Denny Hastert is Contemptible, But His Indictment Exemplifies America’s Over-Criminalization

[damnedifIknow]

Bush-era House Speaker Denny Hastert, who was indicted yesterday, is a living, breathing embodiment of everything sleazy and wrong with U.S. politics. That is highlighted not only by his central role in enabling every War on Terror excess, but also by this fact:

Hastert’s ability to make such large cash payments probably came from his career as a K Street lobbyist. He entered Congress in 1987 with a net worth of no more than $270,000 and then exited worth somewhere between $4 million and $17 million, according to congressional disclosure documents."

Hastert is about the least sympathetic figure one can imagine. Beyond his above-listed sins, he shepherded the 2001 enactment and 2005 renewal of the Patriot Act, whose banking provisions, in sweet irony, seemed to have played a key role in his detection and in creating the crime of which he stands accused. His long record in Congress involved, among many things, denying equal rights to people based on the “Family Values” tripe, as well as continually supporting ever-increasing penalties and always-diminished rights for criminal defendants. So he’s reaping what he sowed."

*Radley Balko, who has done among the best work on the broken U.S. criminal justice system, said this morning: “Dennis Hastert is one of the last people I want to be defending. But these charges are the picture of over-criminalization run amok.”

*Long-time appellate judge Alex Kozinski co-authored an essay entitled “You’re (Probably) a Federal Criminal,” noting how easy it is to become a felon. “Most Americans are criminals, and don’t know it, or suspect that they are but believe they’ll never get prosecuted … Violations are so common that any attempt to go after all criminals would sweep up millions of people.”

https://firstlook.org/theintercept/2015/05/29/denny-hastert-highly-unsympathetic-face-americas-criminalization-pathology/

[mgcgulfcoast]

1. Im wondering why the blackmailer

isnt being prosecuted.

[FarPoint]

2. I thought of that question too.

Definitely more to this story.

[DrDan]

6. because there has to be a victim - and denny has not made that claim

[Vinca]

12. Because it might not be blackmail.

It could be Denny got wind of a book someone was writing or something else and approached his victim and offered a settlement in lieu of publicity. You would have to have evidence that the victim told Denny he'd have to pay up or else.

[JustABozoOnThisBus]

17. I wonder if "person A" reported the payments as income

It might not be blackmail, but I'd bet it's tax evasion.

[yellowcanine]

24. And it is still possible that Denny will plead and make a deal.

His reputation will probably be in shreds but he may avoid any prison time.

[JustABozoOnThisBus]

27. His reputation (such as it was) is in shreds ...

... because of something that happened decades ago, something that is not yet public knowledge, something that the statute of limitations ran out on.

The current charges have more to do with financial transaction reporting, crimes so bleachy-white-collar that most of us don't understand what the big deal is. No hits to his reputation on this score.

But, again the IRS, Denny may not have notified the IRS about the payments to Person A, via Form 1099 or whatever mechanism is appropriate (I am not a tax expert). So in addition to the banking crime, there may be tax crime. Again, as far as reputation goes, meh.

Denny is toast. But I wonder about Person A, whether he (or she) will end up being charged for recent wrongdoing.

[Vinca]

35. I wondered about that, too.

I imagine if he hasn't declared it, the IRS will be after him, too.

[jberryhill]

38. Depends on the terms of the agreement

http://www.democraticunderground.com/?com=view_post&forum=1002&pid=6777701

[jberryhill]

14. Insufficient evidence

It was apparently not clear to investigators of what, precisely, the deal consisted.

If you have a civil claim against me, then I can certainly agree to pay you in settlement of that claim and we can further agree that you will not make any public statements about that claim.

In general, if I agree not to report a crime you have committed in exchange for payment, then that would be a form of illegal extortion.

For example, this is the federal blackmail statute:

----
18 U.S. Code § 873

Whoever, under a threat of informing, or as a consideration for not informing, against any violation of any law of the United States, demands or receives any money or other valuable thing, shall be fined under this title or imprisoned not more than one year, or both.
----

Okay, so here's the scenario.

You kill your spouse and you are driving down the road with the body in the trunk, on your way to hide the body somewhere. You blow through a stop sign, hit my car, and your trunk lid flies open. I get out of my car to inspect the damage, and I see the dead body in your trunk before you hastily close it.

