History > 2008 > USA > Justice > Federal justice (II)

Freddie Mac and Fannie Mae

Receive Subpoenas

September 30, 2008
By REUTERS
The New York Times

Fannie Mae and Freddie Mac, the mortgage finance giants that were taken over by the government this month, said Monday that they were subpoenaed for documents as part of a federal grand jury investigations into their accounting.

The United States attorney’s office for the Southern District of New York subpoenaed the two on Friday for documents related to accounting, disclosure and corporate governance dating from Jan. 1, 2007, to the present.

The Securities and Exchange Commission is also investigating these matters and directing the companies to preserve the documents, Fannie Mae and Freddie Mac said.

Both companies said they would cooperate.

The Federal Bureau of Investigation said last week that it was expanding its inquiry of possible corporate fraud related to the mortgage market collapse to include Fannie Mae, Freddie Mac, Lehman Brothers and the giant insurer American International Group.

The allegations would deal with misstatements of assets, the F.B.I. director, Robert Mueller, told Congress earlier this month.

Financial upheaval tied to the mortgage market meltdown has propelled the government toward a $700 billion financial rescue package.

With the broader stock markets down more than 3 percent, shares of Fannie Mae were up more than 6 percent at $2.11 and Freddie Mac’s shares were little changed at around $1.85.

    Freddie Mac and Fannie Mae Receive Subpoenas, NYT, 30.9.2008, http://www.nytimes.com/2008/09/30/business/30subpoena.html

No Charges Expected in Dismissal of Attorneys

September 29, 2008
The New York Times
By ERIC LICHTBLAU

WASHINGTON — A Justice Department investigation offers a blistering critique of the political motivations that led to the firings of a group of United States attorneys in late 2006 but stops short of recommending criminal charges against former Attorney General Alberto R. Gonzales or others in the affair, officials said.

The Justice Department’s inspector general and its Office of Professional Responsibility have been investigating the firings since last year, trying to determine who in the Bush administration ordered the firings, whether the dismissals were intended to thwart investigations and whether anyone had broken the law in carrying out the firings or in testifying about them.

Officials with the department refused to discuss the report in advance of its scheduled release on Monday, though it has been the subject of Web reports since Friday. A lawyer for Mr. Gonzales declined to comment.

Mr. Gonzales, who resigned last year after coming under criticism because of the firings, has been the main focus of interest, in part because several members of Congress charged that he may have perjured himself in his testimony through his memory lapses and misstatements about the firings.

But officials with knowledge of the inspector general’s investigation and defense lawyers who have been involved in it said they did not expect that the investigation would recommend that criminal charges be pursued at this point against Mr. Gonzales or other officials. The report was expected to recommend that investigators continue to pursue some elements of the case, meaning that the legal questions around Mr. Gonzales would continue.

One former official with knowledge of the investigation, who like others spoke about the report only on condition of anonymity, said that much of the criticism in the findings was expected to center on Kyle Sampson, who was Mr. Gonzales’s chief of staff and carried out the firings of eight prosecutors.

The report was also expected to produce evidence that Mr. Sampson was carrying out directives crafted by more senior officials, including Mr. Gonzales; Karl Rove, the former political adviser to President Bush; and Harriet E. Miers, a former White House counsel. A lawyer for Mr. Sampson declined to comment.

A lawyer with knowledge of the investigation said the report would not change the basic story line that the prosecutors, several of whom were working on sensitive public corruption cases, were fired in large part because they were not considered loyal team players who could faithfully carry out the White House’s agenda.

But the investigation did unearth some e-mail messages that were not disclosed to Congressional investigators during their own review of the controversy last year, the lawyer said, and that e-mail and other evidence are expected to shed new light on the motivations for the firings.

The dismissal that has drawn the most scrutiny is that of David C. Iglesias, who was fired as the United States attorney in New Mexico after clashing with Republicans over what they saw as his slow pursuit of Democrats in a corruption investigation.

One central question is the role officials at the White House, including Mr. Rove and Ms. Miers, played in the firings. But Paul K. Charlton, who was fired as United States attorney in Arizona after clashing with supervisors in Washington over a number of policies and investigations, said he was concerned that the inspector general’s limited jurisdiction and the White House’s refusal to turn over key records might have stymied the investigation.

The inspector general and the Office of Professional Responsibility, which conducted a joint investigation, have kept their findings under tight guard before the public release, declining to discuss any details with central players in the investigation or their lawyers. “It’s been a lockdown,” one defense lawyer said.

    No Charges Expected in Dismissal of Attorneys, NYT, 29.9.2008, http://www.nytimes.com/2008/09/29/washington/29attorneys.html?hp

Trial opens for man accused of slaying judge

Mon Sep 22, 2008
10:42pm EDT
Reuters

ATLANTA (Reuters) - The U.S. trial opened on Monday of a man accused of murdering a federal judge in a courtroom and three other people during his escape from custody three years ago.

Brian Nichols, 36, pleaded not guilty by virtue of insanity to a series of charges including murder, kidnapping, robbery, aggravated assault and carjacking, according to local television reports.

Prosecutors at Atlanta municipal court are seeking the death penalty in a case that stems from events that gained Nichols instant notoriety and shocked many Americans.

Nichols is accused of overpowering a security guard at Fulton County Courthouse in Atlanta in March 2005, where he was being tried for rape.

He allegedly took the guard's gun and entered the courtroom where he shot dead Judge Rowland Barnes and a court reporter in the presence of several witnesses.

