Corporate Immigration Enforcement

Yesterday, the Wash. Post reported on a decline in corporate immigration enforcement, citing to the Duke / UVA Registry.

“Prosecuting corporations, as opposed to individual workers or managers, for immigration-related offenses was also relatively rare during the Obama administration, but it has slowed further under the Trump administration, according to a database maintained by Duke University and the University of Virginia and data reviewed by The Washington Post.

The Corporate Prosecution Registry tracks cases in which companies, rather than individuals, are charged with violating federal law, and it includes cases resolved with plea agreements as well as deferred and non-prosecution agreements.”

“There were at least 88 such cases against companies for immigration violations between 2009 and 2016 during the Obama administration and at least five companies prosecuted for immigration violations since Trump took office in 2017, according to the data on corporate prosecutions and a review of news releases from U.S. Immigration and Customs Enforcement.”

Declining Corporate Prosecutions

A new article, forthcoming in the American Criminal Law Review, develops new data from the last two years of the Duke / UVA Corporate Crime Registry. It is now available on SSRN here. A description of the findings:

Two years into the Trump Administration, newly collected data allows one to assess what impact a series of new policies have had on corporate enforcement.  To provide a snapshot comparison, in its last 20 months, the Obama Administration levied $14.15 billion in total corporate penalties—with 71 financial institutions and 34 public companies prosecuted.  During the Trump Administration, corporate penalties declined.  During its first 20 months, there were $3.4 billion in total penalties, with 17 financial institutions and 13 public companies prosecuted.  These trends build over time—in each year, blockbuster cases come and go, creating swings in fines.  However, consistent with these data, this Article describes changes in written policy, practice, and informal statements from the Department of Justice that have cumulatively softened the federal approach to corporate criminals. 

This figure illustrates the changes in corporate penalties:

Corporate Criminal Penalties, 2001-2018

This Article also describes continuity between administrations.  A rise in corporate declinations, for example, represents a continuation of Obama Administration policy. A decline in use of corporate monitors similarly reflects prior policy. The steady and low level of individual charging in corporate cases, reflects an ongoing lack of success of efforts to prioritize individual prosecutions, exemplified by the 2015 “Yates Memo.”  The figure below illustrates these findings:

Individual Prosecutions Accompanying Deferred and Non-prosecution agreements, 2001-2018

That policy, like others, has now been formally relaxed. This series of DOJ corporate prosecution policy changes have been accompanied by important institutional shifts.  For example, high-level vacancies within the DOJ and other enforcement agencies may compromise ability to coordinate resolution of complex cases.  This Article concludes by proposing structural changes, such as an independent corporate enforcement functions, to enhance capacity and prevent pendulum shifts in the administration of enforcement.  

Ending Too Big to Jail Act

This week, Sen. Elizabeth Warren re-introduced an “Ending Too Big to Jail Act.” Portions of the legislation deal with new resources for corporate criminal investigations at the Department of Justice. For a discussion of the legislation, and my comments on the need for resources to bring highly complex corporate investigations, see this story at Vox. That coverage discusses examples concerning settlements with large corporations post-financial crisis – and we encourage readers to browse this Registry to learn more about such settlements!

Beyond Hard Time

Read more here, for an op-ed in The New Republic on what the disparate reactions to Manafort’s sentence and California’s death penalty ban reveal about our criminal justice system:

For many years, the justice system has allowed serious corporate corruption to go unpunished, banks to be prosecuted repeatedly for the same crimes, and corporations and executives to get deferred prosecutions and below-the-guideline sentencing. This system of pronounced judicial leniency has created a punishment model for many corporate offenders that I call “too big to jail”—and in recent years, matters have gotten worse. Even within this already skewed and top-heavy system, I have documented declining corporate penalties under the Trump administration. Ending “too big to jail,” however, doesn’t mean passing tougher sentences for white-collar crimes. After all, Congress has created plenty of tough new white-collar offenses since the 2001 Enron scandal—and, for the most part, these new tools have sat on the shelf untouched by prosecutors.