One of these things now happens:

1. I look at you, smile, and say, "Looks like you did some damage to my car, and I think my neck hurts. I'll tell you what, though, I think $100,000 ought to take care of it, that will be the end of it, and I will agree not to make any claims about what happened." You agree to pay me the $100,000

2. I look at you, smile, and say, "If you give me $100,000, I won't tell the police about the dead body in your trunk." You agree to pay me the $100,000.

#1 is perfectly legal. #2 is not.

Now, of course, where it gets fuzzy is the implied understanding in situation #1. But in order to prove that I made an illegal proposition, you need evidence that just isn't there. There is no general duty to report crimes to the police.

In the Hastert situation, there is also the problem of when the deal was made. My limited understanding is that the statute of limitations is long past for prosecution of the offense underlying the whole thing, and so reporting that crime would be of no effect.

Clearly, Hastert was probably not forthcoming in the particulars of whatever deal was made, and just as clearly the person receiving the payments has a 5th Amendment right not to answer questions about it (which is what Hastert should have asserted when asked about the withdrawals in the first place - he had no obligation to tell them what he was doing with the money, but he lied instead).

The takeaway is this - if you are being questioned by law enforcement about something you've done, even when you know what you've done is perfectly legal (and it is not illegal to withdraw money from your own bank account), then answering questions does not help you. They are not asking you questions in order to help you. They are asking questions in order to obtain statements to be used against you. If you don't want to answer a question, you are much better off saying that you don't want to answer the question than to make something up. Because, and again, even if you are doing nothing illegal in the first place, you will be doing something illegal when you lie to them.

But while it is possible that the recipient of the payments was doing something illegal, there's no good way to get sufficient evidence to show that here.

[JustABozoOnThisBus]

29. Tax question:

Let's say we reached one of your two agreements. If I give you the $100,000, do I need to report the payment, probably on some kind of IRS Form 1099? And, you have to report it as ordinary income?

If I don't provide a form 1099, am I breaking a tax law?

If you don't report the income, are you breaking a tax law?

[jberryhill]

32. 1099's are for independent contractors

No, if I settle a legal claim with you, I don't need to provide a 1099.

Whether it is taxable on the recipient's end is a much more complicated question which, again, goes to "what was the deal for?"

Settlements received on personal injury claims are generally not taxable, but if you want to dig into the wrinkles of that, this is a good summary:

http://www.meehanboyle.com/taxation-of-judgments-and-settlements/

The relevant portion of the tax code is:

https://www.law.cornell.edu/uscode/text/26/104

----

(a) In general
Except in the case of amounts attributable to (and not in excess of) deductions allowed under section 213 (relating to medical, etc., expenses) for any prior taxable year, gross income does not include—
...
(2) the amount of any damages (other than punitive damages) received (whether by suit or agreement and whether as lump sums or as periodic payments) on account of personal physical injuries or physical sickness;

-----


Now, it refers to "physical sickness", but a lot of things can manifest as physical sickness.

But this all presumes that the recipient wasn't paying taxes on it, which we don't know. More broadly, one pays taxes on all one's income, unless it is excluded for some reason stated in the code. The IRS doesn't care how you made your money. If you sell heroin, then you report your income, pay your taxes, and you are Jake with the IRS.

[JustABozoOnThisBus]

36. Thanks! Good clear answer. nt

[jberryhill]

39. Timing also matters

You can amend your tax returns for up to three years post-filing. That doesn't necessarily deal with deliberate falsification of the filed return, but the IRS does have a voluntary disclosure program for people who have misreported their income and have since "come to Jesus". I'm not familiar with that program in detail. This is not legal advice.

[malaise]

3. Good - he and his goons wanted over-criminalization for ordinary people

I don't give a flying fugg because just like Bush and Cheney, I expect him to walk.

Check out who owns the private prisons. I am just waiting for the day the people get a chance to lock them all up for criminality.

[daleanime]

7. Agreed, but let's also use this to keep the conversation going.....

prisoners for profit has to end.

[malaise]

18. On that we agree

I'd also like to see the discussion of how these greedy politicians enrich themselves at the expense of their constituents as they sell out to corporate interests or loot public land.

[FSogol]

4. BS. Hasert thinks he's above laws he helped write. Sounds like Karma to me. n/t

[bemildred]

5. Hastert is being made an example of.

There is an election coming, and our criminal justice system is not in good repute these days either. FIFA was suddenly noticed to be corrupt too, just don't expect them to go after any of the bankers.

