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DiminishedIndividualCulpability 3 - 04 Feb 2010 - Main.StephenSevero
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| | I just noticed this case that I thought presented an interesting take on individual culpability. If I understand the case properly, Butler sold people high risk subprime mortgages, claiming they were low-risk student loan backed (and I think we all realize how hard those are to default on). The interesting thing comes during sentencing - in giving Butler a below guideline sentence, Judge Weinstein noted that “The court imposed a non-guideline sentence, taking into account the defendant’s personal situation and characteristics and the circumstances of the financial industry in which he worked,” an industry with a "pernicious and pervasive culture of corruption" and "beset by avarice". While I understand the sentiment, it seems strange to reduce an individual's guilt because an entire system has played outside the bounds - particularly since he was actively defrauding people. Is this diffusing culpability throughout the system? Or claiming that if the bubble never burst, his fraud wouldn't have been 'that bad'?
http://www.dailyfinance.com/story/investing/the-message-in-a-crooked-brokers-reduced-sentence/19328974/?icid=main|aim|dl3|link5|http://www.dailyfinance.com/story/investing/the-message-in-a-crooked-brokers-reduced-sentence/19328974/ | | | This is interesting...I do think that's it's somewhat illogical to reduce one individual's sentence merely because he is part of a culpable system. But then again, don't judges often display leniency when sentencing based on background and circumstances? I'm wondering if the judge was purposely trying to avoid punishing one individual for the crimes of an entire system- and while that comes off looking like excusing him because of systemic failures, it might really be an avoidance of blatantly making an example out of him. Personally, I don't think a much longer sentence would be particularly beneficial in the way of deterrence- I think for financial crimes where the perpetrators generally think they won't get caught, the big effect here is that he did get caught and did get sentenced at all. If potential criminals would be deterred (if at all), I'm guessing the prospect of jail at all is deterrence enough. That all said, there's an issue of how much time he "deserves" for his crime- I personally find it really difficult to determine that kind of a number, so I honestly am unsure how to react to the sentence he actually was given. But I do think that punishing one for the crimes of many is not morally justifiable- and if leniency (within the bounds of judicial discretion) is the way to avoid this, perhaps it isn't so outrageous.
-- JessicaHallett - 03 Feb 2010 | |
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> | But isn't this more than just "not punishing him for the crimes of others" or "not making an example of him"? If the crime is fraud, which he was found guilty of, and the guideline suggests a sentence range (which was not significantly longer, but still), then isn't this reducing his punishment in light of the other crimes? Shouldn't that be just as troublesome as punishing him for the crimes of others? This wasn't merely the lowest guideline sentence, this was outside the bounds. This was even a year below the lowest sentence recommended by an advisory panel. And since I imagine a substantial percentage of criminals, particularly white collar criminals, have loving family members, I assume that the state of the industry is the primary factor.
Further, Butler was not required to pay restitution. "The extent of loss to Butler’s clients, if any, could not be calculated, in part because the investors defrauded were able to hold securities purchased through Butler that were impaired, but that might in time prove to possess some or all of the value of the original investments." So because they might recover, there is no present loss? Or just because they might recover, making him pay could be double compensation and faced with the choice between (with low probability) doubly compensated victims or (with high probability) uncompensated victims, we'll take the later? "It was noted, but not relied upon by the court in denying restitution, that Butler’s clients’ own conduct in failing to adequately supervise Butler and evaluate the nature of the securities purchased was a contributing factor in any losses they may have suffered." So they aren't really victims, because they should have known his fiduciary responsibility was compromised?
The sentencing is available here:
http://www.nylj.com/nylawyer/adgifs/decisions/012610weinstein.pdf
-- StephenSevero - 04 Feb 2010 |
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