02.09.12

Comments Of Senator Patrick Leahy On Public Corruption Amendment And The STOCK Act

“Now that the House of Representatives has voted to approve its version of the STOCK Act, I hope the Senate and House will meet for a conference to resolve differences between these two bills.  The Senate overwhelmingly approved its legislation last Thursday, and with it, adopted by a voice vote an amendment I offered with Senator Cornyn, Senator Kirk, and Senator Casey to give some real teeth to this bill.  If we want to make clear to our constituents that we are not in the business of self-dealing and insider-trading, we should take the opportunity to state unequivocally that we do not, and we will not, tolerate public corruption.  This narrowly crafted amendment has bipartisan support, in both chambers of Congress, and the House’s vote today should not be the final word on this important anti-corruption provision.  We should enact this bipartisan proposal, send it to the President to be signed into law, and show all Americans that Congress takes seriously the need for public accountability particularly when it comes to rooting out public corruption.”

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For Background Purposes
Correcting The Record:
Public Corruption Amendment Carefully Crafted And Precisely Drafted


Outside organizations have in recent days released misguided and inaccurate information with respect to the Leahy-Cornyn amendment to the STOCK Act to bolster tools for law enforcement to crack down on public corruption, calling the amendment overly broad and vague.  These claims do not acknowledge the version of the amendment that was included as an amendment to the Senate’s STOCK Act – and adopted with overwhelming support by voice vote.  The Leahy-Cornyn amendment reflects bipartisan, bicameral agreement, with Reps. Sensenbrenner and Quigley, who introduced the companion bill, H.R. 2572, which was reported unanimously by the House Judiciary Committee and has been significantly improved since versions previously considered.    

The restoration of the honest services statute is clear, limited and appropriate.

The Leahy-Cornyn amendment, in a clear and limited way, restores the crucial honest services fraud statute, which was gutted by the Supreme Court in 2010.  The amendment replaces a very general statute with a carefully and precisely drawn crime that gives individuals clear notice as to when their conduct runs afoul of the law.

To be guilty of “undisclosed self-dealing” under this amendment, the official must knowingly fail to disclose an interest required to be disclosed by the relevant jurisdiction’s laws or rules – precisely the kind of notice courts critical of honest services in the past fraud wanted included in the statute.  An official must further intentionally act to benefit the financial interest that had been covered up, and the purpose of the act must be ‘in whole or in material part’ to benefit that interest.

This new provision has unprecedented layers of required intent and unusual depth and precision in its definitions.  It is exactly the kind of detailed statute that the critics of white collar criminal statutes have claimed to want.

Numerous safeguards are built into the amendment, and will only target corrupt conduct.


The gratuities fix in the amendment restores congressional intent and addresses a Supreme Court holding that greatly limited the use of the gratuities statute as a matter of statutory construction, which can appropriately be fixed by Congress.

The amendment explicitly excludes from prosecution as a status gratuity any gift allowed by rules or regulations and any gift worth less than $1,000, so giving or receiving of legitimate gifts like baseball caps and replica jerseys would never be covered.  The specified elements of the offense and the general intent requirement mean that this statute will only be used to go after knowing conduct and cannot be used to go after inadvertent conduct or mistakes.

The gratuities statute is meant to meet a lower threshold than bribery and to get at improper gifts given to curry favor with a public official to secure some unspecified favorable treatment in the future.  This amendment restores that statute and makes it meaningful again.

The sentencing increases in the amendment are modest and appropriate.

The Public Corruption Prosecution Improvements Act includes select increases in sentences for major corruption offenses.  Sentences for corruption offenses throughout the code are significantly lower than for many other offenses in the United States Code, despite the insidious nature of these offenses and the need to deter corrupt conduct.  The bill does not include any mandatory minimum sentences.

 

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