He is also accused of killing a deputy sheriff outside the court. Prosecutors say in the manhunt that followed, Nichols killed a federal agent, hijacked up to five cars and held a woman hostage in her home north of Atlanta before giving himself up.

The case had stalled over funding for the defense team, leading several Georgia legislators to complain about the slowness of the trial. But a new judge, James Bodiford, was named in February and said he was determined to speed up the trial.
 

(Writing by Matthew Bigg)

    Trial opens for man accused of slaying judge, R, 22.9.2008, http://www.reuters.com/article/domesticNews/idUSTRE48M0YD20080923

Cheney Is Ordered to Preserve Wide Set of Records

September 20, 2008
Filed at 7:41 p.m. ET
By THE ASSOCIATED PRESS
The New York Times

WASHINGTON (AP) -- A federal judge on Saturday ordered Dick Cheney to preserve a wide range of the records from his time as vice president.

The decision by U.S. District Judge Colleen Kollar-Kotelly is a setback for the Bush administration in its effort to promote a narrow definition of materials that must be safeguarded under by the Presidential Records Act.

The Bush administration's legal position ''heightens the court's concern'' that some records may not be preserved, said the judge.

A private group, Citizens for Responsibility and Ethics in Washington, is suing Cheney and the Executive Office of the President in an effort to ensure that no presidential records are destroyed or handled in a way that makes them unavailable to the public.

In a 22-page opinion, the judge revealed that in recent days, lawyers for the Bush administration balked at a proposed agreement between the two sides on how to proceed with the case.

Cheney and the other defendants in the case ''were only willing to agree to a preservation order that tracked their narrowed interpretation'' of the Presidential Records Act, wrote Kollar-Kotelly.

The administration, said the judge, wanted any court order on what records are at issue in the suit to cover only the office of the vice president, not Cheney or the other defendants in the lawsuit. The other defendants include the National Archives and the archivist of the United States.

In response to the ruling, Cheney spokesman James R. Hennigan said that ''we will not have any comment on pending litigation.''

The lawsuit stems from Cheney's position that his office is not part of the executive branch of government.

This summer, Cheney chief of staff David Addington told Congress the vice president belongs to neither the executive nor legislative branch of government, but rather is attached by the Constitution to Congress. The vice president presides over the Senate.

The lawsuit alleges that the Bush administration's actions over the past 7 1/2 years raise questions over whether the White House will turn over records created by Cheney and his staff to the National Archives in January.

In 2003, Cheney asserted that the office of the vice president is not an entity within the executive branch.

Two historians and three groups of historians and archivists joined CREW in filing the suit two weeks ago.

    Cheney Is Ordered to Preserve Wide Set of Records, NYT, 20.9.2008, http://www.nytimes.com/aponline/washington/AP-Cheney-Lawsuit.html?hp

Abramoff Gets 4 Years in Prison for Corruption

September 5, 2008
The New York Times
By NEIL A. LEWIS

WASHINGTON — Jack Abramoff, the onetime flamboyant lobbyist who amassed a fortune by showering gifts on Congressional and executive branch officials while bilking Indian tribes of millions of dollars, was sentenced Thursday to four years in prison.

Judge Ellen S. Huvelle of Federal District Court here ordered that Mr. Abramoff serve the time for corruption and tax offenses uncovered by an influence-peddling investigation that touched Republican leaders in Congress and midlevel officials in the Bush administration, among others. Judge Huvelle said Mr. Abramoff had engaged in “a consistent course of corrupt conduct.”

Mr. Abramoff, who came to symbolize an out-of-control, even brazen style of courting government officials, told Judge Huvelle he had since realized how far he had stepped over the bounds of what was permissible. Wearing a worn brown T-shirt, pants with an elastic waistband and a Jewish skullcap, he apologized profusely and in a quavering voice said he was begging for mercy. “I have fallen into an abyss,” he said. “My name is the butt of a joke.”

The sentencing process was unusual and complicated by many factors. Prosecutors had asked Judge Huvelle to sentence Mr. Abramoff to a term less than the approximately 11 years allowed by federal sentencing guidelines to reflect his extensive cooperation with investigators.

Although the Justice Department typically exhorts judges to hand down stiff sentences, a prosecutor, Mary K. Butler, argued vigorously for a reduced jail term to encourage other criminals to cooperate in exchange for a lenient sentence.

Mr. Abramoff, Ms. Butler said, contributed substantially to the conviction of about 10 officials, including a member of Congress, Bob Ney, Republican of Ohio. “We need to send a message to our other cooperators,” Ms. Butler said.

Judge Huvelle said she had recognized Mr. Abramoff’s cooperation by sharply reducing his sentence. But she noted the corrosive effect of his behavior on public trust in government and, in the end, sentenced him to nine months longer than the 39-month sentence the government had sought. Mr. Abramoff, who is described by his lawyers as penniless, still owes about $15 million in restitution to various Indian tribes.

Mr. Abramoff has served about two years of a separate sentence in an unrelated fraud case in Florida involving cruise ships. In all, Mr. Abramoff will serve about six years in prison on both convictions.

Beginning shortly after the Republican takeover of Congress in 1994, Mr. Abramoff was at the center of a lobbying conglomerate that defrauded Indian tribes of millions and used much of that money to try to win favor with members of Congress and their senior staff members. Mr. Abramoff and his informal business partner, Michael Scanlon, an independent public-relations consultant who had been a spokesman for Representative Tom DeLay of Texas, the House Republican leader at the time, took in an estimated $66 million in fees from Indian tribes in just a few years.

