HONEST SERVICES FRAUD

http://townhall.com/columnists/KenKlukowski/2009/12/11/high_court_considers_whether_feds_can_make_everyone_a_criminal


Friday, December 11, 2009
High Court Considers Whether Feds Can Make Everyone a Criminal
by Ken Klukowski

What if there was a federal law stating that anytime you owe anyone a duty to be honest and you violate that duty, you’re committing a federal felony? Guess what—there already is. And now the Supreme Court is deciding whether to strike it down.
There’s a federal law on the books called “honest services fraud,” making it a crime to deprive anyone of the “intangible right of honest services.” In other words, if you’re in a relationship where you have a duty to provide a service to someone (government, employer, etc.), and you engage in any sort of deceit resulting in them not getting your honest, good-faith efforts, then you’ve committed a felony that could land you in federal prison for twenty years.
The idea behind the law didn’t start off too badly. Because the federal government provides the U.S. Postal Service, it’s a federal crime to use the U.S. mail to engage in fraud. From that, Congress wanted to go after any fraud where the criminal used the mail service.
But the problem with government is that it tends to expand, including expanding its ability to throw people in jail.
Fortunately, the Constitution provides a check on this power. Often these days, “due process” is used as a catchall to advance any number of legal theories, most of them liberal. But one correct doctrine from the Due Process Clause of the Fifth Amendment and Fourteenth Amendment is that a statute can be “void for vagueness.”
What that means is that one of the principles of our criminal-law system is the concept of “notice.” Although ignorance of the law is no excuse, the law must be written with sufficient clarity that if a particular action is a crime, a citizen who does due diligence into that law should be put on notice that the action he’s thinking of is criminal.
Put otherwise, if a law is so vague that a person can’t tell if a particular action falls within what that law forbids, then the law is so vague that it would violate due process to punish him for breaking it. You can’t justly punish someone if they couldn’t have known that what they did is forbidden.
That was what the Court heard arguments about in two cases on Dec. 8. One was Black v. U.S., where three corporate employees engaged in a fraudulent scheme. The other was Weyhrauch v. U.S., where a state representative in the Alaska legislature engaged in some shady business.
The problem is this: Fraud is already illegal in all fifty states. If you lie, cheat or steal, you can go to prison and be forced to pay restitution. This isn’t about people getting away with doing wrong; district attorneys and state authorities are more than capable of enforcing their state laws to hold dishonest people accountable
The federal government shouldn’t be involved in a law that is so sweeping that everyone reading this column could be thrown in prison. Yet I guarantee you that you’ve violated this law at least once.
The justices clearly got this point. Justice Breyer—the most moderate of the liberals on the Court—posed hypothetical situations such as one where a boss stops by a worker’s cubicle, then the worker lies about focusing on his current work task to get the boss to move on down the office so that the worker can resume looking at race-track forms instead of working. Breyer pointed out that this would deprive the company of “honest services” to the financial loss of the company, and could be prosecuted under this law. Both he and Justice Sotomayor were looking for a way to save the statute by narrowing its meaning to avoid such situations.
Sensing it was on shaky ground, the Obama Justice Department tried to assure the Court that the law would realistically only be applied in cases of bribery, kickbacks, or conflicts of interest where there is a financial impact.
Although the Court could interpret the statute as a narrow one barring those three specific crimes, it looks like there may be five votes to strike it down altogether as being void for vagueness. It’s unclear, because Chief Justice Roberts seemed troubled that Black’s court briefs didn’t fully argue that issue. But Black’s lawyer pointed out that it was a central argument before the lower courts in this case, and Justice Scalia tried to save the possibility by signaling that he was in favor of picking up on that question where the lower courts left off, instead of having to do “somersaults” to save a statute that should be struck down.
Scalia compared this statute to a fictional criminal law that says, “No person shall commit a bad act.” There’s no way to know exactly what that means, and it gives government too much power to prosecute for any “bad act” it chooses. Even if “bad act” only means “bribery,” Scalia continued, it violates due process for a person to have to take their case all the way to the U.S. Supreme Court before that definition is put in place. The law must be written in a way that people understand from the beginning what sorts of behavior are forbidden.
One very unfortunate fact for the Obama-Holder Justice Department is that Black is being represented by the person who should have been America’s first Hispanic justice on the Supreme Court: Miguel Estrada. On questions such as Roberts’ concern about briefing the vagueness issue, Estrada’s answers and arguments were brilliant, and may have cleared the high hurdle needed to get the Court to take the much more aggressive route of striking down the statute.
Chief Justice John Marshall—who did more to shape the role of the courts in America than any other man—said in 1819 in one of the Court’s most famous opinions that the power to tax is the power to destroy. That’s very true.
But it can also be said that the power to imprison is the power to destroy. The federal government is already too big, and too intrusive into our lives. The Founding Fathers designed a Constitution to limit the scope of government. It looks like the Court will have an opportunity to do so here. A decision is likely around March of 2010.