With an incoming President-elect Biden, it’s looking like the party for Wall Street – and the white collar fraud that it brings with it – could be coming to an end.
While during the Trump administration fines and prosecutions related to white collar crime fell, lawyers anticipate it “ramping up” under a Biden administration. White collar defense attorney Robert Anello told Bloomberg that his practice “ground to a halt” during the Trump administration.
In addition to prosecuting white collar crime on Wall Street, tax cheats and foreign bribes will also be in focus under a Biden administration, Anello said. There will also be plenty of interest in the government funding provided as part of the Paycheck Protection Program, he said.
Brandon Garrett, professor of law at Duke University, said the change under the Biden administration may not be noticeable right away, as white collar cases take time to assemble. But he expects more cases overall, including insider trading and accounting scams. We have a few suggestions as to where they could get started…
Garrett said: “There’s often kind of a life cycle to fraud. If we have lax enforcement for a number of years, there will be a lot of serious misconduct and fraud that will have been brushed under the rug and so I would expect a serious backlog of cases of all types.”
The Trump administration, trying to present itself as “pro-business”, has overseen a large decline in enforcement. Prosecution of white collar crime has hit record lows, helped along by the slowing of the courts as a result of Covid-19. Syracuse University’s Transactional Records Access Clearinghouse shows a 30% drop in annual prosecutions since the Obama administration.
Corporate fines were down 76% in Trump’s first 20 months in office, compared to the 20 final months during Obama’s administration. During the same time, corporate penalties totaled $3.4 billion, spread out between 17 financial institutions and 13 public companies, compared to $14.15 billion, 71 financial institutions and 34 public companies during Obama’s administration.
Cheryl Bader, a professor at Fordham Law School in New York, said: “Anything would be a step up from Trump’s complete neglect of white-collar crime. He wants to see himself as the business-friendly president.”
“When Trump talks about law and order, he’s not talking about law and order as relates to white-collar crime. He’s talking about law and order, frankly in terms of minority people,” said Joel Cohen, a former federal prosecutor in New York now in private practice.
The Trump administration did, however, oversee a $2.9 billion penalty for Goldman Sachs’ Malaysia unit and felony charges lodged against Purdue Pharma LP, over the last four years.
A. Brian Albritton, who served as the top federal prosecutor in central Florida under Presidents George W. Bush and Obama, said Trump was more focused on violent crime: “Violent crime has been a priority for the Trump administration. I would anticipate fewer resources devoted to immigration crimes.”