The calculus of confession: When negotiated settlements replace punitive justice in prosecuting fraud

“ In this connection the reader will recall the attitude of the inhabitants of Lilliput as chronicled by Gulliver.—"They look upon fraud as a greater crime than theft, and therefore seldom fail to punish it with death; for they allege that care and vigilance, with a very common understanding, may preserve a man's goods from theft, but honesty has no defence against superior cunning; ... the honest dealer is always undone, and the knave gets the advantage. ”

“ They look upon fraud as a greater crime than theft, and therefore seldom fail to punish it with death; for they allege, that care and vigilance, with a very common understanding, may preserve a man’s goods from thieves, but honesty has no defence against superior cunning; and, since it is necessary that there should be a perpetual intercourse of buying and selling, and dealing upon credit, where fraud is permitted and connived at, or has no law to punish it, the honest dealer is always undone, and the knave gets the advantage. ”

“ This offence, my Lord, does not proceed from the infirmity of a noble mind, from the impetuosity of youthful passion, from the excess of any generous feeling;—it is cold, calculating fraud, scarcely capable of aggravation; but, if it be capable of aggravation, it has received this great aggravation, that when threatened with detection, he endeavoured to avert it by the deliberate commission of a crime which, I repeat, has all the moral turpitude of Perjury, without its legal responsibility. ”

“ If you only notice human proceedings, you may observe that all who attain great power and riches, make use of either force or fraud; and what they have acquired either by deceit or violence, in order to conceal the disgraceful methods of attainment, they endeavor to sanctify with the false title of honest gains. Those who either from imprudence or want of sagacity avoid doing so, are always overwhelmed with servitude and poverty; for faithful servants are always servants, and honest men are always poor; ”

“ The US Department of Justice does not have the person power to pursue enough criminal securities cases in the Internet Age. Commission attorneys have the expertise, but not the legal right, to bring criminal prosecution. The afore-described waiver system only makes the fraudsters more confident that the potential gain from fraud outweighs the risk. ”

“ Still, however, the inconvenience and delay of prosecution in our courts are so great, and the chance of the ultimate conviction of great offenders is so small, that strong temptations are held out to the police to conceal or misrepresent the character of crimes; and they must have a great feeling of security in their tenure of office, and more adequate salaries, better chances of rising, and better supervision over them, before they will resist such temptation. ”

“ An inscription on the walls of the Department of Justice states the proposition candidly for the federal domain: 'The United States wins its point whenever justice is done its citizens in the courts.' [2] A prosecution that withholds evidence on demand of an accused which, if made available, would tend to exculpate him or reduce the penalty helps shape a trial that bears heavily on the defendant. ”

“ Every person prosecuted for crime, as a part of the strategy of defeating conviction, wants civil actions brought against him, and oftentimes wants to confess them or settle them in order to plead that he has squared his accounts with the law.
Moreover, we know that the assets of men engaged in criminal activities are rarely equal to the discharge of their obligations and in that event by sharing the available assets with an informer, the Government's financial recovery is diminished. ”

“ But when a promise is made with no intention of performance, and for the very purpose of accomplishing a fraud, it is a most apt and effectual means to that end, and the victim has a remedy by action or defence. Such are cases of concealed insolvency and purchases of goods with no intention to pay for them. ”

“ Some victims are reluctant to come forth, because they believe that police and prosecutors are not computer-literate, and can and will do nothing. Others are embarrassed by their vulnerabilities, and will take strong measures to avoid any publicity; this is especially true of banks, who fear a loss of investor confidence should an embezzlement-case or wire-fraud surface. And some victims are so helplessly confused by their own high technology that they never even realize that a crime has occurred—even when they have been fleeced to the bone. ”

“ When the accusations are disbelieved and dismissed as not worthy of attention, the crime becomes unfrequent, ceases to occupy the public mind, and affords little trouble to the judges. That [Pg 86] where the times have not been so violent and superstitious but that sensible men might venture to speak freely, and the accused could have a fair trial, they have usually discovered cheat and imposture. Fifteen famous detections of fraud were made, many of them after judges and juries, and a multitude of eye witnesses had been deceived. ”

“ Where any person—
(a) knows or suspects that an investigation by the police or the Serious Fraud Office into serious or complex fraud is being or is likely to be carried out; and (b) falsifies, conceals, destroys or otherwise disposes of, or causes or permits the falsification, concealment, destruction or disposal of documents which he knows or suspects are or would be relevant to such an investigation, he shall be guilty of an offence unless he proves that he had no intention of concealing the facts disclosed by the documents from persons carrying out such an investigation. ”

“ Offenders against the law on the one side transfer themselves to the other. Sometimes, with great difficulty they are brought to justice; but very often they wholly escape. A consciousness of immunity, from the power of avoiding justice in this way, instigates the unprincipled and reckless to the commission of offences ”