Instead of enacting more draconian sentences, we must invest in white-collar law enforcement the same way we invest in other measures to protect public safety. Consider this: the Internal Revenue Service has had its budget cut over the past decade to the point where audits have decreased by 42 percent and the number of tax fraud cases the agency brings has been cut by nearly 25 percent. Under such lax enforcement, tax fraud schemes—of the very sort repeatedly carried out by Paul Manafort—are able to thrive…

The way out of the double standard we apply to punishment is to reject the notion that true justice inheres in strictly hewing to a one-size-fits-all model of criminal sentencing. 

Duke/UVA Registry Data in the N.Y.Times

Read more here about how the New York Times calculated enforcement numbers during the first twenty months of the Trump Administration. They explain:

“The Times asked the Legal Data Lab at the University of Virginia School of Law and Duke Law School, which maintains a registry of corporate criminal prosecutions, to analyze all such cases filed in the first 20 months of the Trump administration and compare them with those filed in the first and last 20 months of the Obama White House. The analysis reflects sums paid to federal prosecutions, whether in fines, restitution or forfeiture. It does not reflect sums paid to civil regulators or state or foreign enforcers.”

New Entries to the Registry

The Corporate Prosecution Registry has been updated with the following new entries/agreements (added Jan. 9, 2018):

Deferred Prosecution

Georgeson, LLC (2017-11-30)
Keppel Offshore & Marine Ltd. (2017-12-22)

Non-Prosecution

Manafort Brothers, Inc. (2014-04-07)
Netcracker Technology Corp. (2017-12-06)
RBS Securities (2017-10-25)

Plea

Allied Refrigeration (2013-05-16)
AOC-DME (2017-04-11)
Beam Brothers Holding Corp., LLC (2017-12-11)
Beam Brothers Trucking Co. (2017-12-11)
Fraticelli Trucking Company, Inc. (2017-07-12)
George K. Reese Professional Chiropractic Corp. (2017-05-05)
ISF Trading (2017-06-29)
Keppel Offshore & Marine USA, Inc. (2017-12-22)
Neuroscience, Inc. (2017-03-28)
Zaappaaz, Inc. (2017-12-08)

New Entries to the Registry

The Corporate Prosecution Registry has been updated with the following new entries (added Oct. 19, 2017):

Acquittals

Nippon Paper Industries Co., Ltd.
Stora Enso North America Corp.
W.R. Grace

Dismissals

Tyson Foods, Inc.

Plea Agreements

Alden Leeds, Inc.
Asplundh Tree Experts, Co.
Willmax Capital Management, Inc

Trial Convictions

Arthur Andersen, LLP
Mitsubishi Corp.
San Diego Gas & Electric Co.

Please note that we are still working on summarizing the data in these documents and the spreadsheets available for download will be updated at a later time.

New Entries to the Registry

The Corporate Prosecution Registry has been updated with the following new entries (added Oct. 10, 2017):

Prosecution Agreements

Aegerion Pharmaceuticals
Rolls-Royce

Plea Agreements

Aireko Construction Company
AmerisourceBergen Specialty Group 
Bumble Bee Foods LLC
Ciner Gemi Acente Isletni Sanayi Ve Ticaret S.A
Custom Wristbands Inc.
DB Group Services (UK) Limited
Egyptian Tanker Company
Kiekert AG
MAB Environmental Services, Inc.
Princess Cruise Lines, LTD
Scientic, Inc.
SCM True Air Technologies, Inc.
SCP Management
Takata Corp.
The Public Warehousing Company
Thome Ship Management
Young Living Essential Oils, L.C.
Yuh Fa Fishery (Vanuatu) Co. Ltd.
Zambelli Fireworks Manufacturing Company, Inc.

Trial Convictions

Black Elk Energy Offshore Operations LLC
Oceanfleet Shipping Ltd
Oceanic ILLSABE Ltd

Please note that we are still working on summarizing the data in these documents and the spreadsheets available for download will be updated at a later time.

New Entries to the Registry

The Corporate Prosecution Registry has been updated with the following new entries (added Sep. 25, 2017):

Prosecution Agreements

Telia Company AB

Please note that we are still working on summarizing the data in these documents and the spreadsheets available for download will be updated at a later time.