How America should be addressing its ‘dirty money’ problem around white-collar crimes, according to a legal scholar

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  • Jennifer Taub is a legal scholar and advocate who’s testified as a banking law expert before Congress and appeared on MSNBC and CNN. 
  • The following is an excerpt from her new book, “BIG DIRTY MONEY: The Shocking Injustice And Unseen Cost of White Collar Crime.”
  • In it, she examines white collar crime, its history, and why these offenders fail to face the consequences that street level criminals do from Congress and the Supreme Court.
  • She explains how the country’s biggest crimes — like the financial crisis in 2008 to the ongoing opioid epidemic — have taken a toll in its citizens on a systematic level and the US can do better moving forward. 
  • Visit Business Insider’s homepage for more stories.

America, we have a big dirty money problem.

The corporate crime, elite impunity, and public corruption disease did not infect us overnight, though. We’ve been exposed now for so very long that we are almost immune. Almost.

If you still get angry when you see prosperous predators get away with it, we still have a chance to fight back. I’m ready to speak up about what’s broken and promote specific, significant, and enduring fixes. At the end of this chapter, following these proposed solutions, I’ll explain why and how you can join this effort.

You don’t need a law degree or a lobbyist’s contact list to exert influence. There are more honest people in America who believe that when we get big money out of politics and when big businesses and the elite are made to obey the law, we are all safer and our society is more just. 

text: "BIG DIRTY MONEY: The Shocking Injustice And Unseen Cost of White Collar Crime," By Jennifer Taub. Courtesy of Penguin Random House

© Courtesy of Penguin Random House
“BIG DIRTY MONEY: The Shocking Injustice And Unseen Cost of White Collar Crime,” By Jennifer Taub. Courtesy of Penguin Random House

In a nutshell, here’s the problem:

The extremely wealthy and well connected have incentives and opportunities for crime and corruption. Absolute power corrupts absolutely.


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Extreme wealth is criminogenic and members of the upper classes provide one another with a kind of mutually assured immunity. It’s difficult for law enforcement with comparatively limited resources to intervene.

Prosecutors also have insufficient incentives to pursue complex and time-consuming cases against respectable high-status individuals and business entities. And the tools they have to detect and punish offenders have been dulled by the courts.

Furthermore, the urgency to prioritize white collar crime is low when it’s hard for the public to see the victims.

Our most powerful counterweights are whistleblowers and journalists. Yet they lack the protection and financial support they need.

Finally, we have incomplete and inconsistent data available on the amount and nature of white collar crime and white collar offenders. So what are the corresponding solutions? 

Cleaning up the mess

First, we should create and fund a new division within the Justice Department to focus on detecting, prosecuting, convicting, and incarcerating big money criminals. This elite crime division should monitor the usual suspects so as to prevent crime where the incentives and opportunities are most prevalent.

It’s absurd that the same corporations face serious criminal or civil investigations and then reoffend again and again — often under the same leadership. Thus, a high priority of this new division should be to end the dependence on deferred prosecution and nonprosecution agreements. These DPAs and NPAs with large corporate offenders should not be allowed unless responsible high-level executives are prosecuted.

If no one at the top is responsible, then the corporation itself if guilty should face criminal charges and a trial where witnesses testify and the public can learn of the misdeeds. 

As Nobel laureates George Akerlof and Robert Shiller explain in their book “Phishing for Phools,” “If business people behave in the purely selfish and self- serving way that economic theory assumes, our free-market system tends to spawn manipulation and deception.”

The only way to stop their behavior is through sure and painful enforcement. Take their money, take their liberty, set an example.

Success for prosecutors should be measured not by the number of cases closed, but instead by the scope of the harm and the number of victims helped by pursuing the matter. Implementation of this policy would recognize that white collar crime should be treated as seriously as organized crime. This division would have devoted funding, specially assigned attorneys, dedicated FBI agents, and support staff. It would focus on securing compliance with the law by bringing meaningful, complex cases against powerful offenders. It would take on large-scale firms where new and dangerous products and complicated regulations exist. It would also monitor marketing and new developments and bring early cases to stave off emerging threats before they develop into industry practices.

The division would work closely with devoted contacts within the enforcement divisions of the major federal administrative agencies. Instead of waiting for referrals, it would proactively research and anticipate businesses under stress that might choose to cut corners or engage in a race to the bottom. 

Second, we need to empower and encourage law enforcement to take on those difficult and time-consuming cases involving elite offenders and large businesses. To do so, we must amend some of the federal laws that have been weakened by the courts. This includes our antibribery statute. The law prohibiting bribery of public officials must be updated to create an outright ban on any gift giving to or acceptance of gifts by members of Congress above a specific low- dollar threshold. 

We also need to make it easier for law enforcement to trace money laundering, and make it harder for natural persons to hide behind shell companies formed in highly secretive jurisdictions, including Delaware.

