DPAs and Eisinger’s “The Chickenshit Club”

Aug. 22, 2017, 12:32 p.m. | bgarrett

A recent New Yorker book review, of Jesse Eisinger’s new book, “The Chickenshit Club,” asks why didn't prosecutors target more executives after the financial crisis. Eisinger argues in a fascinating and readable book that it was a culture and policy shift among federal white-collar prosecutors. The review describes the rise of deferred prosecution agreements, documented on this Registry: “From 2002 to 2016, the Department of Justice entered into more than four hundred of these arrangements.” While the New Yorker did not, Eisinger himself carefully cites to that figure (419 such settlements as of his writing, from 2002 through fall 2016, as compared with 18 in the preceding ten years) from data collected as part of this Registry. Eisinger also notes an analysis of deferred and non-prosecution agreements, and whether employees were prosecuted, as well as examples from the Registry of corporations that have settled multiple criminal prosecutions in recent years. The book review concludes: “What had once been described as a badge of ignominy that could put a company out of business was now just a bit of unpleasantness: a passing hassle, like a parking ticket.” Now, I suspect the review did not mean to suggest that companies should be put out of business, but rather that the right individuals should be held accountable – and that companies should be held more seriously accountable. Far more can be said about what the terms of those agreements that settle corporate prosecutions look like – and whether they are effective. Moreover, the same questions exist not just in cases involving banks, but also all sorts of other types of corporations. However, Eisinger’s book (and the brief book review) raise provocative and important questions about priorities when prosecuting white-collar crime.