“ Beyond the obvious, immediate considerations concerning incarceration without judicial hearing, the threat of the third degree, deprivation of counsel at a possibly critical period in the criminal proceeding, etc., there lie other less evident but equally significant menaces. There is the threat that a police system which has grown to rely too heavily on interrogation will not pursue, or learn, other crime detection methods, and the consequent danger that the police will feel themselves under pressure to secure confessions. ”

“ This is American, this is fair play, it is a helping hand to the under dog. Under, because the fearless prosecutor can spend, and has often spent, hundreds of thousands of dollars to obtain a conviction. His limit is the sky, for it costs his pocket nothing, and when the prosecution makes the issue on expert testimony, the odds on conviction will be two hundred and fifty thousand dollars, which the State may perhaps spend, to this five hundred dollars granted to the defendant. ”

“ The Government asks us by a feat of construction radically to change the weights and balances in the scales of justice. The purpose and obvious effect of doing away with the requirement of a guilty intent is to ease the prosecution's path to conviction, to strip the defendant of such benefit as he derived at common law from innocence of evil purpose, and to circumscribe the freedom heretofore allowed juries. ”

“ There has been no case, gentlemen, where greater efforts were made to obtain confessions from an accused man,—a new proof that they had no evidence against him, for, when evidence is overwhelming, confessions are not solicited. But, when the evidence against a man is made up of things as ridiculous as the scene of the dictation from the bordereau, they will go to the point of fraud to extract a confession. ”

“ Yet many reasons led the inquisitor earnestly to desire to secure confession. In numerous cases - indeed, no doubt in a majority - the evidence, while possibly justifying suspicion, was of too loose and undefined a character to justify condemnation, for every idle rumor was taken up, and any flimsy pretext which led to prosecution assumed importance when the inquisitor found himself bound to show that he had not acted unadvisedly, or when he had in prospect fines and confiscations for the benefit of the faith. ”

“ The situations in which the Georgia cases do assimilate the defendant to an ordinary witness emphasize the anomalous nature of the unsworn statement. If he admits relevant facts in his statement the prosecution is relieved of the necessity of proving them by evidence of its own. 'The prisoner's admission in open court, made as a part of his statement on the trial, may be treated by the jury as direct evidence as to the facts.' Hargroves v. ”

“ As a general rule, in every crime which by its nature must most frequently go unpunished, the penalty attached to it becomes an incentive. It is a quality of our imagination, that difficulties, if they are not insurmountable nor too difficult, relatively to the mental energy of the particular person, excite the imagination more vividly, and place the object desired in larger perspective ”

“ The third degree flourishes only in secrecy. One who feels the need of a lawyer and asks for one is asking for some protection which the law can give him against a coerced confession. No matter what care is taken innocent people are convicted of crimes they did not commit, see Borchard, Convicting the Innocent (1932) ; Frank and Frank, Not Guilty (1957) . We should not lower the barriers and deny the accused any procedural safeguard against coercive police practices. [1] The trial of the issue of coercion is seldom helpful. Law officers usually testify one way, the accused another. ”

“ A man charged with an offence ought not to be compelled to confession by the promise of pardon; but is there no difference between this and actually urging him to silence against his will, as a method of escape, though he may have committed the offence? We are really sick of reading examinations, every part and portion of which are made up of injunctions to the accused, to do and say nothing whatever that can by any possibility injure his chance of eluding justice. ”

“ But real confession is so painful, and even heart-rending, because it is only of value when we begin from that moment onwards "to do what we ought to do, and to leave undone what we ought not to do." It is well for us, perhaps, to confess [Pg 367] not so much sin in the abstract as our own particular transgressions. Sin is too shadowy a monster for us to definitely avoid and forsake ”

“ THE PREVENTION OF CRIMES—OF KNOWLEDGE—MAGISTRATES—REWARDS—EDUCATION.
It is better to prevent crimes than to punish them. This is the chief aim of every good system of legislation, which is the art of leading men to the greatest possible happiness or to the least possible misery, [243] according to calculation of all the goods and evils of life. But the means hitherto employed for this end are for the most part false and contrary to the end proposed. It is impossible to reduce the turbulent activity of men to a geometrical harmony without any irregularity or confusion. ”

“ The prosecution of them, for this reason, will seldom fail to agitate the passions of the whole community, and to divide it into parties more or less friendly or inimical to the accused. In many cases, it will connect itself with the pre-existing factions, and will enlist all their animosities, partialities, influence, and interest, on one side or on the other; and, in such cases, there will always be the greatest danger that the decision will be regulated more by the comparative strength of parties, than by the real demonstrations of innocence or guilt. ”