FINAL
Remarks* of Deputy Attorney General
LARRY D. THOMPSON
Ninth Circuit Judicial Conference
Kaua'i, Hawaii
June 25, 2003
I. IntroductionGood morning. It is truly an honor to address the Ninth Circuit Judicial Conference. I am pleased to see old friends here and delighted to meet new ones.
It is my great privilege to serve as the Deputy Attorney General through these truly historic times. As we all know, since I began my tenure at the Department, we have witnessed the mass murder of over 3,000 of our fellow citizens by a foreign enemy on American soil. On another front, we have also seen our economic markets shaken by a series of shocking frauds and scandals within some of our major corporations.
In the aftermath of September 11, the President charged the Department of Justice with taking the necessary steps to prevent and disrupt terrorist activities in the American homeland and, at the same time, the Department has also been charged with helping to restore a much needed confidence in our financial markets by investigating and punishing those responsible for these corporate crimes.
I would like to talk to you briefly today about both of these important issues. In different ways, they have presented new challenges not only for the Department of Justice but also for the Judiciary.
II. War on Terrorism
As Deputy Attorney General, my charge is to ensure that the Department takes responsible, appropriate, and, yes, aggressive measures in the war on terrorism. We are duty bound to zealously represent the United States and to obtain justice through every legal and constitutional means at our disposal. And in this new world in our fight against terrorism, our focus must not only be on prosecution but also on prevention and disruption – maintaining the safety and security of our citizens.
At the same time, our authorities are not, and should not be, unbridled. I often marvel that those who criticize our actions as overly aggressive when they ignore altogether that almost all of these very actions are subject to judicial review. As a matter of law, the Department's decisions are routinely reviewed by the Judiciary.
As Judges, therefore, you face the very same weighty questions that we confront when our laws and actions in the war on terrorism are challenged. You review the criminal charges that we bring – such as the material support to terrorism charge. You review our implementation of the important new authorities and tools provided by the USA PATRIOT Act. For example, all of the electronic surveillance techniques authorized by the USA PATRIOT Act are subject to judicial review. The same is true with regard to the disclosure of information obtained through the Special Administrative Measures (or "SAMs") for monitoring of prisoners' communications with their attorneys. We cannot detain material witnesses without your authorization. Even the President's designation of enemy combatants is subject to judicial review via habeas corpus when the enemy combatants are U.S. citizens.
The Judiciary is essential to the process. Although we may not always agree with every one of your rulings, judicial review is an essential element of a freedom loving democracy. I met with retired Justice Baruck of the Israeli Supreme Court after 9-11. It was a profound experience. He left with me a copy of a decision of his court. As the Israeli Supreme Court stated when confronted with the question of the propriety of so-called "moderate physical pressure" in interrogating terrorism suspects, "A democratic peace-loving society does not accept that investigators use any means for the purpose of uncovering the truth ... . At times, the price of truth is so high that a democratic society is not prepared to pay it."
The Israeli Court's conclusion applies equally to our country that: "This is the destiny of democracy, as not all means are acceptable to it, and not all practices employed by its enemies are open before it. Although a democracy must often fight with one hand tied behind its back, it nonetheless has the upper hand. Preserving the Rule of Law and recognition of an individual's liberty constitutes an important component in its understanding of security. At the end of the day, they strengthen its spirit and [add to] its strength and allow it to overcome its difficulties."
The Israeli Supreme Court is a court that has had to deal not only with the difficult questions bound to arise in a society combating terror while holding steadfast to its democratic values, it is a court whose members feel the threat of terrorism on a daily basis. Their example teaches that a strong, vibrant, and independent judiciary is essential to maintaining the proper balance.
Indeed, an independent judiciary is critical to a free society. And the Department of Justice, which has more interactions with the Judiciary than any other group of lawyers, must do, I believe, everything it can to ensure that this independence is honored and respected.
We must also do everything in our power to help recruit to the Judiciary leading legal minds to contemplate and decide these important questions. Now more than ever before, I believe we need to attract great jurists to the Judiciary and we need to keep them there. During these challenging times, nothing less is acceptable, and one essential step that we can take is to support the call for increased judicial pay. This past May, the President announced his support for increasing judicial pay across the United States. The Justice Department and the Administration are committed to working with Congress to ensure that this problem is appropriately addressed.
