Corporate Felony Charges Coming.
On March 31st, CNBC reported on Manhattan U.S. Attorney Preet Bharara’s assertion that the government has gone too easy on corporations in recent years, and that corporate felony charges could be in the offing. Invoking prosecutors’ widespread hesitancy to file criminal charges, Bharara says that after Arthur Andersen went out of business following an indictment in 2002, the pendulum has swung too far toward a presumption of prosecutorial immunity on the part of corporations. “You can expect before too long a significant financial institution will be charged with a felony or made to plead guilty to a felony where the conduct warrants it,” said Bharara at the Securities Industry and Financial Markets Association annual compliance and legal society seminar on March 31. Wall Street firms have been emphasizing the terrible consequences - drops in stock prices or departure of executives - that would result from tough sanctions, but Bharara has found that typically “the sky does not fall… And so, this repeated chicken little routine … begins to wear thin.” Only time will tell whether such pointed rhetoric will actually result in more prosecutions.