Introduced by Senator Leahy
(D-VT), the Public Corruption Prosecution Improvements Act of 2011 (S. 401), seeks to implement a massive number of changes to various federal criminal statutes. This bill is substantially similar to S. 49, introduced by Senator Leahy in the 111th Congress. During Senate Judiciary Committee mark-up of S. 401, the text of S. 995, the Public Officials Accountability Act, was added to the bill. This new version of S. 401 includes the following provisions of note:
- Extending the statute of limitations to six years for certain “serious public corruption offenses”;
- Modifying the federal mail and wire fraud statutes to apply to schemes to obtain “any other thing of value” in addition to the current law’s “money or property”;
- Amending 18 U.S.C. § 666(a) to lower the applicable monetary threshold from its current $5000 level to a $1000 level and increase the applicable criminal penalty from up to 10 years imprisonment to up to 15 years imprisonment;
- Increasing the maximum penalty for violations of 18 U.S.C. § 641 from a maximum of 10 years imprisonment to a maximum of 15 years imprisonment;
- Increasing the maximum penalty for violations of 18 U.S.C. 201(b) from a maximum of 15 years imprisonment to a maximum of 20 years imprisonment;
- Increasing the maximum penalties for a variety of public corruption related offenses (including 18 U.S.C. §§ 600, 601(a), 602(a), 606, 607(a)(2), and 610);
- Adding bribery, theft, and embezzlement of public funds to the predicates for RICO;
- Adding additional wiretap predicates to 18 U.S.C. § 2516(1)(c);
- Clarifying the language of the federal illegal gratuities statute (18 U.S.C. 201(a)); and
- Expanding venue for perjury and obstruction of justice proceedings.
In addition, by incorporating S. 995 into this bill, it now seeks to legislatively reverse the Supreme Court's decision in United States v. Skilling, which significantly limited the honest services fraud statute. The 24-year-old federal “honest services” fraud statute, 18 U.S.C. § 1346, makes it a federal crime to engage in a “scheme or artifice to defraud another of the intangible right of honest services.” The maximum term of incarceration for whatever conduct is deemed to violate this uncommonly broad prohibition is 20 years (or 30 years if the violation “affects” any financial institution). In June 2010, the Supreme Court held that the language of the “honest services” fraud statute is unconstitutionally vague and limited its reach to acts involving bribery or kickbacks. The Court rejected the government’s suggestion that it construe § 1346 to include officials or employees who take action to further their own financial interests.
This bill (like H.R. 1468 introduced by Rep. Weiner (D-NY)) would subject to the prohibition and penalties of § 1346 any public official or any officer or director of any publicly-traded corporation or private charity who is involved in a “scheme or artifice … to engage in undisclosed ... self-dealing.” The mental state (mens rea or “criminal intent”) that the government would have to prove is essentially undefined. Like the overbroad statute that the Supreme Court struck down, the uncommonly broad definitions of “undisclosed self-dealing” in this bill include, for example, “benefiting or furthering a financial interest of ... the public official ... [or] an individual, business, or organization with whom the public official is negotiating for, or has any arrangement concerning, prospective employment or financial compensation." The maximum penalty for violations would remain 20 years of imprisonment (or 30 years if the violation “affects” any financial institution).
Prior to the Senate Judiciary Committee mark-up and vote on S. 401, NACDL submitted a letter opposing the bill and outlining its serious flaws. This bill passed out of Judiciary Committee, however the four Senators who voted against the bill expressed many of the criticisms raised by NACDL's letter. Many of the provisions in S. 401 are similar to the provisions of the Clean Up Government Act, H.R. 1793 and H.R. 2572, which is currently pending in the House Committee on the Judiciary. NACDL's has published analysis and testimony opposing those bills as well. NACDL Board Member Timothy P. O'Toole previously testified on behalf of NACDL before the Senate Committee on the Judiciary regarding possible legislation in response to the Skilling decision. All of these materials are available below.
Legislative Update: The Senate Judiciary Committee voted to report S. 401 to the full Senate in July 2011. Six months later, on January 31, 2012, Senators Leahy and Cornyn introduced S.AMDT. 1483
to the STOCK Act (S. 2038) in an effort to enact their various stalled public
corruption proposals into law. The amendment was substantially similar
to the above bills and included an alleged Skilling-fix.
NACDL warned Senators of the dangerous nature of this amendment prior
to its introduction and again on February 1, 2012, prior to a vote on
the measure. Read those letters here.
S.AMDT. 1483 was ultimately added to the Senate version of the STOCK
Act but House leadership removed it from the version of the STOCK Act
the House passed on February 9, 2012. Read NACDL's Press Release on
that vote here.
No further action has been taken on these bills.
Resources on the Public Prosecution Improvements Act of 2011
NACDL Letter on S. 401, the Public Corruption Prosecutions
Improvements Act, and S. 995, the Public Officials Accountability Act
Written Statement of Timothy P. O'Toole on behalf of NACDL Before the Senate Committee on the Judiciary, Subcommittee on Crime, Terrorism, and Homeland Security on "Restoring Key Tools To Combat Fraud and Corruption After the Supreme Court's Skilling Decision"
Materials on the Clean Up Government Act of 2011 (H.R. 1793 & H.R. 2572)