The cost-benefit analysis almost always favors the criminal for white collar crimes (or any non-violent crime, really) when you have money. If I had $100m+ I wouldn't really pay attention to the law either.
I don't think your assertion is true.
> I don't think your assertion is true.
I think you just haven't bothered to look.
First, our prosecutors arn't convicting, they are settling. HSBC paid 5 weeks of yearly profit for cartel money laundering.
https://www.marketwatch.com/story/netflix-documentary-re-exa...
The justice department also called this a fair punishment for an unrelated money laundering crime for Saudi nationals funding of terrorism. They didn't even bother to bring charges. (Which is a perfect answer to your question.)
EX: "In June 2009, the SEC sued Angelo Mozilo, former CEO of mortgage lender Countrywide Financial, and two other former officers, charging that they misled investors about the quality of Countrywide's loans while knowing the company was fueling its growth by letting its underwriting guidelines deteriorate and originating a growing number of risky subprime loans. In October 2010, the SEC settled the lawsuit and Mozilo was required to pay a fraction of the $521.5 million he had earned, just $67.5 million in penalties" https://en.wikipedia.org/wiki/List_of_major_SEC_enforcement_...
But I'm not going to list a howto ;)
If all you lose is the income from illegal activity and a small fine it’s not much of a penalty now is it? The criminal justice system needs to be as vicious against criminals as collection agencies are against poor people.
I really have no problem seizing absolutely everything from somone who manipulates markets or defrauds investors. In fact, step it up. Seize everything and stick them with a lifetime of debt that can’t be discharged.
There is very little evidence that any elections in the US have been affected by fraud by any significant amount.
For example, in Georgia, US, one of the candidates himself blocked 53,000 voter registrations just 3 weeks before the election. The demographics of the 53,000 is 70% black.
https://www.npr.org/2018/10/13/657109536/georgia-puts-53-000...
Gerrymandering, strict voter id laws (e.g. requiring drivers license but removing all but one DMV in the entire county in opponent's strongholds) and similar are also various ways to negatively affect election integrity.
So to say that 'we definitely don't have an "election integrity" issue' isn't correct. There is nothing definite about it - we just have a consensus that we don't have a problem. You could say the same about every data security breach until they were discovered. I have noticed that there is a significant cultural interest in propagating the idea that our elections are sound so I tend to take the idea with a grain of salt as long as our system is as vulnerable as it is.
Disenfranchisement, gerrymandering, polling place reductions, unequal representation, etc. are, however, quite rampant. Not all votes are equal in the US, and not all voters are treated as equal either. The result is the same (subversion of democracy), but the tactics are different.
The idea that the US doesn't have election integrity issues is simply false.
No, if being well-connected means your crime gets left alone, you have a country run by, and for, gangsters. That's the initial condition, not the long term result if the situation continues.
If you do it long enough, people notice that the country is being run by and for gangsters.
Here are some of those reasons.
$3 for every $1 is an extremely misleading way of putting it, as though the IRS is a business and everything is good as long as it's turning a profit. A better way of putting it is that collecting taxes through enforcement has ~33% overhead, which is high. By comparison, the overhead of normal IRS tax collection is a fraction of a percent.
It also only accounts for the government's side of the expense, not the cost (and stress) imposed on innocent taxpayers who get audited to no avail in order to catch the smaller number of people who were actually committing tax fraud, and who are almost always small business owners because they're the ones with unusual tax returns. So the actual cost is even higher and is paid by a group of innocent people who create a disproportionately large amount of economic value while being at high risk of becoming unviable when you impose large surprise costs and time commitments on them like that.
The IRS also prioritizes its enforcement to maximize effectiveness, which means they're already taking the low hanging fruit and increased enforcement would be at the margin rather than at the existing average. For the average to be at parity you would need to be doing a lot of audits that cost more than the revenue they generate in order to cancel out the revenue gained from the net-positive enforcement that is already occurring.
It's possible that we could actually raise government income by doing less enforcement, because $3 is the average. It would be a net gain to eliminate the ones where we're spending $1 to raise $.50 (or $0) as long as we keep the ones where we spend $1 to raise $20.
Case in point: no one would argue the Nazi regime was anything approaching "good", but when the war was done, we didn't throw away the V2 rocket and start research from scratch. We threw out all the horrible shit the Nazis did but kept their wildly successful rocket.
Likewise, it's possible to throw away the racist bullshit that perpetuates the drug war but use it's funding mechanism to fund prosecution of other crimes that would otherwise be financially infeasible to prosecute otherwise. If someone is convicted of insider trading, take all the money they gained from it and use it to prosecute other insider trading crimes.
https://www.nytimes.com/2016/02/07/your-money/vanguard-a-cha...