Toward this end, Congress should enact the Corporate Transparency Act, which has already passed in the House. It would require corporations, LLCs, and other business entities that appear to be shells (such as those that have few to no employees) to disclose, on an ongoing basis, their beneficial owners to the Treasury Department’s Financial Crimes Enforcement Network (FinCEN). This will help detect money laundering and tax evasion schemes.

In addition, federal prosecutors should be better trained in the use of the responsible corporate officer doctrine to hold criminally accountable those executives who are in a position to affect the health and safety of the public. 

Third, we need to create more visibility and protections for victims of white collar crime. Toward this goal, we should create a nationwide registry for white collar criminal offenders. That way, before engaging in consumer or business transactions, ordinary people can consult the registry. This is similar to the concept of a sex offender registry, but given that white collar crime cases are typically prosecuted at the federal level, and offenders can live one place and use internet, mail, and telephone to target people across the country, it should be centralized. 

In addition, Congress should amend the Crime Victims’ Rights Act of 2004 to make it more accessible to people harmed by white collar crime. Surviving family members of those who got hooked on opioids because of OxyContin, for example, should be informed before any government settlement.

On tax evasion, imagine the impact if, in a tax fraud sentencing, a voice were given to those who depend upon public funds, such as mayors, town governments, citizens, or school boards. In addition to a voice, victims also need social safety nets. We cannot expect everyone to be fully compensated by offenders through civil and criminal settlements.

Everything from extended unemployment insurance to Medicare for All helps those who have lost their savings to fraudsters, or lost their jobs because they chose to leave a corrupt business or spoke out against its criminal practices and were fired.

Fourth, we need to protect and support both independent investigative journalists and whistleblowers. Independent journalists perform the difficult research that law enforcement under political pressure or other constraints cannot always perform. They shed light on major social problems and help rouse and rally the public to demand change. Yet they are under financial and physical threat. Congress should allocate funds to independent investigative journalist organizations that agree to share their research with newsrooms nationwide after initial publication so they can build on their work. 

We also need to empower whistleblowers, not just protect them from retaliation. Presently, under the qui tam provisions of the False Claims Act, we give whistleblowers special standing to directly sue contractors that are defrauding the federal government; the government can then choose to intervene and take over the matter and the whistleblower receives a portion of the recovery.

Congress should expand this to provide standing to whistleblowers for a wider range of white collar crimes. Also, Congress should ban forced arbitration for both employment and consumer legal disputes. This will give employees and consumers their day in court and let sunlight disinfect workplaces and businesses. 

Fifth, we must restore funding to the IRS so it can recover money that goes uncollected due to understaffing. The agency must close the estimated $800 billion “tax gap” — the difference between what the IRS believes it is owed and the tax receipts it actually collects.

In addition, with more staff, the IRS can avoid the problem of having to let so many delinquent accounts go uncollected due to expiration. Also, Congress should close the glaring loopholes in the tax code and also create a more equitable system, including a wealth tax, to help decrease the vast income inequality that makes so many of the uber- wealthy above the law in the first place. 

And sixth, we need to improve data collection across all law enforcement agencies nationwide that report through the FBI’s Uniform Crime Reporting system. We need to be able to track all criminal offenses, including designated white collar offenses, the income and assets of the alleged offenders, and the estimated financial losses involved.

Further, there needs to be one centralized database to track to their final disposition the numbers and types of all civil charges and settlements by all federal agencies, even where these cases do not result in referrals for criminal prosecution by the Justice Department.

Meeting the challenge

A hundred years ago, progressive legal reformer Louis Brandeis wrote, “Sunlight is said to be the best of disinfectants; electric light the most efficient policeman.” But today, to clean up this white collar crime epidemic, we need more than vision. Today the crime today is hiding in plain sight. Now we need to use our voices.

As abolitionist Frederick Douglass proclaimed in 1857, “Power concedes nothing without a demand. It never did and it never will.”

It’s time to demand an end to this elite crime spree. We must act, and not just for us, but for the society that will be here generations to come. We owe it to our children and grandchildren. And we owe it to the people who have come before us, like journalist Daphne Caruana Galizia.

The last two sentences of her final blog post were: “There are crooks everywhere you look now. The situation is desperate.” May her memory be a call to action. 

From “BIG DIRTY MONEY” by Jennifer Taub, published by Viking, an imprint of Penguin Publishing Group, a division of Penguin Random House, LLC. Copyright © 2020 by Jennifer Taub.

a woman smiling for the camera: Jennifer Taub. Jill Greenberg

© Jill Greenberg
Jennifer Taub. Jill Greenberg

Jennifer Taub is a legal scholar and advocate whose writing focuses on “follow the money” matters — promoting transparency and opposing corruption. She has testified as a banking law expert before Congress and has appeared on MSNBC’s Morning Joe and CNN’s Newsroom. Taub was the Bruce W. Nichols Visiting Professor of Law in fall 2019 at Harvard Law School and is now a professor of law at the Western New England University School of Law. A former associate general counsel at Fidelity Investments, she is a graduate of Yale College and Harvard Law School.

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