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Forbes
3 days ago
- Business
- Forbes
Justice Department's New White Collar Crime Priorities
Matthew R. Galeotti, the Head of the Criminal Division at the Justice Department has issued a memorandum describing the Justice Department's new policies and enforcement priorities in dealing with collar crime. In describing its areas of focus, the memorandum states 'The Criminal Division must be laser-focused on the most urgent criminal threats to the country. Therefore consistent with the enforcement policies and priorities of this Administration, the Criminal Division will prioritize investigating and prosecuting corporate crime in areas that will have the greatest impact in protecting American Citizens and companies and promoting U.S. interests.' The memorandum lists the following ten areas of white collar crime which the Justice Department is prioritizing: The inclusion of bribery in the list of priorities is noteworthy in the light of President Trump's executive order suspending enforcement of the Foreign Corrupt Practices Act on the basis of it allegedly harming American business competitiveness in international business. The Foreign Corrupt Practices Act criminalizes bribery of foreign officials by American companies. Nor is it reflected in the order to the Manhattan US Attorney to dismiss the bribery charges against NY major Eric Adams that resulted in the resignation of US Attorney Danielle Sassoon who chose to resign rather than follow such an order. Notably missing from the list of priorities is prosecution of income tax fraud. This is particularly noteworthy in the light of a 2021 Treasury report that estimated that the top 1% of earners account for over $160 billion dollars in unpaid taxes annually. However, this is not surprising on the heels of DOGE plans to cut up to 25% of the IRS staff including draconian cuts to the IRS' Criminal Investigations unit which plays an essential role in combating drug and human trafficking, terrorism, tax crimes, financial crimes and money laundering. Also totally missing from the list of priorities is the prosecution of environmental crimes although the global impact of environmental crimes has been estimated by the Financial Action Task Force, a global organization that sets international standards to fight money laundering and terrorist financing to be as high as $281 billion not to mention the cost to society in the destruction of the environment, contamination of naturl resources and public health dangers. In a clear indication of the new goals of the Justice Department, the memorandum states that prosecutors 'must avoid overreach that punishes risk-taking and hinders innovation.' It goes on to say that the Justice Department 'must strike an appropriate balance between the need to effectively identify, investigate, and prosecute corporate and individuals' criminal wrongdoing while minimizing unnecessary burdens on American enterprise.' The famous 2015 memorandum of Deputy Attorney General Sally Yates entitled 'Individual Accountability for Corporate Wrongdoing' which was prompted by criticism of the Justice Department's failure to effectively prosecute individuals in response to the 2008 financial meltdown stressed the intention to prioritize prosecution of individuals for corporate wrongdoing rather than just the corporations themselves. Despite the good intentions to prosecute individuals and thereby provide a true disincentive for white collar criminals to avoid committing such crimes, there was little change in the numbers of individuals prosecuted as compared to actions against corporations which cannot be jailed. For example, 75% of the prosecutions under the Foreign Corrupt Practices Act ( the law President Trump is presently suspending enforcement of) in the six years prior to the Yates memorandum were against companies rather than individuals within the companies and from 2015 to 2024 the number of prosecutions against companies rather than their employees or officers remained the same. Similar to the Yates memorandum, the Galeotti memorandum also states that the Justice Department's 'first priority is to prosecute individual criminals. It is individuals – whether executive, officers or employees of companies – who commit these crimes, often at the expense of shareholders, workers, and American investors and consumers. The Criminal Division will investigate these individual wrongdoers relentlessly to hold them accountable.' The words are laudable as they were in the Yates memo. Whether they will turn into action is another matter. The Galeotti memorandum concludes by saying 'Focused, fair, and efficient white-collar enforcement promotes American economic and national security interests while protecting American taxpayers, investors, consumers, and businesses. Results of the Criminal Division's efforts in this regard will be measured by the practical benefits brought to bear for all relevant parties, not symbolic resolutions against shell entities or running up the scoreboard. We will foster cooperative relationships with those in industry that align with the Department in this pursuit, and we will root out the criminal element that works against these goals. As in everything we do, we will do so with integrity and in the interests of justice.' Actions, however, speak louder than words. On the same day that the Galeotti Memorandum was issued, the FBI, the primary criminal investigative arm of the Justice Department, instructed its agents to target their efforts on immigration enforcement and less time on white collar crime enforcement.
CBS News
23-05-2025
- Business
- CBS News
Boeing reaches $1.1 billion deal with Justice Department to avoid prosecution over 737 Max crashes
Boeing has reached a $1.1 billion deal with the Department of Justice that will allow it to avoid prosecution for two crashes involving its 737 Max jetliners that killed a total of 346 people. Boeing will be required to invest that money in improving the aviation giant's compliance, safety and quality program, while $445 million will be set aside to provide compensation for the families of the victims killed in the crashes, the Justice Department said. The agreement stems from the crashes of Lion Air Flight 610 in 2018 and Ethiopian Airlines Flight 302 in 2019. The deal will allow the company to avoid criminal prosecution for allegedly misleading U.S. regulators about the 737 Max jetliner before the crashes, according to court papers filed Friday. A statement issued on behalf of some relatives of those killed in the crashes blasted the government's deal with Boeing, saying the families felt "tremendous grief and even anger" at the agreement. "This kind of non-prosecution deal is unprecedented and obviously wrong for the deadliest corporate crime in U.S. history. My families will object and hope to convince the court to reject it," Paul Cassell, a professor at the University of Utah's S.J. Quinney College of Law who is representing the families, said in the statement. The Justice Department defended the agreement. "After careful consideration of the families' views, the facts and the law, the department's principles of federal prosecution and the professional and ethical obligations of prosecutors, it is the government's judgment that the agreement is a fair and just resolution that serves the public interest," the court papers state. Boeing didn't immediately respond to a request for comment. Many relatives of the passengers who died in the crashes have spent years pushing for a public trial, the prosecution of former company officials and more severe financial punishment for Boeing. "Nothing will diminish the victims' losses, but this resolution holds Boeing financially accountable, provides finality and compensation for the families and makes an impact for the safety of future air travelers," the Justice Department said in a statement. Aimee Picchi Aimee Picchi is the associate managing editor for CBS MoneyWatch, where she covers business and personal finance. She previously worked at Bloomberg News and has written for national news outlets including USA Today and Consumer Reports. contributed to this report.
