White-collar crime often goes unpunished

WASHINGTON — White-collar criminals have failed to pay hundreds of millions of dollars in fines and restitution while continuing to live in luxury, congressional investigators say.

A Government Accountability Office study released Thursday is the latest in a series pointing to problems with the Justice Department’s attempts to ensure criminals pay their penalties.

The latest investigation looked at five cases that resulted in $568 million in penalties and found only about $40 million actually was paid.

Because these are ongoing cases, the report did not identify the offenders or give much detail about the cases. All were either high-ranking officials of companies or operated their own business. They pleaded guilty in each instance.

Besides restitution, prison terms for four offenders ranged from one to five years, followed by up to five years of supervised release. One offender received several years of probation rather than prison. As of June, all were out of prison or off probation, but three were still on supervised release.

All five were wealthy, or appeared to be, before the judgments, the GAO said, but they claimed later they did not have the money to pay full restitution to their victims.

Still, several continued living in million-dollar homes, and two took overseas trips while on supervised release, the report said.

Prospects are poor for collecting additional restitution in these cases, the GAO said, because so much time passed between their crimes and the judgment — five to 13 years.

The report said the offenders were able to hide their assets before penalties were established and there is not much incentive to go after them because willfully failing to pay restitution is not a crime in itself.

The report follows two others by the GAO. In July 2001, the office reported on the growth of criminal debt and pointed out inadequacies in the collection system.

A year ago, a follow-up report found the Justice Department had implemented half the recommendations of the previous inquiry but lagged in coordinating debt-collection efforts with other agencies. The department says it is organizing an interagency joint task force.

Sen. Byron Dorgan, D-N.D., called Thursday for immediate action by Attorney General Alberto Gonzales.

“Being tough on crime doesn’t mean very much if we aren’t serious about enforcing court-ordered fines and restitution,” Dorgan said. “We simply must do better.”