Financial crime is becoming harder to prove in the United States

Few people have even an approximate idea of what financial crime is and what it represents. While the very complex processes it uses, which are, for it, like second nature, rightly confuse the layman, money powers, politicians and the media are successfully working to minimize their importance. Periodically, some resounding scandals break out, whose mechanisms and ramifications are rarely highlighted. Put on a show, they momentarily make the news, are denounced as excesses or inevitable anomalies in the generally regular world of business and they soon find the protective shadow they should not have left, Without any chance of being able to connect the pieces of the puzzle presented to them, public opinion ultimately feels little concerned by practices far removed from its areas of interest.

However, nothing could be less certain. Financial crime is now one of the main threats to public order, the security of economic transactions and the value system that serves as a reference for Western democracies.

Also referred to as “white-collar crime” or “business crime” – or even more nicely, as “clever crime” by the judicial police, a form of tribute to vice by virtue, – financial crime covers all the processes used in business life to illicitly steal the money of others: the State, consumers, employees, shareholders, competitors, client companies or suppliers?

These processes are often inextricably linked, in the most diverse forms, in all sectors of activity: abuse of corporate assets, presentation of false balance sheets, accounting falsifications, forgery, fictitious transactions and companies, false invoices, illegal agreements and price manipulation, obstacles to the freedom of auctions, etc.

PINNING WHITE-COLAR OFFENDERS MORE THAN EVER A CHALLENGE

Pinning white-collar offenders will become even more difficult for American prosecutors. Navigating the mysteries of the corporate world to prove the misdeeds of crooked executives was already no small feat. But the US Supreme Court has just complicated matters by interpreting more strictly the law that sent Jeffrey Skilling, former Enron boss, and Conrad Black, former boss of the Hollinger media group, to prison.

The highest American court has in fact restricted the notion of “honest services”, which is very often used to denounce the actions of certain employees towards their employer. The Court considered that this law had been heard in too broad a sense, and stated that it should only be invoked in the event of proven retrocommissions or bribes.

This decision would drop some of the charges against Mr. Skilling and Mr. Black, without necessarily leading to their release. The Supreme Court referred the case to lower-ranking courts, and the two men were not imprisoned solely on the basis of the notion of “honest services”. But this decision does not facilitate the fight against white-collar crime. Financial crime is by nature difficult to prove. The way companies operate, their accounts and governance can be complex. Some time ago, just after the crisis, individuals were put in the spotlight, including two hedge fund managers from Bear Stearns Bank. They were cleared in 2009.

In fact, just as those who were chasing Al Capone eventually caught him through tax evasion, the few rare victories in financial crime cases have resulted more than once in convicting defendants for covering up the crimes rather than participating in them.

EFFECTS THAT ARE DIFFICULT TO ASSESS

To make matters worse, senior managers often overflow the justice system with the significant financial resources they can devote to legal fees.

The effects of the Supreme Court’s decision in Skilling and Black are still difficult to assess, but what is certain is that even good faith prosecutors have lost some leeway. Many good people are still hoping that bank bosses will pay for causing the financial crisis. A chimera that is better to give up.

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