Two Indian leaders urged the judge to impose the stiffest possible sentence.

Bernie Sprague, who had been a member of the tribal council of the Saginaw Chippewa in Michigan, said Mr. Abramoff had defrauded his tribe out of millions of dollars. Records produced at a Senate hearing showed that Mr. Abramoff had persuaded the tribe to donate to several political figures, including Mr. DeLay.

“Families and children suffered much pain because of this man,” Mr. Sprague said, pointing to Mr. Abramoff. He said that Mr. Abramoff had left a “dark stain” across the entire Indian nation, adding, “Thank you, Jack!”

David Sickey of the Coushatta Tribe of Louisiana told the court that Mr. Abramoff had exploited the tribe’s lack of sophistication. “Please give Jack Abramoff a sentence that reflects the enormity of his crime and which takes into account his failure to return the money he stole from our people,” Mr. Sickey said.

In his high-flying days, Mr. Abramoff was the master of the Congressional junket, flying dozens of members of Congress and their aides to high-priced resorts, the most infamous of which was a golf course in Scotland.

    Abramoff Gets 4 Years in Prison for Corruption, NYT, 5.9.2008, http://www.nytimes.com/2008/09/05/washington/05abramoff.html?hp

Judge Rules Bush Advisers Can’t Ignore Subpoenas

August 1, 2008
The New York Times
By DAVID STOUT

WASHINGTON — President Bush’s top advisers cannot ignore subpoenas issued by Congress, a federal judge ruled on Thursday in a case that involves the firings of several United States attorneys but has much wider constitutional implications for all three branches of government.

“The executive’s current claim of absolute immunity from compelled Congressional process for senior presidential aides is without any support in the case law,” the judge, John D. Bates, ruled in United States District Court here.

Unless overturned on appeal, the ruling would require a former White House counsel, Harriet E. Miers, and the current White House chief of staff, Joshua B. Bolten, to cooperate, at least partly, with the House Judiciary Committee, which has been investigating the dismissal of the federal prosecutors in 2006.

By implication, the ruling could also affect Karl Rove, former chief political adviser to Mr. Bush, who has also resisted appearing before Congressional inquiries that concern the Justice Department during the Bush administration.

While the ruling is the first in which a court has agreed to enforce a Congressional subpoena against the White House, Judge Bates called his 93-page decision “very limited” and emphasized that he would rather see the dispute resolved through political negotiations.

Mr. Bush’s chief spokeswoman, Dana Perino, said that the White House was studying the decision and that “once we’ve had a chance to do that, we’ll consider whether the decision should be appealed.”

Before the ruling, several lawyers said it would almost surely be appealed, no matter which way it turned, because of its importance. Given that probability, it appears unlikely that Ms. Miers, Mr. Bolten or Mr. Rove will be testifying before Congress any time soon.

Ms. Perino, speaking to reporters on Air Force One on the way to Kennebunkport, Me., noted that Judge Bates had not ruled on the merits of any specific executive privilege claim and had in fact said that some considerations, like national security, might justify such a claim.

Ms. Miers and Mr. Bolten, citing legal advice from the White House, have refused for months to comply with Congressional subpoenas. The White House has repeatedly invoked executive privilege, the doctrine that allows the advice that a president gets from his close advisers to remain confidential.

In essence, the judge — whom Mr. Bush appointed in 2001 — held that whatever immunity from Congressional subpoenas that executive branch officials might enjoy, it was not “absolute.” And in any event, he said, it is up to the courts, not the executive branch, to determine the scope of its immunity in particular cases.

The ruling was the latest setback for the Bush administration, which maintains that current and former White House aides are immune from Congressional subpoena. On Wednesday, the House Judiciary Committee voted along party lines to recommend that Mr. Rove be cited for contempt for ignoring a committee subpoena.

The House has already voted to hold Ms. Miers and Mr. Bolten in contempt for refusing to testify or to provide documents about the dismissals of the United States attorneys, which critics of the administration have suggested were driven by an improper mix of politics and decisions about who should or should not be prosecuted.

Last December, the Senate Judiciary Committee voted to hold Mr. Bolten and Mr. Rove in contempt for refusing to comply with subpoenas. The full Senate has yet to act.

The House Judiciary Committee, acting on behalf of the full House, brought the lawsuit that led to the ruling by Judge Bates. In rejecting the administration’s request to dismiss the suit altogether, the judge said Ms. Miers could not simply ignore a subpoena to appear but must state her refusal in person. Moreover, he ruled, both she and Mr. Bolten must provide all nonprivileged documents related to the prosecutors’ dismissals.

Democrats in Congress issued statements in which they claimed victory and said they looked forward to hearing from the appropriate White House officials.

“I have long pointed out that this administration’s claims of executive privilege and immunity, which White House officials have used to justify refusing to even show up when served with Congressional subpoenas, are wrong,” said Senator Patrick J. Leahy, Democrat of Vermont, who is chairman of the Senate Judiciary Committee.

Mr. Leahy’s counterpart in the House, Representative John Conyers Jr., had a similar reaction. “Today’s landmark ruling is a ringing reaffirmation of the fundamental principle of checks and balances and the basic American idea that no person is above the law,” said Mr. Conyers, a Michigan Democrat who is chairman of the House Judiciary Committee.

Aitan Goelman, a former assistant United States attorney in New York City who also worked in the Justice Department’s terrorism and violent crime section, said in an interview on Thursday that there was never a chance that Judge Bates would dismiss the suit outright. Deciding issues like those raised in the suit, he said, “is what courts do” and have done for two centuries.

