In three separate appeals, former Enron chief Jeffrey Skilling, deposed Sun-Times boss Conrad Black and former Alaska legislator Bruce Weyhrauch, all white-collar convicts, persuaded the U.S. Supreme Court to review the constitutionality of a federal statute that calls it fraud to "deprive another of the intangible right to honest services."
A ruling in their favor would force former Gov. Rod Blagojevich's prosecutors to scale back their 19-count indictment, a result that fair-minded citizens should applaud.
Honest-services fraud is front and center among the charges leveled against Mr. Blagojevich, who stands accused of depriving Illinois' residents of their right to good government through a massive scheme inviting kickbacks, threatening to withhold state assistance to Chicago-based Tribune Co. unless editorial board members critical of the then-governor were fired, and even conspiring to sell the unexpired term of President Barack Obama's former Senate seat.
If the prosecution can prove these allegations beyond a reasonable doubt, sanctions might be imposed for the crimes of wire fraud, mail fraud, extortion, bribery or conspiracy to commit such a crime, all of whose elements are crystal clear. Those well-established crimes have definitions understood by prosecutors, defense counsel and judges alike. But no judge should divine what it takes to deny the citizenry its intangible right to a governor's honest services.
Alleging a violation of the honest-services law has become a too-convenient charge when aggressive prosecutors build public corruption cases. Since the honest-services law doesn't even require proof that a defendant actually received cash or goods by misconduct in office, corruption-busting prosecutors have found the law to be a sharp weapon when pressed to prove that taxpayers or shareholders suffered a financial loss, or that a defendant was personally enriched by his misdeed.
The Supreme Court should gut the law so that prosecutors can no longer exploit the ill-defined nature of honest-services fraud.
Justice Antonin Scalia, dissenting from the court's decision this year not to hear the appeal of Robert Sorich, convicted of fraud in recruiting Chicago patronage workers, railed against the law: "Without some coherent limiting principle to define what 'the intangible right of honest services' is, whence it derives and how it is violated, this expansive phrase invites abuse by headline-grabbing prosecutors."
Mr. Blagojevich deserves our sympathy no more than Messrs. Skilling, Black or Weyhrauch, but they are all entitled to fair trials on fair charges.
Lavrenti Beria, the cruelest of Stalin's henchmen, famously gloated, "Give me the man, and I will find the crime." We're better than that.
Marc J. Lane, a business and tax attorney and financial advisor, practices law at The Law Offices of Marc J. Lane, P.C. (www.MarcJLane.com) in Chicago.
Our December 2009 Lane Report was adapted from a column published in Crain's Chicago Business on November 23, 2009. Reprinted with permission from Crain Communication Inc., Copyright 2009.
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