The UK's GAAR has this trick called a "double reasonableness test" which it uses to get rid of some types of tax _avoidance_ and that seems like an appropriate legal rule here if, in fact, the IRS does abuse this discretion.
The double reasonableness test asks this:
Could any reasonable person (not you, the jury member, judge or whatever, but some other reasonable person you're capable of imagining) think that this way of doing things was reasonable ?
Only if the answer is "No", which it will be only for the most extraordinarily tortured ways of avoiding tax, then this method of avoiding tax is prohibited. You don't go to jail or anything, your avoidance trick just doesn't work and you owe the taxes as usual.
What we do need is vastly more resources for financial regulators, as well as courts. Yes the laws and regs could also be improved, but that is a harder problem. The easy problem is that the people doing good work to combat financial crimes only have the staffing and money to go after a small, small fraction of likely targets. And the courts do not have what they need to handle a high volume of increasingly complex, technical subject-matter.
That used to be the FBI's main job, but since 2001 they've been mostly ignoring white collar crimes to focus on counterterrorism.
My goodness that documentary had me so infuriated. If people haven't seen it, I highly recommend it.
> The only bank to be prosecuted criminally for shenanigans in the subprime era.
That's the amazing part. Out of all the multinational "too big to fail" banks in NYC, they went after a small community bank. Just on optics it looks terrible, but the bank they went after actually had very low numbers of defaults and foreclosures.
That was as clear a case of bullying as I've seen. They went after the smallest bank they could find to intimidate them and force them to settle so that they can tell the press the banks were punished for the financial crisis. Which would have been a farce had they succeeded.
https://www.pbs.org/video/abacus-small-enough-to-jail-suqmxe...
The enforcement still wasn't enough in my opinion, but (and I'm struggling to find a source backing me up) I believe there were several hundred of these cases. None, however, from the big banks that arguably should take more of the blame.
They had some brokers that they fired, before any criminal action had been filed, when a senior manager noted indiscrepancies in the closing process (like writing multiple small checks for down payments and closing costs).
White collar crimes are murkier. There is, for example, nothing illegal about getting the upper hand in a transaction. But it can be illegal based on little more than what the seller knew or was thinking at the time of the sale. Even things like false claims to the government often turn on little more than the characterization of certain transactions. A great deal of the white collar prosecutions I've seen have left me unsettled--the evidence was murky or subject to different characterizations, and the "wrong" often turned on the unknowable--the accused's knowledge or intent.
If there's no victim, there's no crime.
(And, yes, identical logic does apply equally to illegal drugs).
Drug approval services provided by government are there because we want added safety - not to be told what to do.
The U.S. has prosecuted white collar crimes in the past, and has underfunded and hamstrung its enforcement now. They could prosecute them again.
While it may be, I found it difficult to get into. I felt like I was reading a long rant that was peppered w/ interesting facts here and there. I put it down years ago with the intent to try again. I've not gotten back to it yet.
A book I recommend that does touch on the S&L scandal is Lying for Money (Dan Davies). The Outlaw Bank (Beaty & Gwynne) was also an awesome read.
As for the greater topic of white collar crime, it's a key ingredient of the cake, forever to be baked in. My professional advise to folks is simply to be aware of that and act accordingly. Can't say much more than that on the matter.
Now a $20M fine and a year in prison would make them think twice. More often than not, they make more in the commission of their crimes than they are fined, so they still come out in the black. In other words, they aren't truly punished.
Elon Musk was forcibly removed as Tesla's chairman. That was the real punishment. Furthermore, Elon Musk agreed that two new board members would be selected by the SEC. Finally, Tesla promised that they'd watch Elon Musk's twitter account better.
The $20 Million was a slap on the wrist. The "real" punishment from the SEC were those new restrictions, which should clamp down on Musk's behavior.
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No one wants to see Tesla or Elon go bankrupt. The SEC just wants Elon to be more factual in his tweets. Neither jail nor fines help anybody.
IMO, the SEC should have threatened Elon Musk's CEO position a bit more (I mean... they could push him out of any officer position in publicly traded companies), but there's a strong argument that Tesla wouldn't survive if Elon were forced out.
The United States needs to reduce its prison population, not increase it.
Suggesting he be banned from serving as CEO would be much more reasonable, though I think the fine was more than enough.
https://twitter.com/matt_levine/status/1033185120520417280
Tldr: "cracking down on fraud" will mostly harm poor people