    Judge Rules Bush Advisers Can’t Ignore Subpoenas, NYT, 1.8.2008, http://www.nytimes.com/2008/08/01/us/01subpoena.html

Court Backs Bush on Military Detentions

July 16, 2008
The New York Times
By ADAM LIPTAK

President Bush has the legal power to order the indefinite military detentions of civilians captured in the United States, the federal appeals court in Richmond, Va., ruled on Tuesday in a fractured 5-to-4 decision.

But a second, overlapping 5-to-4 majority of the court, the United States Court of Appeals for the Fourth Circuit, ruled that Ali al-Marri, a citizen of Qatar now in military custody in Charleston, S.C., must be given an additional opportunity to challenge his detention in federal court there. An earlier court proceeding, in which the government had presented only a sworn statement from a defense intelligence official, was inadequate, the second majority ruled.

The decision was a victory for the Bush administration, which had maintained that a 2001 Congressional authorization to use military force after the Sept. 11 attacks granted the president the power to detain people living in the United States.

The court effectively reversed a divided three-judge panel of its own members, which ruled last year that the government lacked the power to detain civilians legally in the United States as enemy combatants. That panel ordered the government either to charge Mr. Marri or to release him. The case is likely to reach the Supreme Court.

How helpful the decision will be to Mr. Marri remains to be seen, as the majority that granted him some relief was notably vague about what the new court proceeding should look like. In that respect, Tuesday’s decision resembled last month’s decision from the United States Supreme Court granting habeas corpus rights to prisoners held at Guantánamo Bay.

Mr. Marri is the only person on the American mainland known to be held as an enemy combatant. The government contended, in a declaration from the defense intelligence official, Jeffrey N. Rapp, that Mr. Marri was a Qaeda sleeper agent sent to the United States to commit mass murder and disrupt the banking system.

Mr. Marri was arrested on Dec. 12, 2001, in Peoria, Ill., where he was living with his family and studying computer science. He was charged with credit-card fraud and lying to federal agents, and was on the verge of a trial on those charges when he was moved to military detention in 2003.

Brian Roehrkasse, a Justice Department spokesman, said the decision properly recognized “the president’s authority to capture and detain Al Qaeda agents who, like the 9/11 hijackers, come to this country to commit or facilitate warlike acts against American civilians.”

Mr. Roehrkasse added that while the department believed that Mr. Marri “had already received all the process he was due,” its lawyers were “studying the court’s decision and will respond to Mr. Marri’s contentions” before the trial judge.

Jonathan L. Hafetz, a lawyer for Mr. Marri with the Brennan Center for Justice at the New York University School of Law, called the Fourth Circuit’s decision deeply disturbing.

“This decision means the president can pick up any person in the country — citizen or legal resident — and lock them up for years without the most basic safeguard in the Constitution, the right to a criminal trial,” Mr. Hafetz said.

The 216-page decision included seven opinions, none of which commanded a majority. The only common ground was four unsigned paragraphs at the beginning of the decision summarizing the result.

The Fourth Circuit is generally considered the nation’s most conservative federal appeals court. The closely divided and complex decision in a major terrorism case therefore came as something of a surprise.

Mr. Marri’s unusual situation played a role, said Robert M. Chesney, a law professor at Wake Forest University. Mr. Marri “was lawfully present in the U.S. and then arrested and held here, as opposed to being a noncitizen captured in a foreign land,” Professor Chesney said. “This consideration makes his case more difficult even in the eyes of relatively conservative jurists.”

The five judges who ruled that the president has the authority to detain people captured in the United States offered differing criteria for who might be subject to such detention.

Judge J. Harvie Wilkinson III said the president might detain members of organizations or nations against which Congress had authorized the use of force who mean to harm people or property to further military goals.

To reverse the trial judge’s decision allowing Mr. Marri’s detention to continue “because he was not captured on a foreign battlefield or foreign soil,” Judge Wilkinson wrote, “is akin to a judicial declaration that Congress and the executive may fight only the last war.”

Judge Diana Gribbon Motz, writing for herself and three other judges, disagreed, saying that Mr. Marri was at most a civilian criminal who may be prosecuted in the courts but not detained by the executive branch.

“This does not mean that al Marri, or similarly situated American citizens, would have to be freed,” Judge Motz wrote. “Like others accused of terrorist activity in this country, from the Oklahoma City bombers to the convicted September 11th conspirator [Zacarias Moussaoui] they could be tried on criminal charges and, if convicted, punished severely. But the government would not be able to subject them to indefinite military detention.”

Judge William B. Traxler Jr. was the swing vote. He agreed that Mr. Marri was subject to detention if what the government said about him was true. But Judge Traxler broke with the judges who voted against Mr. Marri across the board. Those judges said Mr. Marri had already had an adequate opportunity to challenge his detention in court, in the proceeding based on Mr. Rapp’s statement. Judge Traxler said that Mr. Marri must be given a fair and meaningful opportunity to see and refute “the most reliable evidence” against him, subject to national security and other concerns.

The four judges who would have ordered Mr. Marri’s release from military custody — Judges Motz, Roger L. Gregory, M. Blaine Michael and Robert B. King — agreed to join an order returning the case to the trial court based on Judge Traxler’s middle ground. They did so, Judge Motz wrote, “to give practical effect to the conclusions of the majority of the court who reject the government’s position.”