III. Corporate Fraud
Just as much of my daily work is focused on the war on terrorism, so too do I devote a great deal of time to fighting corporate fraud and abuse.
The President has charged the Department, along with a coalition of federal regulatory and enforcement agencies, with helping to restore confidence in the markets. We must hold corporations and executives accountable for their wrongdoing, while being careful not to stultify the entrepreneurial spirit or inhibit risk-taking essential to a prosperous economy.
And we are pursuing an aggressive agenda.
As an overarching goal, we have strived to make clear that criminal conduct will not be tolerated and that the consequences of such conduct are severe and virtually certain. With every exposure and prosecution, I believe that we are increasing confidence in the integrity of the system.
And we are emphasizing speed as well as thoroughness. Since this renewed emphasis, complex cases that would have taken three to four years to complete, are now being brought in a far more timely manner. Swift prosecution not only brings concrete results but also reduces market uncertainty. The results have been remarkable:
1. Since July 2001, more than 200 corporate fraud investigations were opened;
2. more than 200 individuals were charged;
3. we have had more than 75 convictions; and
4. DOJ and the SEC have sought more than $1 billion in forefeiture or disgorgement.And we've undertaken another significant effort.
In January 2003, we revised the Department's corporate prosecution guidelines, which provide our prosecutors with direction as to whether or not to indict corporations. We needed to clearly articulate to the bar and corporations what the DOJ would expect of them in these very serious criminal investigations. One major focus of these revised guidelines is an increased emphasis on ensuring the authenticity of a corporation's cooperation. We have stated that in deciding whether to charge a corporation, prosecutors can look to whether the corporation has provided timely and voluntary disclosure. If possible, prosecutors may also consider the corporation's willingness to identify the culprits within the corporation, including senior executives; to make witnesses available; to disclose the complete results of its internal investigation; and in appropriate circumstances to waive attorney-client and work product protection.
We have stressed that corporate counsel must deliver what they promise when they tell us that their corporate client is cooperating. We have found that some corporations purport to cooperate with the Department's investigations but in fact take various steps to block the quick and effective exposure of the complete scope of wrongdoing.
We will not tolerate conduct that ultimately obstructs our investigations, whether veiled or overt. We are particularly watchful for: (1) overly broad assertions of corporate representation of employees; (2) inappropriate directions to employees to not volunteer information or decline interviews; and (3) presentations or assertions that contain misleading information or omissions.
The other side of this coin is that where corporations are cooperating, we will exercise appropriate prosecutorial discretion in perhaps deciding not to charge or to bring lesser charges. We are always mindful of the real world consequences of a decision to indict a corporation – especially disproportionate harm to innocent employees, communities and shareholders.
We are always seeking to make sure that the individuals who purport to lead our corporations are in fact doing so and in a responsible way. In almost every instance, it is ultimately better for the shareholders that officers and directors provide relevant information to the appropriate investigating authorities. While it may not provide any benefit to corrupt corporate officials, a fair and quick resolution will certainly benefit investors. More often than not, where corporations cooperate and behave responsibly and ethically, they will oust corrupt management and seek to make the shareholders whole.
And the Rule of Law is important in our fight against corporate crime.
Honest businesspeople must remain free to compete in a healthy economic environment, enabling the entrepreneurial spirit to flourish and our markets to remain open and competitive.
Almost 60 years ago, the philosopher Friedrich Hayek recognized that, "While every law restricts individual freedom to some extent by altering the means which people may use in the pursuit of their aims, under the Rule of Law the government is prevented from stultifying individual efforts by ad hoc action. Within the known rules of the game the individual is free to pursue his personal ends and desires...."
IV. ConclusionWe are also constantly learning from the Courts. While you sometimes do not agree with us, I would like to humbly add that we pride ourselves in the excellence and civility of the advocacy of the Department's lawyers that appear before you. It is an honor to participate in this democratic process with you.
Again, thank you for inviting me to speak before such a distinguished gathering. I welcome any questions that you might have.
*NOTE: Mr. Thompson frequently speaks from notes and may depart from the speech as prepared. However, he stands behind the speech as presented in written format.