Recently, a federal appeals court reversed a lower court's lenient sentence for conspiracy and money laundering of a chief executive of an Ohio technology firm that collapsed in 2003 due to alleged fraud. This sentence is evidence that defendants convicted of white collar felonies may receive more lenient treatment in the legal system than those convicted of other crimes. The judge in the case received letters of support from those who knew the defendant, and imposed a mere seven-day sentence for the crime of fraud, despite the fact that sentencing guidelines mandate an 8-10 year sentence based on the $18 million loss to the company's shareholders due to the fraud. The appeals court struck down the sentence, stating that the judge abused her discretion by taking into account factors that were not allowed in imposing sentences.
Suspicious Wall Street trading draws FBI attention
The Federal Bureau of Investigation (FBI) is currently investigating alleged insider trading regarding the $23 billion purchase of H.J. Heinz. The purpose behind the FBI's investigation is to determine whether or not a felony was committed, and if so, who was responsible.
Prosecutors find charging CEOs with insider trading difficult
Recently, a former New York attorney general and governor commented on the difficulty of charging the CEOs of Wall Street firms with insider trading and other white collar crimes. Many hedge fund players on Wall Street were tried and convicted of the felony of insider trading, and the turmoil within these companies substantially damaged the economy. Many of these companies entered into expensive monetary settlements, while few of the CEOs were punished. There is a strong sentiment that the prosecutions did not address the main structural issues within the financial community that led to the banking crash of 2008.