[daleanime]

8. +1

[The Wizard]

9. One of the things we do as a culture

is overreact to every tragedy and issue. Mandatory sentencing for instance takes the Judge, the person assigned to pass judgement, out of the equation, regardless of mitigating circumstances. Our prisons are bursting at the seams, and we squander far too many resources chasing and jailing people because politicians win elections because of the false perception that they're tough on crime when the reality is they're tough on fear and superstition.
Fear is a great motivator when it comes to elections. That's why Pox News has such an undue influence over the easily duped and fearful. Ever notice how quick we are to have a war on everything we are led to believe is a threat, real or imagined?

[valerief]

26. We don't have wars on everything. The puppetmasters do! nt

[Jesus Malverde]

10. It's quite possible that like many other congressmen the bush cabal knew about his dirty secrets.

Possible he went along to avoid being destroyed.

It's been documented the NSA spied on congress.

You don't think Cheney would use all the tools at his disposal for political advantage. Like a page out of j Edgar's handbook. No surprise mueller lasted as long as he did through multiple admins.

Sometimes we scratch our heads at how someone votes, we all have secrets.

[Cryptoad]

11. Poor Poor Hastert!

So we have come to this ,,,,, defending perverts! geeeez

[Vinca]

13. All Denny had to do was tell the truth . . . and he didn't.

He could easily have said the money transfer was to settle a claim for damages and nothing more. He never had to indicate he was a sexual predator, he just had to tell the truth.

[Nitram]

15. Why is Hastert's indictment an example of over-criminalization?

I don't follow.

[EL34x4]

25. The Atlantic summed it up nicely:

"The alarming aspect of this case is the fact that an American is ultimately being prosecuted for the crime of evading federal government surveillance.

That has implications for all of us."

http://www.theatlantic.com/politics/archive/2015/06/when-evading-government-spying-is-a-crime/394640/

[Nitram]

37. I'm afraid that's a bit disingenuous.

It is not at all unusual to charge someone for a related crime if it would be difficult to prove a more serious crime (or the Statute of Limitations has passed). The actual crime was molesting a young man who subsequently blackmailed him. Hastert broke the law by trying to hide the size of his bank withdrawals by withdrawing smaller amounts many many times. You might remember that Al Capone was jailed for tax evasion, not murder.

[jberryhill]

16. It doesn't matter

If some city somewhere had a death penalty for jaywalking, then nobody is going to care if someone otherwise odious is charged and executed for jaywalking.

It's that way with a lot of laws. In this instance, any observation along the lines of "how can you be charged with a crime for withdrawing money from your own bank account for a lawful purpose" equates to "Oh, so you are defending a pedophile now?"

Oddly, nobody says, "Oh so you are defending a rapist" in the context of reading someone their "Miranda rights" when a suspect is arrested. I'd bet that practically nobody at DU knows what Ernesto Miranda actually did, and of which he was convicted even when his self-incriminating statements were excluded from evidence.

Whether or not a law, or its enforcement, is reasonable, is simply not an objective question. Most people, and that includes most people on DU, are going to want to know who is being charged. The most handy example of that in regular action here at DU is the situation with Julian Assange and the Swedish criminal procedure. Whether or not Swedish laws on sex crimes, or Swedish prosecution mechanism are, or are not reasonable, is entirely dependent on what you think of Julian Assange in the first place. Observing those threads, that is the only distinguishing factor among participants.

[Bluenorthwest]

19. I do not agree. Let's review. Hastert exits the House early, as former Speaker he is entitled to a

40k a month budget to maintain an office for 5 years. Hastert opens such an office, the bulk of the budget spent on 'salaries'. At the same time, Hastert engages in major league high dollar lobbying of the Congress he just left. Questions are raised about the use of the tax payer funded office and the color of authority that comes with it in his Lobbying business. Attention is drawn. Hastert becomes a lobbyist for the Turkish government and organizes a trip to Turkey for current Members of Congress on which Hastert accompanies them. That sort of lobbying comes with a great deal of regulation, and just as with the use of his office, many questions were raised about the propriety of his actions.
Now. Hastert started taking large amounts of cash out of the bank in yes, a furtive manner shortly after the end of his 40K a month revenue stream from the taxpayers.