But Judge Gregory expressed frustration over the net effect of the exercise. “There is no concrete guidance as to what further process is due” Mr. Marri, he wrote.

All of the judges who would have denied Mr. Marri any relief — Judges Wilkinson, Karen J. Williams, Paul V. Niemeyer and Allyson K. Duncan — were appointed by Republican presidents; all who would have granted him full relief were appointed by Democrats. Judge Traxler was appointed to the appeals court by President Bill Clinton.

In the conclusion of his long opinion, Judge Wilkinson said terrorism cases presented courts with special challenges.

“We may never know,” he said, “whether we have struck the proper balance between liberty and security, because we do not know every action the executive is taking and we do not know every threat global terror networks have in store.”

    Court Backs Bush on Military Detentions, NYT, 16.7.2008, http://www.nytimes.com/2008/07/16/washington/16combatant.html?hp

Op-Ed Contributor

The Justice Department, Blind to Slavery

July 11, 2008
The New York Times
By JOHN R. MILLER

Washington

PRESIDENT BUSH has won support abroad and bipartisan praise at home for his efforts to combat human trafficking, the slavery of our time. But now that work is imperiled by his own Department of Justice.

At the United Nations in 2003, Mr. Bush denounced the sex trafficking of women and girls around the world. A little more than two years later, he signed into law a bill that included a broad array of measures to reduce the domestic demand for sex trafficking.

Sex slavery is not the only modern incarnation of this ancient institution — factory slavery, farm slavery and domestic servitude are still with us — but it is the largest category of slavery in the United States. People who have spoken with the president say that he wants the fight to end modern slavery to be one of his legacies as president.

From 2002 to 2006, I led the State Department’s efforts to monitor and combat human trafficking. I felt my job was to nurture a 21st-century abolitionist movement with the United States at the lead. At times, my work was disparaged by some embassies and regional bureaus that didn’t want their host countries to be criticized. I didn’t win every battle, but the White House always made it clear that the president supported my work and thought it was important.

Imagine my surprise, then, when the Justice Department started a campaign against a new bill that would strengthen the government’s anti-human trafficking efforts. In a 13-page letter last year, the department blasted almost every provision in the new bill that would reasonably expand American anti-slavery efforts.

Should the State Department’s annual report on trafficking, which grades governments on how well they are combating modern slavery, consider whether governments put traffickers in jail? The Justice Department says no. Should the Homeland Security and Health and Human Services Departments streamline their efforts to help foreign trafficking victims get visas and care? No. Should the Homeland Security, Health and Human Services, State and Justice Departments pool their data on human trafficking to help devise strategies to prevent it? Amazingly, no.

In its letter, the Justice Department even opposes authorizing the president to create new awards for the international groups that are leading the struggle for abolition. It also doesn’t want the State Department to be required to give the names of American anti-trafficking phone lines to visa applicants at American consulates overseas. It doesn’t want a citizen task force to help develop an information pamphlet for victims.

Some objections like these are, regrettably, to be expected in a Washington turf battle. But the Justice Department is consistent — it opposes changes to expand its own efforts to combat human trafficking, too.

Should the department prosecute the American sex tourists who create demand for adult human-trafficking victims in foreign countries? No. Should Congress make clear that there should be increased penalties for Americans who sexually abuse children abroad? No way. Should we give our courts jurisdiction over Americans who traffic human beings abroad? Certainly not. Should the attorney general include information in his annual report on his department’s efforts to enforce anti-trafficking laws against federal contractors and employees? No. Too “burdensome,” says the Justice Department.

The department strongly objects to a provision that would make it easier to prosecute pimps, the chief slaveholders in the United States. The Justice Department opposes taking away from pimps the defense that they did not know a child’s age. And it opposes easing the requirement to prove force, fraud or coercion in order to prosecute a pimp for human trafficking.

How did President Bush’s Justice Department come to these positions? In conversations, department employees emphasize the threats of diversion of federal resources and intrusion on state and local rights.

But it is hard to believe these are the reasons. After all, the Justice Department knows that it will prosecute only the biggest pimps just as it goes after only the biggest drug dealers. It knows that pimping has long been recognized as an interstate activity with a federal role. And the Justice Department knows that the states have had very limited success when trying to convict traffickers.

A culture clash, I suspect, is the real reason for the Justice Department’s opposition. This isn’t the usual culture clash of right and left, religious and secular. In this case, the feminist, religious and secular groups that help sex-trafficking survivors are on one side. And on the other are the department’s lawyers (most of them male), the Erotic Service Providers Union and the American Civil Liberties Union — this side believes that vast numbers of women engage in prostitution as a “profession,” by choice.

As one Justice Department lawyer put it at a meeting I attended, there is “hard pimping and soft pimping.” The department’s letter hints at this view. Adult prostitutes who are transported across state lines, in violation of the Mann Act, should not receive grants under the Victims of Crime Act of 1984 because they “do not meet the legal definition of ‘victim,’” the letter states.

Both sides agree there is a small group of expensive call girls — the kind paraded in recent political scandals — who may choose to engage in prostitution. But that’s where agreement ends. Those who work with trafficking victims and those who have interviewed survivors believe that most prostitutes are poor, young, abused, harassed, raped, beaten and under the control of pimps against their will.

Put me on the side of those who have worked with the victims. I have talked with survivors all over the world, including the United States, and I share the view that these women and girls — the average age of entry into prostitution is 14 — are not participating in the “oldest profession” but in the oldest form of abuse. They are slaves.

