Executive Summary
The demise of the legal person Arthur Andersen LLC models the man y miscarriages of justice, wrongful convictions and subsequent exonerations of real persons. The case shines a bright light into corners of the criminal justice system often ignored both by the mass media as well as by many criminal justice professionals. The exuberance of enforcement authorities, ambitions of prosecutors, prejudices of the judge, witnesses who recant, limitations of the jury and crusades by outsiders were capped by an overturned conviction and an order for a new trial that did the defendant little good. Like a man in prison who has suffered a stroke, and who cannot therefore participate in his court-ordered new trial, Arthur Andersen LLC exists today only as a shell. Entities spun off from it are orphans who distanced themselves from their disgraced parent by changing their names.
This portfolio provides a cross-section of the case, revealing its elements, though without the depth they deserve. A book might not be enough. Two have been written specifically about the Arthur Andersen case.Many more – 50 to 100 – have been written about Arthur Andersen‟s infamous client, Enron.Specifically because the two are so tightly bound in popular perception, it is important to separate them. They had different origins, histories, and cultures. Both had tens of thousands of employees.That their employees (as well as partners and officers) shared vices and virtues is not meaningful. Broad condemnations of “corporate greed” are as prejudiced as the equally easy and fallacious claim that African Americans have a “culture of violence” as
evidenced by the many news stories about violence in the African American community and the disproportionate incarceration rate. Examining the facts in the case of The United States versus Arthur Andersen LLC reveals that this was a miscarriage of justice.
Nothing else matters.
Finally, a tension exists between “street crime” and “suite crime.” Our common assumptions about crime begin with interpersonal assaults. This is historic; and it crosses cultures. Specificity of cultural context notwithstanding, harms come when one person trespasses against another – and you know it when you see it. Much about white collar crime has analogs to other kinds. A victim and a perpetrator must exist. A law must be broken. Arrest and trial are the expected outcome – and plea-bargaining is common. That said, the highly abstracted nature of the modern administrative regulation of businesses is different than common law. First of all, few regulations begin as legislation. Most are made by administrative bodies, in this case, the Securities and
Exchange Commission – which is empowered by Congress to make such rules and to
have them enforced as laws. These strictures are often arcane, difficult to understand,
cumbersome to obey and challenging to enforce. The first consideration is that “a corporation can be both the perpetrator and the victim of a single course of criminal conduct. In such cases, the criminal law may describe the corporation as either the culpable defendant or the innocent victim. Both characterizations can be correct as a matter of law (Michaels).” This specific point troubled the jury in the Arthur Anderson case. In the middle of their deliberations, they queried the judge on this point – and the judge excused herself to consider it. This was abstruse law.
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