I am simply not persuaded that officials should be able to leave high office, take massive office budgets, open lobbying groups to represent foreign governments, flout or push many rules and regulations and expect to not have any inspection from the People. He's not some guy. His post Congressional occupation was not just some gig.
To take a man like that and claim his actions are common to millions of people is pretty disgusting actually, even if perfectly legal Hastert's income streams, the nature of his work, and the massive amounts of money he was gaining are not at all common.

What you are saying is Boehner resigns today, he should be able to lobby and run offices and take officials on trips and move masses of cash around and to even make note of his actions is somehow wrong because such officials should have impunity?
I really do not get this routine of pushing fat cat ex official Lobbyists as if they were 'millions of Americans'.

[yellowcanine]

23. Yes but then make all of that insider profiteering illegal rather than setting up all of these

other financial reporting requirements which end up catching a lot of individuals who just happen to have to work with large sums of cash because of the nature of their businesses. In other words, focus on the influence peddling and leave legitimate businesses alone.

[valerief]

30. The people who can make it illegal are the ones profitting from it now. nt

[Jim Lane]

33. The reporting requirements aren't some form of entrapment.

I have no problem with "reporting requirements which end up catching a lot of individuals who just happen to have to work with large sums of cash...." You just give the financial institution your SSN and know that a report is being filed: "On June 4, he came to our bank and withdrew $40k in cash." No big deal.

If instead you go to the bank on consecutive days and withdraw $9k, $9k, $9k, $9k, and $4k, so as to evade the reporting requirement, then you've committed a felony. Just don't do that and you'll be fine.

I've also had the experience that a bank official gets nervous and asks me why I'm dealing in large amounts of cash. The bank doesn't want the government to accuse them of helping a drug dealer launder money or whatever. In my case, it was a minor inconvenience. It took me a few minutes to pull together copies of the paperwork related to the legitimate business dealings that were going on. I brought the documentation to the bank. The bank officer reviewed it and pronounced himself satisfied. Problem solved.

I agree with Greenwald's general point about overcriminalization but I think these particular laws make sense.

[Rex]

20. I am having a hard time feeling sorry for Denny.

Fuck Hastert, the lying sack of shit deserves to rot in prison.

[damnedifIknow]

41. Agreed

I do worry about the over-criminalization problem though.

[Rex]

42. It is an issue that needs to be dealt with, along with the really stupid laws

that send non-violent drug offenders to jail for decades.

[NightWatcher]

21. Al Capone got busted for tax evasion. Ted Bundy, caught by a parking ticket.

I don't care how the asshole gets caught.

[yellowcanine]

22. Actually for a lot of reasons the Feds have an interest in why he was hiding the payments.

What were the payments for? Was he paying somebody for working for him, for example and avoiding withholding income and SS taxes? Or is he flat out giving large sums of money to someone and not reporting it to the IRS, thus enabling that person to avoid taxes? Is he supporting terrorists? If some is hiding large cash transactions, it raises questions. It was legitimate for the Feds to ask him about the transactions. If he really had been just hiding the cash under the mattress there would have been no problem. But he lied about that so suddenly there is a problem. He could have hid behind the 5th Amendment and then the Feds would have had to prove their case or let him go. But since he lied they have him on that.

FWIW I don't think that withdrawing smaller than $10,000 from the bank to avoid the reporting requirement should be a crime at all.
In fact I don't think there should be a reporting requirement for withdrawing large sums. The bank has the records of the transactions. If the Feds have probable cause they can go to a judge and get a subpoena for the records. Paying large sums in cash to an individual could be that probable cause but the Feds should still have to present what evidence they have to a judge. Denny slit his own throat by putting the financial reporting requirements into the Patriot Act. There is some sweet justice in that I guess.

[Orsino]

28. Hastert's career also exemplifies the legalization of corruption. n/t

[Johonny]

31. Banking... one place I'm okay with tough laws

Follow the money, you can't do it without laws. The article seems to equate small felonies with the kind of laws used to catch big fish moving big money around. It doesn't add up to me, sorry. These are the laws we want to have.

Hastert knew damn well that he was violating the law.

[Comrade Grumpy]

34. Radley Balko is correct. Hastert's "crimes" are non-crimes.

1. Trying to have privacy in his financial dealings.
2. Not admitting it to the FBI.

He is not accused of actually doing anything to anybody.

[krawhitham]

40. Did he or did he not lie to the FBI?

Seems like a simple rule to follow