On July 9, 2002, George Bush went to Wall Street to lay the smack down, after a rash of corporate scandals was leading to a crisis of confidence.
His Wall Street speech was long on exhortatory generalities but short on substance and specifics. Delivered at the Regent Wall Street Hotel to a crowd of about a thousand corporate CEOs and Wall Street leaders against a backdrop on which the words "Corporate Responsibility" were printed over and over in bold letters, Bush's wooden speech satisfied few except, perhaps, the CEOs against whom he allegedly railed. According to (New York) Newsday, executives emerged from the Regent Hotel "grinning like they'd just been handed fat new stock-option deals.... The executives Bush came to pillory, they swore they loved the speech. And why not? Savvy Wall Streeters realized what any half-intelligent person would. This was for the cameras." Once again, instead of exposing a broken system that needed fixing, he blamed a degradation of moral fiber among a few corporate executives. (1)The Harper government has taken the same approach to addressing white collar crime. A lot of posturing but little substance. The first bill they brought forward, went up in smoke when Stephen Harper prorogued Parliament, for the second time, to save his job.
From the last throne speech:
- Recognizing the critical importance of sound securities regulation – both to attract investment and crack down on white-collar crime – our Government will act, within the ambit of the Constitution, to create a Canadian securities regulator.
- Our Government will now focus on the further protection of children, women and victims of white-collar crime.
- Hard-working Canadians who entrust their retirement savings to others have a right to see that trust honoured. Our Government will also introduce legislation to crack down on white-collar crime and secure justice for victims through tougher sentences.
The new bill C-21, while thought to be an important first step, was also deemed by others to be a mere baby step. Because it only spoke of punishment for fraudsters, while not addressing measures to prevent these crimes from happening.
According to Lincoln Caylor and Joseph Groiar in the Globe and Mail:
Like Bush, Harper made a lot of promises to get tough on white collar criminals, but the fact is that the bill lacks teeth.
Recently introduced legislation, Standing Up for Victims of White-Collar Crime Act (Bill C-21), seeks to address this problem by imposing tougher sentences on convicted fraudsters. Where the proceeds of the crime exceed $1-million, individuals who are convicted will be subject to mandatory minimum sentences of two years. Also, sentencing judges will be required to consider making a restitution order to compensate victims of the crime. These are well-intentioned measures meant to strengthen the justice system’s ability to combat large-scale frauds. But without a commitment to a more comprehensive approach, these changes will only impose additional obligations on the current enforcement structure, which is already overburdened and under-resourced.
Ironically, the introduction of Bill C-21 may lead to fewer cases going forward. Experience in the United States has taught us that the effect of mandatory minimum sentences is an increase in the number of trials and a reduction in the number of guilty pleas. Second, the Crown will be required to quantify the proceeds of a fraud due to the million-dollar threshold, something it’s not well-equipped to do.
Finally, the current system doesn’t have the ability to deal with the distribution of assets of a fraud among a large number of victims with varying claims. ... The proposed legislation also leaves victims of fraud with the impression that they will get their money back through the criminal sentencing process. But such a belief is misguided. While the draft legislation requires a sentencing judge to consider issuing a restitution order, it does nothing to change the fact that, by the time law enforcement is involved, the money has often long disappeared.
The president did propose "tough new criminal penalties for corporate fraud," adding that such "legislation would double the maximum prison terms for those convicted of financial fraud from five to ten years. Defrauding investors is a serious offense, and the punishment must be as serious as the crime." Unfortunately, all prosecutors will tell you how hard it is to actually convict individual executives of criminal fraud, hidden as they are behind the collective corporate form, without the extraordinary devotion of government resources.
...The creation of the new Corporate Fraud Task Force within the Justice Department was announced by the president in his Wall Street speech as "a corporate crimes SWAT team." But as CorpWatch, a progressive watchdog group devoted to corporate responsibility, reports ... Bush actually reduced the number of FBI agents on the corporate crime beat by fifty-nine,redeploying them for the anti-terrorism effort. So it looks like the Fraud TaskForce is itself a fraud."
And given that the Harper government has signed on to new accounting rules that make it legal to misrepresent your company's financial situation, I would say that their recent changes are just another fraud.
1. The Book on Bush: How George W. (mis) Leads America, By Eric Alterman and Mark Green, Penguin Books, 2004, ISBN: 0-670-03273-5, Pg. 68-69