It is hard to believe that the Justice Department’s perspective reflects the man at the top of the Bush administration. Yet the unusual anti-slavery coalition that President Bush helped to forge now finds itself battling the president’s own Justice Department.

The department lost the battle in the House, which passed the new anti-human trafficking bill almost unanimously, by a vote of 405 to 2. Unfortunately, the department seems to have more influence with the Senate, where the bill is stalled in the Judiciary Committee. And Senator Joseph R. Biden, Democrat of Delaware, has introduced a bill that largely complies with the department’s views.

The president may never have seen the Justice Department’s letter. But Representatives Carolyn Maloney, Democrat of New York, and Deborah Pryce, Republican of Ohio, two of the leaders of the Congressional Caucus on Human Trafficking, have been unable to arrange a meeting with the president to express their concerns to him.

President Bush should meet with them — and his own Justice Department — before he loses his legacy and his leadership on the abolition of modern slavery.
 

John R. Miller, a public policy scholar at the Woodrow Wilson Center and a senior fellow of the Discovery Institute, is the former State Department ambassador at large on modern slavery.

    The Justice Department, Blind to Slavery, NYT, 11.7.2008, http://www.nytimes.com/2008/07/11/opinion/11miller.html

Judge Rejects Bush’s View on Wiretaps

July 3, 2008
The New York Times
By ERIC LICHTBLAU

WASHINGTON — A federal judge in California said Wednesday that the wiretapping law established by Congress was the “exclusive” means for the president to eavesdrop on Americans, and he rejected the government’s claim that the president’s constitutional authority as commander in chief trumped that law.

The judge, Vaughn R. Walker, the chief judge for the Northern District of California, made his findings in a ruling on a lawsuit brought by an Oregon charity. The group says it has evidence of an illegal wiretap used against it by the National Security Agency under the secret surveillance program established by President Bush after the terrorist attacks of Sept. 11, 2001.

The Justice Department has tried for more than two years to kill the lawsuit, saying any surveillance of the charity or other entities was a “state secret” and citing the president’s constitutional power as commander in chief to order wiretaps without a warrant from a court under the agency’s program.

But Judge Walker, who was appointed to the bench by former President George Bush, rejected those central claims in his 56-page ruling. He said the rules for surveillance were clearly established by Congress in 1978 under the Foreign Intelligence Surveillance Act, which requires the government to get a warrant from a secret court.

“Congress appears clearly to have intended to — and did — establish the exclusive means for foreign intelligence activities to be conducted,” the judge wrote. “Whatever power the executive may otherwise have had in this regard, FISA limits the power of the executive branch to conduct such activities and it limits the executive branch’s authority to assert the state secrets privilege in response to challenges to the legality of its foreign intelligence surveillance activities.”

Judge Walker’s voice carries extra weight because all the lawsuits involving telephone companies that took part in the N.S.A. program have been consolidated and are being heard in his court.

Jon Eisenberg, a lawyer for Al-Haramain Islamic Foundation, the plaintiff in the case, said the legal issues Judge Walker’s ruling raised were significant. “He’s saying FISA makes the rules and the president is bound by those rules,” Mr. Eisenberg said.

A Justice Department official said the department was reviewing the opinion late Wednesday and would consider its options.

Officials at Al-Haramain say they were mistakenly given a government document revealing the N.S.A. operation. The Federal Bureau of Investigation demanded the document back, and Judge Walker’s ruling made it more difficult for Al-Haramain to use what it claims to have seen . But he refused to throw out the lawsuit, giving the charity’s lawyers 30 days to restructure their claim. “We still have our foot in the door,” Mr. Eisenberg said. “The clock is a minute to midnight, but we’ve been there before and survived.”

The ruling comes as the Senate is overhauling the foreign intelligence law. The measure would reaffirm FISA as the exclusive means for the president to order wiretaps through court warrants, but it would also provide legal immunity to phone companies involved in the eavesdropping program. A vote could come Tuesday.

The immunity issue would not directly affect this lawsuit because Al-Haramain is suing the government, not the phone companies. But the nearly 40 other lawsuits against phone companies that Judge Walker is overseeing would almost certainly have to be dismissed if immunity is signed into law, legal analysts say.

    Judge Rejects Bush’s View on Wiretaps, NYT, 3.7.2008, http://www.nytimes.com/2008/07/03/washington/03fisa.html

Justice Dept. Investigating Deportation to Syria

June 6, 2008
The New York Times
By SCOTT SHANE

WASHINGTON — The Justice Department’s ethics office is reviewing a decision in 2002 by department officials to send a Canadian citizen to Syria, where he was tortured, American officials said Thursday.

A Justice Department spokesman, Peter A. Carr, said that its inquiry, by the department’s Office of Professional Responsibility, was begun in March 2007 and was examining the role of department lawyers in expelling Maher Arar to Syria, which has long been identified by the State Department as habitually using torture on prisoners.

The existence of the Justice inquiry was disclosed at a Congressional hearing on Thursday by Richard L. Skinner, the inspector general of the Department of Homeland Security.

Mr. Skinner told two House subcommittees that the Arar case involved “very questionable” actions by United States government officials and that he “could not rule out” that Mr. Arar was sent to Syria with the intention of having him questioned under torture about possible connections to terrorists.

The testimony, along with a heavily redacted report of a separate investigation by Mr. Skinner, was the fullest accounting to date from the government on the case, which has become a symbol of American excesses in the campaign against terrorism. A film released last year, “Rendition,” was loosely based on the case.

