White House Comes Out Against Effort To Block White-Collar Crime Prosecutions

Sweeping changes would affect food safety, the environment and violent crime.
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The White House is not happy about language on corporate crime that the House Judiciary Committee approved on Wednesday as part of a bipartisan criminal justice reform package. The legislation would eliminate a host of white-collar crimes involving gross negligence or reckless behavior by forcing prosecutors to prove that defendants knew they were breaking specific laws when engaging in obviously illegal activity.

The Department of Justice, the American Bar Association, the Center for American Progress and the Leadership Conference on Civil and Human Rights have all raised concerns about the legislation. The broad scope of the legislative language also appears to have implications beyond the corporate world. The Obama administration lit into the bill late Wednesday.

"If the bill became law, a terrorist could only be found guilty for using a weapon of mass destruction if he specifically knew his victims were going to be U.S. nationals, a killer could only be found guilty of certain firearm crimes if he knew the gun traveled in interstate commerce, and a white-collar criminal could only be found guilty of bank fraud if he knew he was robbing a bank that was FDIC-insured," a White House official said in a statement provided to The Huffington Post. "In the President's view, criminal justice reform should only make the system better, not worse."

Until Wednesday, criminal justice reform had been focused on alleviating mass incarceration by reducing severe sentences for nonviolent drug crimes. But a host of high-profile conservative groups including the Koch brothers, the Heritage Foundation and the Manhattan Institute have been advocating for action on white-collar crime.

The activist group Occupy The SEC organized a petition urging Congress to reject the measure, saying it "would serve as a Get Out of Jail Free card for white collar criminals."

"Federal prosecutors already face grave difficulty is proving intent for corporate misdeeds because culpable criminal conduct is often hidden deep within the corporate veil, underneath layers of management, boards and bureaucracy," the petition reads. The bill "would make it even more difficult for prosecutors to punish white collar crime. And criminals would be emboldened to take further advantage of shareholders, employees, consumers, and the public."

The bill was introduced by Rep. Jim Sensenbrenner (R-Wis.), and is co-sponsored by Reps. Bob Goodlatte (R-Va.), John Conyers (D-Mich.) and Sheila Jackson Lee (D-Texas). At the Judiciary Committee mark-up hearing for the bill, Conyers said it would curb prosecutions for food safety violations and environmental degradation cases. Lee said it would prevent a farmer who had received a third-party seal of food safety approval from being prosecuted if their food made people sick.

The White House official said the bill "would undermine public health and safety, including laws that protect our environment and ensure food and drug safety."

"Moreover, the bill would cause massive confusion and uncertainty in the law, and enable defendants charged with a range of offenses – including violent crimes, terrorism, and sexual offenses – to potentially escape liability for egregious and harmful conduct," the official said.

The official also urged the House to adopt measures that "would give prisoners the tools and incentives they need to turn their lives around and juvenile offenders in the federal system the second chance they deserve," which have received bipartisan support in the Senate.

Zach Carter is The Huffington Post's senior political economy reporter and a co-host of the HuffPost Politics podcast "So That Happened." Listen to the latest episode:

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