When Will the Perp Walks Start?
Interesting listening on today’s Morning Ireland (well worth a listen). George Lee has now formally used the word “fraud” in relation to what has been happening in Anglo Irish Bank. About time too. And if Anglo have a problem with that, I look forward to them suing George Lee and RTÉ. I don’t think they’ll get very far. So what are our law enforcement authorities going to do about it?
The US Securities and Exchange Commission (SEC) doesn’t mess about. If companies or their executives are caught fiddling the books, commiting fraud, misrepresenting the situation to the market or any of a huge variety of other offences they are arrested. And not quietly. The do what’s called a Perp walk.
The guys who are alledged to have caused the collapse of Bear Stearns were dragged from their homes in handcuffs in front of the media by FBI agents.
This has caused a huge deterrent factor in the States. Here in Ireland, the chances of someone being prosecuted over what’s happened in the banks, even when it appears that there was “fraud” involved, is minimal.
The chances of them being arrested and brought in front of the courts in handcuffs is even smaller.
The two guys pictured here were arrested on suspicion of ‘conspiracy’. Under US law, a not dissimilar thing in these cases from the “fraud” George Lee described on Morning Ireland.
Enron’s senior executives hit exactly the same problem when it appeared that they had misrepresented their company’s position in annual accounts for several years running (ring any bells?). Ken Lay and Jeff Skilling were both perp walked, prosecuted and sent to jail.
News Observer puts it very well in a piece they carried after they showed a perp walk photo on their front page:
This is the occasion, after an arrest is made, when the accused is being taken from one place — like a lockup — to another place — like a courthouse. Or maybe from the courthouse to another place. This is usually the best opportunity for photographers to get pictures or video of the perp.
In high profile cases, the perp walk takes on special symbolism. It conveys a message from law enforcement: We got him. We are on the case.
In cases of white-collar crime, it has taken on an even greater significance. It is law enforcement’s way of sending the message that even though the accused may be a millionaire and a big-deal executive, he is going to be treated like a common criminal.
There is nothing that focuses the minds of big-shots on Wall Street like the sight of a former colleague being marched in handcuffs past a swarm of cameras by federal agents. Sometimes the federal agents actually walk into the big Wall Street firms and march the accused right out of his office, in front of co-workers.
Our problem here is two fold. First, you never see white collar criminals being perp walked. Second, we apparently (if you listen to the Minister for Finance, who said that there was nothing illegal about what’s being going on in Anglo) have no laws against anything that’s happened to date. For shame.
Bring in the perp walk. If it’s necessary, bring in the laws to make what’s been going on illegal. But I don’t think it’s necessary. Fraud has been illegal in Ireland for a very, very long time.