The wrong arm of the law

A new book reveals how US federal prosecutors twist the law tocriminalise legal activities, with connivence from the media

Dan Kennedy

guardian.co.uk, Tuesday 17 November 2009 19.30 GMT

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Sharp-elbowed business executives and grasping politicians may not be especially popular figures within the American iconography. But membership in either of thoseclasses is not a federal crime.Except when it is.In an important new book, Three Felonies a Day: How the Feds Target the Innocent,Boston civil-rights lawyer Harvey Silverglate argues that over the past several decadesthe federal government, relying on vague, dangerously elastic statutes, has criminaliseda whole range of activities. The result, Silverglate contends, is that people are regularly sent to prison for crimes they hadn't even known they'd committed."Wrongful prosecution of innocent conduct that is twisted into a felony charge has wrecked many an innocent life and career. Whole families have been devastated, ashave myriad relationships and entire companies," writes Silverglate, a friend as well asan occasional collaborator.Skeptical? Consider three prominent cases ripped from recent headlines:

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Jurors in a federal courthouse in Brooklyn, New York, took just nine hours to acquitBear Stearns hedge-fund managers Ralph Cioffi and Matthew Tannin of conspiracy andfraud charges related to the collapse of two hedge funds, a disaster that wiped out $1.6 billion in assets. It seems there was a problem: "It wasn't clear that there was a crime,"Peter Henning, a professor at Wayne State University Law School, told Bloomberg. Oh,that. Well, never mind, and double jeopardy be damned. Prosecutors now say they'll bring a wire-fraud charge against the two.

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The latest poster boy for financial shenanigans is Raj Rajaratnam, who manages ahedge fund called Galleon Group and who's been charged with insider trading.Rajaratnam actually lost money on those trades, which makes him either comically inept or innocent. The latter might be a good bet. As the New York Times put it: "MrRajaratnam and Galleon trade assets rapidly, gather information rapaciously and focuson short-term gains. But those tactics are not illegal."

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Sal DiMasi, a former speaker of the Massachusetts House of Representatives, isfighting a federal indictment related to political favors he received on the grounds thatthe federal "honest services fraud" law he's accused of violating is "unconstitutionally vague", according to the Boston Globe. (Silverglate notes that no less an authority thansupreme-court justice Antonin Scalia has worried that the "honest services" law could be used to criminalise just about anything, right down to "a mayor's attempt to use theprestige of his office to obtain a restaurant table without a reservation.") First, though,DiMasi must hang on to his lawyer: the feds have reportedly tried to deny DiMasi the

The wrong arm of the law | Dan Kennedy | Comment is free | guardian.co.ukhttp://www.guardian.co.uk/commentisfree/cifamerica/2009/nov/17/silverg...1 of 211/23/2009 4:13 PM