enforcement may have lost the ability to choose the right cases, or that it lacks the expertise to try them in a courtroom in a way that makes sense to jurors, many drawn from the ranks of working people who must struggle to understand the vast, mind-boggling modern financial system.


Has It Become Impossible to Prosecute White-Collar Crime?
[Sheelah Kolhatkar/Bloomberg]


(via Naked Capitalism)

(Image: Animated Rube Goldberg Machine by Gavin)

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