Court takes on federal anti-fraud law
APNews
Dec 08, 2009
The Supreme Court is considering whether to rein in federal prosecutors' use of a 28-word fraud law that has become a preferred tool in high-profile corporate crime and public corruption cases _ and a favorite target of critics.
The court is hearing three cases this term, including two Tuesday, in which defendants are challenging the use of the so-called honest services fraud law against them. The law makes it illegal for officials, executives and others to scheme to deprive those they serve and possibly others of "the intangible right to honest services."
The justices also are expected to issue their first opinions of the term, in cases argued in recent months.
In the fraud law issue, former newspaper mogul Conrad Black, who has served nearly 22 months of a 6 1/2-year prison term, and former Alaska legislator Bruce Weyhrauch, who has been indicted but not tried, are asking the court to throw out the prosecutions against them.
Former Enron CEO Jeffrey Skilling, convicted in 2006 on conspiracy, securities fraud, insider trading and lying to auditors involving the company's collapse in 2001, will have his case heard in spring. He attacks the law as unconstitutionally vague.
Prosecutors also have used the charge against former lobbyist Jack Abramoff and others caught up in that scandal. One former Illinois governor, George Ryan, was convicted of honest services fraud, and another, Rod Blagojevich, faces the same charge, among others.
Former Alabama Gov. Don Siegelman and ex-HealthSouth CEO Richard Scrushy also are appealing their honest services fraud convictions to the Supreme Court.
Critics of the law include the U.S. Chamber of Commerce and the National Association of Criminal Defense Lawyers.
The defendants appear to have a powerful ally on the court, Justice Antonin Scalia. Urging the court in February to take a case to resolve questions about the law, Scalia said it "invites abuse by headline-grabbing prosecutors in pursuit of local officials, state legislators and corporate CEOs who engage in any manner of unappealing or ethically questionable conduct."
Black and two other former executives were convicted of depriving the Hollinger International media empire of their faithful services as corporate officers. They say the honest services conviction must be overturned because they intended no economic harm to the company, which once owned the Chicago Sun-Times, the Daily Telegraph of London, the Jerusalem Post and hundreds of community papers across the United States and Canada.