Mr. Skinner also said his office had recently reopened its four-year inquiry into the Arar matter after receiving new information. He said that the new information was classified and that he could not discuss it.

Mr. Arar, a telecommunications engineer who had immigrated to Canada from his native Syria as a teenager, was detained in September 2002 as he tried to change planes at Kennedy International Airport. He had been flying back to Canada from Switzerland. Immigration officers found his name on a terrorist watch list.

After several days of deliberation that involved some high-level administration officials, according to one former White House aide, Mr. Arar was sent to Jordan by immigration officers and turned over to Syrian intelligence.

Mr. Arar, now in his mid-30s, was imprisoned for a year in Syria and beaten with a metal cable before being returned to Canada in 2003.

An exhaustive inquiry by a Canadian commission found that Canadian police and intelligence officials had provided inaccurate information to their American counterparts, erroneously linking Mr. Arar to Al Qaeda. Canadian officials apologized to Mr. Arar and awarded him about $10.3 million.

But the Bush administration has said almost nothing about the case and has continued to bar Mr. Arar from the United States, citing classified information. A Democratic congressman, Representative Jerrold Nadler of New York, said at the hearing that he had reviewed the secret information. “I think it’s nonsense,” he said.

Mr. Skinner’s investigation found that because Mr. Arar’s name was on a watch list, immigration officers properly declined to admit him into the United States, which was technically necessary for him to change planes.

But the investigation challenged the decision to send him to Syria, suggesting that he could have been sent on to Canada or returned to Switzerland, where his flight had originated.

The inspector general’s inquiry, which began in 2003, ran into resistance both inside the Department of Homeland Security and from other agencies, Mr. Skinner said, delaying its progress. He said his department initially sought to keep the entire report secret but agreed to his request to release most of it.

    Justice Dept. Investigating Deportation to Syria, NYT, 6.6.2008, http://www.nytimes.com/2008/06/06/world/middleeast/06arar.html

In Justice Shift,

Corporate Deals Replace Trials

April 9, 2008
The New York Times
By ERIC LICHTBLAU

WASHINGTON — In 2005, federal authorities concluded that a Monsanto consultant had visited the home of an Indonesian official and, with the approval of a senior company executive, handed over an envelope stuffed with hundred-dollar bills. The money was meant as a bribe to win looser environmental regulations for Monsanto’s cotton crops, according to a court document. Monsanto was also caught concealing the bribe with fake invoices.

A few years earlier, in the age of Enron, these kinds of charges would probably have resulted in a criminal indictment. Instead, Monsanto was allowed to pay $1 million and avoid criminal prosecution by entering into a monitoring agreement with the Justice Department.

In a major shift of policy, the Justice Department, once known for taking down giant corporations, including the accounting firm Arthur Andersen, has put off prosecuting more than 50 companies suspected of wrongdoing over the last three years.

Instead, many companies, from boutique outfits to immense corporations like American Express, have avoided the cost and stigma of defending themselves against criminal charges with a so-called deferred prosecution agreement, which allows the government to collect fines and appoint an outside monitor to impose internal reforms without going through a trial. In many cases, the name of the monitor and the details of the agreement are kept secret.

Deferred prosecutions have become a favorite tool of the Bush administration. But some legal experts now wonder if the policy shift has led companies, in particular financial institutions now under investigation for their roles in the subprime mortgage debacle, to test the limits of corporate anti-fraud laws.

Firms have readily agreed to the deferred prosecutions, said Vikramaditya S. Khanna, a law professor at the University of Michigan who has studied their use, because “clearly it avoids a bigger headache for them.”

Some lawyers suggest that companies may be willing to take more risks because they know that, if they are caught, the chances of getting a deferred prosecution are good. “Some companies may bear the risk” of legally questionable business practices if they believe they can cut a deal to defer their prosecution indefinitely, Mr. Khanna said.

Legal experts say the tactic may have sent the wrong signal to corporations — the promise, in effect, of a get-out-of-jail-free card. The growing use of deferred prosecutions also suggests one road map the Justice Department might follow in the subprime mortgage investigations.

Deferred prosecution agreements, or D.P.A.’s, have become controversial because of a medical supply company’s agreement to pay up to $52 million to the consulting firm of John Ashcroft, the former attorney general, as an outside monitor to avoid criminal prosecution. That agreement has prompted Congressional inquiries and calls for stricter guidelines.

Defenders of deferred prosecutions say that they have been too harshly criticized lately and that they play a crucial role in allowing the government to secure the cooperation of a company while avoiding the time, expense and uncertainty of a trial. The agreements, government officials say, also avoid the type of companywide havoc seen most acutely in the case of Arthur Andersen, the accounting firm that was shuttered in 2002 after being indicted in the Enron scandal. The firm’s collapse threw 28,000 employees out of work.

At a Congressional hearing last month, Mr. Ashcroft defended the agreements, saying that they avoided “destroying entire corporations” through criminal indictments. “Prosecutors understand that a corporate indictment can be a corporate death sentence,” he said. “A deferred prosecution can avoid the catastrophic collateral consequences and costs that are associated with corporate conviction.”

Paul J. McNulty, a former deputy attorney general who put new guidelines in place in 2006 for corporate investigations at the Justice Department, said in an interview, “There’s a fundamental misapprehension with D.P.A.’s to think that they’re a break for the company.”

