Federal White-Collar Prosecutions Hit ‘All-Time Low’

Federal prosecutions of white-collar crimes have reached an “all-time” low this year, according to the Transactional Records Clearing House (TRAC) at Syracuse University.

As of January 2020, the number of white-collar offenders prosecuted on federal charges had dropped eight percent from the previous year, continuing a slide that began five years ago.

“If prosecutors continue at the same pace for the remainder of FY 2020, they are projected to fall to 5,175—almost half the level of their Obama-era peak,” TRAC said

In January, just 359 defendants were prosecuted—for the most part individuals, rather than firms—representing an “all-time low since tracking began during the Reagan Administration,” TRAC added.

In FY 2010 and FY 2011, annual prosecutions numbered over 10,000.

Critics have long assailed the government for concentrating its white-collar-crime efforts on individuals rather than large corporations and business organizations. Only 1,300 business entities have been hauled into court for white-collar offenses compared with 124,402 individual defendants since 2004—amounting to roughly one out of every 100 cases.

But the drop in prosecutions for individuals suggests a further softening of strategy, economist Catherine Rampell wrote recently in The Washington Post.

“The slide in prosecutions began before President Trump took office,” Rampell wrote. “But the numbers are especially low this year, perhaps in part because his fixation with other kinds of crimes (chiefly, immigration-related ones) has crowded out resources for other kinds of investigations and prosecutions.”

TRAC obtained its figures following successful litigation against the Justice Department under the Freedom of Information Act.

Download the full report and tables here.

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March 4, 2020 at 08:04AM

DOJ Charges 35 in Fraudulent Genetic Testing

The Justice Department announced a crackdown on companies it says were involved in fraudulent genetic testing, bringing charges against 35 people associated with dozens of telemarketing companies and testing labs, reports NPR. The federal investigation, called Operation Double Helix, went after schemes that allegedly targeted people 65 and older. They involved laboratories paying illegal kickbacks and bribes to medical professionals who were working with fraudulent telemarketers, in exchange for the referral of Medicare beneficiaries. DOJ says the frauds cost the Medicare program more than $2 billion in unnecessary charges. Among those charged were 10 medical professionals, including nine doctors. “The elderly and disabled are being preyed upon,” says Joe Beemsterboer of DOJ’s criminal division. It was one of the largest health care fraud schemes in U.S. history, Beemsterboer says.

It worked on many levels, involving many players — from “those collecting patient information, to those selling it, to those doctors corruptly prescribing these genetic tests, to the labs corruptly billing the Medicare program.” Shimon Richmond of the U.S. Department of Health and Human Services inspector general’s office, said telemarketing companies trolled elderly Medicare beneficiaries online, or called them on the phone or even sent people to approach beneficiaries face-to-face at health fairs, senior centers, low-income housing areas or religious institutions like churches and synagogues. Genetic tests may have been offered free to the patients, but there was money to be made from Medicare reimbursement. Typically that payment – anywhere from $10,000 to $18,000 or more, Richmond says — would be split between the worker who recruited the patient, the doctor writing the prescription, the lab that did the test and the telemarketing company that organized the alleged scheme.

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September 30, 2019 at 10:46AM

DOJ Adds 300 Prosecutors, ‘Largest Increase in Decades’

The Department of Justice is adding 300 assistant U.S. attorneys to its rolls around the U.S., referring to the hires as the “largest increase in decades,” The Hill reports. DOJ said the move would “increase resources to combat violent crime, enforce our immigration laws, and help roll back the devastating opioid crisis.” The department said it will add 190 violent crime prosecutors, 86 civil enforcement prosecutors and 35 immigration prosecutors. The department said that many of the civil enforcement assistant U.S. attorneys would help support the Trump administration’s Prescription Interdiction & Litigation Task Force. 

The announcement came as President Trump continues to attack the department for its role in special counsel Robert Mueller’s probe into alleged ties between the Trump presidential campaign and Russia’s election meddling. Trump said last month that he regretted his decision to choose Sessions as attorney general. Sessions has been a target of the president’s ire since he recused himself from Mueller’s Russia probe in 2016. On Tuesday, Trump tweeted: “The Russian Witch Hunt Hoax continues, all because Jeff Sessions didn’t tell me he was going to recuse himself … I would have quickly picked someone else. So much time and money wasted, so many lives ruined.”                      

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DOJ eyeing tool to allow access to encrypted data on smartphones

The Justice Department is in “a preliminary stage” of discussions about requiring tech companies building “tools into smartphones and other devices” that would allow law enforcement investigators to access encrypted data, the New York Times reports.

Why it matters: This has been on the FBI’s mind since 2010, and last month the White House “circulated a memo…outlining ways to think about solving the problem,” officials told the NYT. Both FBI Director Christopher Wray, and Deputy Attorney General Rod Rosenstein, support finding ways for law enforcement to access data without compromising devices security.

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