…when compared to the Canadian criminal justice system. I don’t think the Americans, and others, will really be much impressed by this lengthy saga–and the inevitably derisory sentences that will follow:
Canada, long criticized for its dismal record on white-collar crime prosecutions, secured its first major victory Wednesday in the high-profile conviction of disgraced impresario Garth Drabinsky.
The fraud and forgery convictions, which follow a decade of investigation and pre-trial motions and hearings, are expected to help the country’s reputation overseas where it is perceived as weak on enforcement involving stock market and investment crimes.
“This is the first high-profile conviction [emphasis added]. It should show that corporate crime is taken seriously,” said veteran criminal lawyer Alan Gold of the two counts of fraud and single forgery convictions against Drabinsky as well as Myron Gottlieb, his former right-hand man at Livent Inc.
However, he said the impact will be muted by the 10 years it took to get the case from an initial investigation through to convictions.
His concern about the impact on justice of long delays in prosecuting cases in Canada is shared by corporate crime specialists, including the man who led the investigation into the accounting fraud that took place at Livent while the company was mounting well-known Broadway musicals such as Show Boat and Kiss of the Spider Woman.
“I really think it is a shame that it took this long,” said Craig Hannaford, a former commercial crime specialist at the Royal Canadian Mounted Police who was instrumental in bringing the charges against Drabinsky, Gottlieb and two other former Livent executives in 2002.
“That has to be fixed in this country. It just can’t take that long,” said Hannaford, who is now a private consultant.
He said the slow process has encouraged enforcement agencies outside the country, including the U.S. Department of Justice and the Securities and Exchange Commission, to move in on corporate misdeeds involving executives of Canadian-based companies such as Royal Group and Nortel.
“Are we looking now at another 10 years before those cases make it through the courts?” said Hannaford.
He also noted the compressed time frame [emphasis added] in the case of Conrad Black, the former CEO of Hollinger Inc. and its Chicago-based subsidiary, who was indicted in the U.S. two years after concerns were raised about his company. Two years after that, Black was sentenced to six years in a Florida prison.
Hannaford said he is concerned that Canada’s “very generous parole and release system” will result in a much lighter sentence [see this one! MC] for Drabinsky and his former Livent lieutenant, even if they are sentenced to as much as five years in jail for their crimes.
“I bet you the end result is less than a year of time — and that’s not deterrence at all,” he said.
Note also this:
While U.S. authorities have prosecuted a string of accounting fraud cases in recent years, including Enron Corp. and WorldCom Inc., Canada has had no major accounting frauds go to trial in many years. Major trials are pending involving former executives from Nortel Networks Corp. and Royal Group Technologies Inc.
“We’ve had plenty of accounting scandals, but we’re a bit short on trials,”..
And there’s a broader, er, systemic problem as Christie Blatchford bemoans:
…the federal Conservatives have the trees firmly in their elephant-gun sights, but remain steadfastly oblivious to the forest…
…everyone who works in the courts knows very well [what] is the real problem – the egregiously glacial pace of Canadian justice – but which no one much wants to discuss, let alone fix…
Take, for instance, Regina versus John Magno.
Mr. Magno was charged on Aug. 7, 2002, with second-degree murder (via a little-used section alleging the death was by way of “an unlawful object”) in connection with an infamous Christmas Day fire at the Woodbine Building Supply store the year before.
Seven years later, Mr. Magno’s trial has yet to even begin; fortunately for him, he spent only about two months in custody before being granted bail. The trial was slated to get under way this spring, but this week was delayed again; at the earliest, it could start in the fall, but it could also be as late as next year.
…Surely this is the problem Ottawa should be tackling…
Quite. And here’s an earlier post of mine on a related subject, especially regarding white-collar crime:
Some immodest proposals on federal policing