Wednesday, December 3, 2008

With new US Attorney, it's a good time to be a white-collar criminal in San Diego

Voice of San Diego
Without Lam, U.S. Attorney's Office Takes Different Tack
Dec. 2, 2008

..."There's been a precipitous decline in white-collar investigations and prosecutions over the last two years," said Michael Attanasio...

[Carole] Lam's tenure turned out to be glory days for the FBI's financial crime squads, for federal prosecutors working major frauds and for dream-team defense attorneys whose clients made headlines around the country.

When Karen Hewitt took over 22 months ago, controversy raged over what was perceived by some as politically motivated firings of Lam and seven other U.S. attorneys around the country...

Lam, a healthcare fraud specialist, had branded herself a champion of these high-impact corporate and public corruption cases. As for border crime, she bypassed the small players and went after leaders of large drug- and human-smuggling rings and corrupt border officials.

[Blogger's note: good call, Carole.]

...Criminal prosecutions in fiscal 2008, Hewitt's first full year in office, have increased 54 percent since Carol Lam's first year in office, fiscal 2003, according to the Transactional Records Access Clearinghouse, which monitors federal prosecution statistics. Comparing the same five-year period, immigration cases in the Southern District of California are up 88 percent.

[Blogger's note: The higher the prosecution rate, the more likely it is than innocent people are being charged. I'll bet the conviction rate has gone down for those who are brought to trial. I'll also bet that not many cases actually go to trial. If Hewitt charges everybody who gets scooped up by over-eager agents, then underpaid public defenders can't afford to defend them properly, and advise even their innocent clients to accept plea-bargains.]

Also during that span, prosecutions of white-collar cases referred by the San Diego FBI are down 74 percent, from 78 cases in 2003 to 18 cases in 2008, the lowest level in two decades. And public corruption cases are down 71 percent, from seven cases to two. Under Lam, the number of such cases had reached the highest levels in two decades, hitting 12 in 2004, TRAC found.

"She's very aware of the reasons her predecessor was axed," criminal defense attorney Bob Rose said of Hewitt. "I really doubt she would like that to happen to her."

...until a few weeks ago, the major frauds unit was at its lowest staffing levels in years -- a decline that began toward the end of Lam's 4.5-year tenure as resources dwindled. Four junior attorneys were assigned to the unit recently, bringing the number to about 11, lawyers in the office said. That appears to be in step with a national trend to crackdown on mortgage fraud and other financial crimes associated with the nation's economic meltdown.

Hewitt's office declined to provide statistics or answer questions, but said from 2007 to 2008, immigration cases were up 48 percent, gun cases were up 17 percent, child pornography cases were up 60 percent, and frauds were up 71 percent. Hewitt was interim U.S. attorney for eight months of fiscal 2007...

Former FBI chief Bill Gore, now the undersheriff, raved about Hewitt while introducing her as speaker at a Rotary Club meeting in October, calling her a "team player."

...the vast majority of cases prosecuted by Hewitt's troops comes from Customs and Border Protection (73 percent) and Immigration and Customs Enforcement (17 percent), both part of the Department of Homeland Security. Only about 2 percent of the U.S. attorney's cases are referrals for prosecution by the San Diego FBI, according to TRAC, which analyzes Justice Department data...

The federal government reported filing 151 criminal mortgage fraud prosecutions in the first 10 months of FY 2008, 10 of which are in the Southern District of California, which includes San Diego and Imperial counties, according to data obtained by TRAC.

The 151 federal mortgage fraud prosecutions so far reported for fiscal 2008 were clustered in only 10 judicial districts, with Florida South (Miami) the most active with 69 cases, followed by Western Pennsylvania (Pittsburgh) with 26 prosecutions. San Diego was tied for third with 10, sharing that distinction with Northern Georgia.

In its analysis of the data, the TRAC report said: "Given the broad troubles now confronting the economy of the United States, and the role that mortgage fraud may have played in these problems, the relatively small number of cases in this area is somewhat surprising. For example, during the same period U.S. attorney offices criminally prosecuted 554 individuals for simple drug possession, 399 cases for environmental wildlife protection and 405 for child pornography."

...Hewitt, a Republican and avid sports fan, joined the San Diego U.S. Attorney's Office in 2000 and prosecuted civil fraud cases before Lam appointed her as third in command -- executive assistant U.S. attorney -- in 2006...

With the election of Democrat Barack Obama to the White House, Hewitt almost certainly will be stepping down, and priorities are likely to shift again with the unnamed new appointee. The position is a political appointment, and incoming presidents typically choose their own U.S. attorneys. But that process could take up to a year.

[Blogger's note: Unfortunately, Democrats often let big fish get away, just like Republicans. I would like to see the appointment of Eliot Spitzer or someone with equal courage to go after the criminals in insurance companies. And I'd like to see the US Dept of Justice do something more important than going after prostitutes.]

Hewitt apparently prefers to put little guys in jail, burdening the taxpayers and contributing the United States reputation as having the highest percentage of incarcerated population in the world. It's not hard to get someone to plead guilty when their exhausted lawyer doesn't have time to work on the case. You end up with lots of guilty pleas, often from innocent people who fear more years in jail if they don't plead guilty.]

...the additional cases under Hewitt have had a significant impact on workload for the U.S. District Court, the clerk's office, court-appointed defense lawyers and the jails and prisons.

Federal Defenders of San Diego Inc. has been forced to increase the number of staff lawyers by 25 percent in the last year to handle the caseload. "There've been points in the year when everybody's been just absolutely under water," said Reuben C. Cahn, executive director. "Everyone can work 80 hours a week for a couple months at a time but they just can't do it longer than that without the quality of work eroding or without burning out. It's been a very difficult year for us."

Cahn said the numbers tell the story. His office handled 892 immigration cases in FY 2006, then 1,240 in 2007 when Hewitt first took over, and 1,660 in 2008. "That's essentially doubled in two years," he said.

So, the prominent white-collar defense lawyers are doing a lot of civil cases now. There have been no new high-profile corruption cases like Cunningham, who is serving more than eight years in prison.

An Office of the Inspector General report has concluded that Lam's firing, while mishandled, did not appear to be an effort by the Bush Administration to derail Lam's pursuit of Cunningham and spinoff cases targeting GOP colleagues. Her firing was about failing to prosecute border crimes, a Justice Department priority, the report said...

[Blogger's note: There's obviously no need for meddling. The Bush Administration hired Hewitt because they were confident she would do exactly what they wanted.]

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