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Thursday, January 7, 2010

Blowing the Whistle, or Begging For Mercy?


The latest twist in the saga of UBS banker Bradley Birkenfeld involves Birkenfeld's efforts, on the eve of his scheduled date to report to a federal prison, to have the Justice Department's Office of Professional Responsibility (OPR) investigate the prosecutors in his case.

The basis for the claim is that the prosecutors ignored Birkenfeld's efforts to report wrongdoing to various other federal government agencies and a Senate subcommittee, charged him with crimes and misrepresented his efforts at his sentencing hearing. 

A link to today's Daily Business Review covers this story.

Birkenfeld is claiming to be the latest white knight or whistleblower du jour.   However, not every whistleblower is innocent.   As a recent book by Boston criminal defense lawyer Harvey Silverglate chronicles in "Three Felonies a Day," wrongdoers have some powerful incentives to "compose" testimony in order to seek reductions in jail time or avoid prison altogether, and this practice seems to be met often with a blind eye or a wink and a nod. 

(Ed. Note:  Silverglate's most diplomatic language still conveys the message -- if not the outrage -- that prosecutors and investigators are tailoring testimony and sanitizing their witnesses' credibility in order to build cases in spite of the truth or how evidently false the stories are.  No wonder the Justice Department just issued new guidelines for its prosecutors on broadening what is considered exculpatory or impeachment evidence and sharing it with the defense; see my earlier article here) 

How do we know that Birkenfeld is a good guy?   Remember, this man -- who is a Swiss national -- admitted to crimes.   Being afraid of jail time may be a rational response, but does not excuse lying.   If Birkenfeld is innocent, that means he lied before a federal judge when he pled guilty.   The fact that this man may be particularly useful in exposing all sorts of tax crimes by very rich people does not make him a saint: it merely means he was in a position to reveal crimes and now, on the eve of incarceration, finds that information to be particularly useful.   

The New York Daily News' Juan Gonzalez wrote in his column yesterday that Birkenfeld deserves a statue instead of a jail sentence.   This is wrong.   If so-called good deeds excuse all bad deeds, Bernie Madoff would be at home wearing an electronic monitoring device right now.  

Several years ago, a would-be whistleblower who worked as an accountant for Enron claimed the same hero mantle.   Sherron Watkins appeared before a Senate committee, got plenty of positive -- and uncritical -- publicity, and launched a new career involving ethics training for corporations.   Then came the trial of Kenneth Lay and Jeff Skilling (both of whom were convicted).   On the stand, it was revealed that Watkins engaged in illegal, criminal insider trading and received immunity from prosecution.  

There are many totally honest whistleblowers who seek no publicity and derive no benefit from their honesty except a pink slip and, sometimes, outright ostracization (a/k/a being blackballed) from their industry or community or religious organizations.  The Birkenfeld and Watkins sagas should remind observers that not every person who claims the golden halo of the whistleblower has clean hands.  In my opinion, the whistleblower advocacy groups do themselves -- and especially the innocent whistleblowers -- no favors by hitching a ride onto the wagons of criminals who discover morality only on the ride to the courthouse.

  





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