KPMG and Scott London: Long-Forgotten Devil's Deal Means Feds Are Unlikely to Bring Corporate Charges

On March 20 former KPMG partner Scott London admitted to passing confidential inside information to his friend Bryan Shaw, who reportedly traded on that information, making over a million dollars. In my most recent “Injustice Department” column for Forbes.com, co-authored with my research assistants Juliana DeVries and Zachary Bloom, I explain how appalling violations of trust are nothing new to the KPMG leadership, considering their long-forgotten devil’s deal with the U.S. Department of Justice back in 2004, whereby the firm “cooperated” with the government and threw its employees and clients under the bus. A culture of betrayal is made almost inevitable by the prosecutorial  tactics of the DOJ, which turn colleague against colleague and company against employee on the basis of not-always-truthful testimony.

You canfind the column here, on my "Injustice Department" blog.

Comments (0)

Gibson Is Off the Feds' Hook. Who's Next?

On July 30, I wrote a piece on my “Injustice Department” blog on Forbes.com discussing the narrow-mindedness of the Gibson Guitar Company CEO’s claim in a Wall Street Journal op-ed that the United States Justice Department is waging a war against capitalism. It is a war, I suggested, against many sectors of civil society.

Since that piece went up, Gibson Guitar has entered into a deal with the DOJ in which it sort-of admits guilt to alleged violations of the Lacey Act, pays a whopping fine, and will emerge without a criminal conviction in the end. Gibson took this step even though the company and its CEO earlier had publicly proclaimed their innocence. My latest piece, published in today’s Wall Street Journal, explains how corrupt plea-bargaining practices at the Department of Justice, as opposed to actual guilt, likely led to Gibson’s guilty plea and, most disturbingly, to its agreement to stick to a negotiated script with regard to the question of guilt versus innocence. As is increasingly true at the Department of Justice – via a process that has been gaining momentum since at least the mid-1980s – there is no longer a principled and discernible line between truth and falsehood.


Comments (0)

Justice 'Deferred'


In a recent front-page article in The New York Times, reporters Gretchen Morgensen and Louise Story argue that “Deferred Prosecution Agreements” represent a softer approach to corporate crime. What the Times misses, however, is the extent to which these arrangements, and their proclivity for punishing the innocent, sow terror within the rank and file of corporate employees and officers. The Deferred Agreements, I write in my latest Forbes.com column, represent a creative way for the federal government to extract a large fine from the company, manufacture convictions of individual officers and employees, enhance the reputations and conviction rates of federal prosecutors before they head to Wall Street law firms for high-paying partnerships--all while dispensing with the inconvenience of indictment or trial.
Comments (0)
Updates related to Harvey's
book Three Felonies a Day, a critical
take on the Justice Department

Archive by Years