Chapter 4: The Nigerian Barge Deal: No crime here, but people are going to prison.
In going over the indictment of Jim Brown and his colleagues, Ms. Powell noted that there were no real criminal offenses in the indictment. Instead, it cobbled together parts of different statutes to make up some kind of new crime that didn’t even make sense. The law is generally supposed to make sense. This is especially true for criminal law. “The Supreme Court has long insisted that ‘because of the seriousness of criminal penalties and because criminal punishment usually represents the moral condemnation of the community, legislatures and not courts should define criminal activity.’ Justice Oliver Wendell Holmes Jr wrote that US citizens are entitled to ‘fair warning…in language that the common world will understand of what the law intends to do if a certain line is passed. To make the warning fair, so far as possible, the line should be clear.’”
“Since when was it illegal for an employee to seek business for his company? When did the law require someone at Merrill Lynch to be responsible for the bookkeeping at Enron?”
Federal judges, especially at the district court level, want and expect to be able to believe that what the prosecutors say is true. The Supreme Court’s rule of Berger demands that the US attorney seek justice. Federal judges are loath to reverse a criminal conviction, and they rely on the prosecutors to do the right thing.
The whole point of this conviction hinged on a telephone conversation between Merrill Lynch and Fastow (but not including Jim Brown) in which Fastow supposedly got Merrill to back the purchase of some Nigerian barges, with the assurance that Enron would “use its best efforts” to get another party to purchase the barges within 6 months.
The “crime”, according to the prosecutors, was that Enron “guaranteed” a buy back which was ratified in that phone conversation through “code”. That made the sale a sham, and Enron could not legitimately book a “gain”. So in other words, they “cooked the books” According to the prosecutors, it didn’t matter that no one profited, or that none thought their conduct was unlawful. In a conspiracy charge, it didn’t matter that Brown wasn’t on the phone call. The situation would be laughable except for that fact that lives and futures of these families were being destroyed. In the grand jury, Weissmann had told Jim Brown to share his personal understanding, whether it was “accurate or not”, then indicted him for perjury and obstruction of justice for his answer.
In preparation for trial, the defense attorneys repeatedly asked for Brady material. The prosecutors produced only summaries of their witness interviews and repeatedly said they didn’t have any Brady material. Nothing they provided was admissible at trial and it would be years before anyone would uncover what they were hiding—Brady material they knew about but covered up that completely exonerated Brown.
The Barge trial was the task force’s next move toward convicting others and was one of the underpinnings of the Skilling-Lay (Enron) indictment. The ultimate prize would be their (Skilling & Lay) conviction.
- Tina Trinkle, of Merrill Lynch, testified falsely that the phone call promised Merrill Lynch a buy-back.
- Michael Kopper, Fastow’s protégé at Enron, made a deal with the prosecution for his testimony. He had destroyed his computer (obstruction of justice) and had stolen millions with Fastow, but received no charges. He also testified that the deal was a promise, not a “best-efforts”, even though he had told the FBI otherwise in their earlier questioning. Kopper was doing what he had been directed in order to avoid a prison term himself.
- The prosecution’s star witness was Ben Glisan, former Enron Treasurer. He had gone to prison for refusing to cooperate, and had been put into solitary confinement—the hole—a bug-infested cage barely big enough to stand in, with only a slit for light. From there he was moved to a high-security facility which he wasn’t expecting. When he was brought to the grand jury, he was ready to join the task force orchestra—first chair. He also testified to the “promise” rather than a “best-effort”.
- Kathy Zrike, Merrill Lynch’s corporate counsel, had not been interviewed by defense counsel because she had refused to talk to them. She was under threat of indictment by Weissmann. But she was called as a defense witness. During her testimony, Weissmann sat in front of her, glaring and taking notes. She had agreed to the non-prosecution agreement that obligated her to testify consistently with the government. Led by the prosecution during their cross, Ms. Zrike put the icing on the inevitable cake.
So here we have a “parting of the way”. In years past prosecutors had been trusted to do what is right and legal, only charging people who were definitely guilty of knowingly committing a crime. And now we have a group of overzealous US attorneys on this task force who are using that screen to create laws and charge innocent people for breaking them. It didn’t matter that what the person did wasn’t even illegal, or that they didn’t know they were breaking any law.
This has now become the rule in the courts, especially pertaining to the area of medicine and the prescribing of controlled drugs. Doctors are prescribing without realizing that the DOJ has created “laws” in the courtroom for which the doctors will be charged. Doctors believe the actual law as written by the legislature, that as long as they are prescribing medicine in their office for a documented medical problem, that they are safe. But they aren’t. We have to change that, through every means available:
1. Stop convicting doctors in court
2. Get the legislature to state unequivocally that a doctor is exempt from criminal attack based on Title 21, the Controlled Substance Act.
Another problem evidenced here: the elimination of defense witnesses by the prosecution. I don’t know how long these practices have occurred. They probably go back decades. But we need to change this. Prosecutors are threatening witnesses until they commit perjury. Or, like in Mr. Glisen’s case, they are treated so harshly they cave. In the case of doctors, everyone who works in the office is declared a “government witness”. That means that the doctor can’t even talk about the case with his own employees or associates. The people in the office are threatened to give testimony that the prosecution wants, or they face indictment. In my case, my nurse was grilled in interrogation for 6 hours, threatened with prison if she didn’t testify to the lies they told her to. She was strong, even though she suffered from fibromyalgia herself, and the stress really caused her health to crash. She refused to commit perjury. But I still couldn’t use her as a witness either. The government just put her on the stand as their witness, got her personal information, and let her go. So she ended up not saying anything that hurt me, but couldn’t say anything to help either. That was because my defense attorney, Rhonda Quesenberry, was in the prosecutor’s pocket. She never talked to any of their witnesses (even though she told me she tried to—she lied), so at cross she just said “No questions”.
The only way that I can see to change this is that the defender in any case should have first dibs at the witnesses. Then, once they are defense witnesses, the prosecution can only talk to them in the presence of the defense attorney (just like it is now with prosecution witnesses, but reversed.) That would prevent the forcing of witnesses to lie by prosecutors or their agents through threats or intimidation. Hopefully the truth would win.
However, the doctor working in my office to take care of the pain patients needing controlled drugs did cave under threat. Not being able to talk to her before or during the trial, I didn’t know. After the trial my lawyer gave me permission to talk to her (and other witnesses) to prepare for the sentencing by getting their character references. In talking to Dr. Schultz, I found out that the government agents continuously visited with her, coached her on what to say, forcing her to lie under threat of indictment. So she perjured herself. Upon finding out that I had talked with her and found out what the prosecution did, my judge (Glen Conrad) got angry, and actually charged me with obstruction of justice, adding more time to my sentence. He said, to cover up the fact that the prosecution forced a witness to lie, that I was not to talk to witnesses until after the sentencing, that a pre-trial bond does not stop at the trial, but extends to the sentencing. Even though I had the email from my lawyer showing she had given me permission, she declared client/attorney privilege, and the judge refused to look at it. They all cover each other’s butt.