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An Open Letter to John Ashcroft on Corporate Crime

by RALPH NADER And LEE DRUTMAN

 

Dear Mr. Ashcroft:

Recently, your Federal Bureau of Investigations released its annual “Crime in the United States” report, which pulls together comprehensive data on eight crime indexes: murder and manslaughter; forcible rape; robbery; aggravated assault; burglary; larceny-theft; motor vehicle theft; and arson. The report is obviously useful in empowering law enforcement professionals and the public; it helps them to better understand and respond to criminal trends.

Conspicuously absent from this report, however, is an assessment of corporate crime. The report contains no statistics on the accounting, securities, and financial services crimes that have rocked the economy in the last two years. It does not list details on the litany of food safety violations, product safety violations, workplace safety violations, environmental pollution and countless other crimes that kill, injure and sicken millions of Americans each year.

Certainly, as attorney general of the United States, you should understand the problem of corporate crime. After all, in a September 27, 2002 address to the Corporate Fraud/Responsibility Conference, you said that “the malignancy of corporate corruption threatens more than the future of a few companies — it destroys workers’ incomes, decimates families’ savings and casts a shadow on the health, integrity and good name of business itself.” You warned that “We cannot — we will not — surrender freedom for all to the tyranny of greed for the few.” You told prosecutors that “with each act of justice, you send the unmistakable message that no board room is beyond the law, no executive is above the law.”

Yet, because the FBI does not collect data on corporate crime, both the American public and the law enforcement community lack good information on what has become a pressing national problem – a corporate crime wave. Comprehensive data on corporate crime would help law enforcement officials to better analyze patterns and better direct resources. Information is also a powerful tool for public support of strong law enforcement, and the lack of it hampers your efforts to stay true to your tough words on corporate crime.

Corporate crime, as you surely recognize, is no small problem. Where the costs have been estimated, the numbers are staggering. Most credible estimates confirm that, in the aggregate, white-collar and corporate crimes cost the U.S. hundreds of billions of dollars annually – far more than conventional categories of crime such as burglary and robbery – and cause many preventable deaths, injuries, and disease.

Using conservative numbers issued by the U.S. Chamber of Commerce, for instance, criminologist Jeffrey Reiman, a professor at American University, estimated that the total cost of white-collar crime in 1997 was $338 billion. The actual cost is probably much greater. For instance, the General Accounting Office, the investigative arm of Congress, estimates that health-care fraud alone costs up to $100 billion each year. Another estimate (by University of Cincinnati Criminal Justice Professor Francis T. Cullen) suggests that the annual cost of antitrust or trade violations is at least $250 billion. By comparison, the FBI estimated that in 2002, the nation’s total loss from robbery, burglary, larceny-theft, motor vehicle theft and arson was less than $18 billion – less than a third of the estimated $60 billion Enron alone cost investors, pensioners and employees.

But corporate crime isn’t just about the money. It’s also about people’s lives. The national murder rate has hovered around 16,000 per year in recent years (In 2002, the FBI reported 16,204 murders). But statistics from a respected group of occupational health and safety investigators, led by Professor J. Paul Leigh, have estimated that in 1992 alone there were 66,971 total job-related injury and occupational disease deaths. These numbers do not include the thousands of annual deaths caused by cancers linked to corporate pollution, deaths from defective products, tainted foods, and other corporate-related causes. Though we can begin to estimate, it is hard to know how many deaths are caused by corporate crime, since again, we have no official numbers or annual reports.

There is now a growing consensus that corporate crime is a mammoth problem threatening the stability of our economy and the security of millions of Americans. But how mammoth exactly? This is what millions of Americans would like to know through official and authoritative sources from a government that should be acting to diminish such public dangers, not ignore them.

Mr. Ashcroft, if you are indeed serious about enforcing the rule of law fairly and justly in this country, we urge you to direct the FBI to expand its annual “Crime in the United States Report” to actually describe all the crime in the United States, not just street-level criminal activity. Corporate crime is a huge problem, with far more impact on society than street crime. The major media has recognized this point more and more in the past three years in headlines and cover stories and editorials. And with the help of more comprehensive data, we could gain an even better understanding of the problem, which is essential to solving it.

We expect you to take this matter seriously and look forward to your timely response.

Sincerely,

Ralph Nader Founder, Citizen Works

Lee Drutman Communications Director, Citizen Works

 

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