Judiciary Committees to Probe Corporate Monitors Following Ashcroft Deal
Posted Jan 15, 2008 7:39 AM CDT
By Debra Cassens Weiss
The House and Senate judiciary committees are seeking more information about the appointment of corporate monitors amid questions about whether prosecutors are rewarding political pals with the lucrative work.
The move comes after news reports that the Justice Department is investigating a no-bid contract for monitoring work awarded to the consulting firm of former Attorney General John Ashcroft, reportedly at the direction of U.S. Attorney Christopher Christie of New Jersey.
Companies often can avoid prosecution for fraud and corruption by agreeing to pay for a corporate monitor. Some prosecutors give companies little say in the selection of monitors, while others allow company input, the Washington Post reports. Corporate monitor fees can cost tens of millions of dollars, but companies rarely object because they don’t want to anger prosecutors.
Over the last several years, federal prosecutors in Alabama, New York and Virginia have hired corporate monitors who are ex-prosecutors or former officials with the Securities and Exchange Commission with ties to President Bush or other top Republicans, the story says. Other monitors have Democratic backgrounds, including former Manhattan prosecutor David Kelley and former Justice Department officials James Robinson and James Cole.
Christie’s involvement in monitoring deals is drawing the sharpest criticism, the story says. In one case, Bristol-Myers Squibb resolved accounting charges in part by funding a professorship at Seton Hall law school, Christie’s alma mater.
A Christie spokesman, Michael Drewniak, said Christie had chosen monitors he knows and trusts, and has received no complaints about their work. He also said it was Bristol-Myers’ idea to endow a law school seat.
Ashcroft defended his monitoring deal. "We have a cooperative agreement between prosecutors and a vital industry, and the expense is born by the industry and not the public," he told the Post. "What's wrong with that picture? There isn't anything wrong with that picture."