White-Collar Crime Is the Way to Go
First, this announcement, brought to you by your Constitution: She has not been accused of a crime. She has not even been sent to her room without her dinner (although she could probably fashion a meal out of old tic tacs and cracker crumbs in the bottom of her purse).
Everybody squared away on that? Good.
Martha Stewart--Miss Billion-Dollar Conglomerate, the girl voted Most Wanted to Be Spotted Coming Out of the Restroom with Toilet Paper Stuck to Her Shoe--is in trouble.
The CEO, who has done more to make the average woman feel inadequate than anyone since Hugh Hefner, is getting the twice-over from congressional investigators.
They’re asking those grand old questions that generally get asked before we start hearing some phrase with -gate stuck on the end of it: What did she know, and when did she know it? How is it she happened to sell off several thousand shares of ImClone Systems Inc. just one day before bad news about the stock in question sent the share price south faster than mallards in October?
Could Martha’s next cookbook really be “Stirring It Up in Stir: Favorite Recipes of the Graybar Hotel”? Will her magazine, Martha Stewart Living, be retitled “Martha Stewart Serving,” with tips on how to keep the creases sharp in your prison jumpsuit?
The fact of it is, no. Martha Stewart’s just happens to be a more familiar face than much likelier targets. No one knows enough about Rite Aid’s Martin L. Grass and company ($1.6 billion “restatement of earnings” that the feds call fraud), Tyco International’s L. Dennis Kozlowski (indicted on charges of dodging state and city sales tax), ImClone’s Samuel Waksal, or even Enron’s Kenneth “Po-Mouth” Lay, to make fun of them.
Added together, the newest generation of accused may have ripped off the equivalent of the GDP of several small nations, but because they did it with the point of a pen and not the point of a gun, the odds are that if they serve any time at all, it may be no more than they might spend on a leisurely round-the-world cruise. And their prison, like the QEII, might offer shuffleboard and swimming.
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Two decades’ worth of savings-and-loan shysters, stock fraudsters and investment scammers have given us men like Charles Keating, who had the chutzpah to scold Hefner on behalf of the “Citizens for Decency,” and then turn around and peddle his own brand of obscenity--worthless junk bonds--to trusting old ladies who wound up eating cat food.
Add them all up and all these men probably served less time in prison than a single three-striker’s life sentence.
Henry Pontell at UC Irvine found in 1994 that the S&L; swindlers--if they served time at all--served a couple of months’ less for devastating hundreds or thousands of investors’ lives than your average car thief did for pinching a Toyota.
Is there really any reason to think things might be different this time around? Could Fortune magazine’s cover demanding “Send them to jail” really turn out to be anything more than show-trial wishful thinking?
Compared to white-collar crime, nailing the less-than-bright, two-a-penny petty criminal, the burglar or bank robber, is easy. Easy to find, easy to convict, easy to add up to a good conviction rate. Sticking it to the white-collar felon requires sophisticated computer and financial skills, long, long hours and lots and lots of money. If your standard petty criminal case were as tough and complicated, it’d be like prosecuting O.J. Simpson 20 times a week.
UC Irvine’s Gilbert Geis has written a lot about white-collar crime, and says prosecuting it is hard for three reasons. The first is proving intent--”That’s very difficult. Second, they’re more sophisticated. That’s one of the reasons they got so rich--they know how to cover up. Thirdly, they’ve got a lot of money so they get very good attorneys,” and the chances of being caught in the first place are “very slim,” and if they are, “the penalty tends to be minimal.”
Added to that is the public, confused and bored and possessed, says Geis, of a certain sneaking envy. “I look at baseball players and Enron salaries and I may be morally outraged, but I think, ‘Hey, I wouldn’t mind having that money either,’ and that helps to dim the outrage.”
If anything can make this time different--”spectacularly different”--it’s the “dramatically enormous gulf between haves and have-nots now.... I think crime is a function of a society’s ethos, and I think ethos is becoming more and more financially corrupt.”
And unless it’s different, “spectacularly different,” any faint-hearted prosecution, any sentence that sends an 18-year-old first-time offender to the slammer until he’s old enough to run for president, for knocking over a mini-mart for a hundred bucks and some beer, could also be, “Next time you steal, do it right. Do it big. It’s the American way.”
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Patt Morrison’s column appears Mondays and Wednesdays. Her e-mail address is patt.morrison@latimes.com.