With the imposition of fines and an outside monitor, “the reality is that for the government, it gets pretty much everything without the difficulty of going forward with an indictment,” said Mr. McNulty, who is now in private practice. “I think companies are beginning to wonder whether they ought to fight more, because they are pretty burdensome.”

But critics of the agreements question that assertion. Charles Intriago, a former federal prosecutor in Miami who specializes in money-laundering issues, said that huge penalties, like the $65 million fine for American Express Bank International in 2007, were “peanuts” compared with the damage posed by a criminal conviction. The company was accused of failing to enact internal controls to guard against laundering of drug money and other reporting problems.

The agreements were once rare, but their use has skyrocketed in the current administration, with 35 deals last year alone by the Justice Department, lawyers who follow the trend said. Banks, financial service companies and auditors have frequently entered into such agreements, including recent ones involving Merrill Lynch, the Bank of New York, AmSouth Bank, KPMG and others. Beyond financial crimes, deferred agreements have been used in lieu of prosecuting companies — though not individuals — for export control violations, obscenity violations, Medicare and Medicaid fraud, kickbacks and environmental violations.

In general, such agreements result in companies acknowledging wrongdoing by not contesting criminal charges, but without formally admitting guilt. Most agreements end after two or three years with the charges permanently dismissed.

Monsanto, for example, while not admitting guilt, agreed to abstain from further violations of bribery laws. In an e-mail message, Lori Fisher, a spokeswoman, said that Monsanto had cooperated with the Justice Department and fully complied with the agreement, leading to deferred charges being permanently dismissed in early March.

The trend has led to increased speculation about how the Justice Department might use the agreements in investigations against financial companies in the mortgage lending scandal, which has become a top law enforcement priority for the department as the economy has withered.

The Federal Bureau of Investigation has 17 open inquiries into accusations of corporate fraud in connection with the subprime scandal, and Neil Power, who leads the bureau’s economics crime unit, said in an interview that the number was certain to grow. The F.B.I. has publicly identified only one target — the Doral Financial Corporation, a mortgage company based in Puerto Rico whose former treasurer has already been indicted — but major companies like Countrywide Financial, once the nation’s biggest mortgage lender, have also been reported to be under criminal investigation.

Mr. Power said the investigations were a reflection of the “environment of greed” that allowed companies to package mortgages into securities they sold to investors without sufficient documentation of the borrower’s ability to repay. One line of criminal inquiry focuses on whether bond companies gave accurate information to investors.

“What we’re looking at,” he said, “is the fact that they may be performing accounting fraud.”

Justice Department officials would not discuss the role that deferred prosecution agreements may play in their ultimate handling of the mortgage investigations. One official said it was “way too early” to begin speculating about such possibilities.

But the prospect already has some experts in the field worried.

Michael McDonald, a former Internal Revenue Service investigator in Miami who is a private consultant and has given seminars on deferred prosecutions, said such deals “should not be on the board” in the subprime mortgage investigations.

“In light of what this did to our economy, people shouldn’t just be able to write a check and walk away,” Mr. McDonald said. “People should be prosecuted for it and go to jail.”

Timothy Dickinson, a lawyer in Washington who was the outside monitor for Monsanto, agreed. Corporate lenders caught up in the mortgage scandals should not assume they will be given the chance for a deferred prosecution, Mr. Dickinson said, and the Justice Department should “insist on a guilty plea” rather than offering a deal.

“It’s a tool that will remain to be used by prosecutors in appropriate circumstances, but not every circumstance,” he said. “It depends how egregious the conduct is.”

    In Justice Shift, Corporate Deals Replace Trials, NYT, 9.4.2008, http://www.nytimes.com/2008/04/09/washington/09justice.html

Court Overturns Tobacco Suit Ruling

April 3, 2008
The New York Times
By THE ASSOCIATED PRESS

An appeals court has overturned class-action status for a lawsuit seeking $200 billion from tobacco companies for suggesting that light cigarettes might be less harmful than regular cigarettes.

The decision is a win for defendants including the Marlboro maker Philip Morris USA, its biggest American rival, the R. J. Reynolds Tobacco Company and other manufacturers. The companies prefer trying each case on its own, saying circumstances for each smoker vary widely.

The decision Thursday by the United States Court of Appeals for the Second Circuit in Manhattan overturns a decision by a Brooklyn judge. That lawsuit has sought a large payout on behalf of tens of millions of smokers.

A message left with a lawyer for the smokers was not immediately returned.

In September 2006, Judge Jack B. Weinstein of United States District Court in Brooklyn ruled that class-action status would allow the suit to go forward on behalf of all light cigarette smokers in the nation.

The suit argued that tobacco companies defrauded smokers into thinking light cigarettes were safer than regular cigarettes. Lawyers for the smokers argued that lights cigarettes brought tobacco companies between $120 billion and $200 billion in extra sales. The case was first filed in 2004 against Philip Morris USA, R. J. Reynolds Tobacco, British American Tobacco, Liggett Group, Brown & Williamson and Lorillard Tobacco. It differs from many previous tobacco lawsuits in that it does not claim that smokers suffered personal injury. Instead, the case — called the Schwab case after the lead plaintiff, Barbara Schwab — claimed that the industry defrauded consumers beginning as early as 1971, when Philip Morris began selling Marlboro Lights, the first light cigarette.

Because some 45 percent of smokers currently smoke light cigarettes, potentially vast numbers of people nationwide could be involved.

    Court Overturns Tobacco Suit Ruling, NYT, 3.4.2008, http://www.nytimes.com/2008/04/03/business/aptobacco-web.html