The Chronicle’s Mary Flood reports that Lea Fastow — who served a longer sentence under harsher conditions because of her marriage to former Enron CFO Andrew Fastow — was released to a halfway house from the Federal Detention Center in downtown Houston today. She is scheduled to be released from the halfway house on July 11.

Although U.S. District Judge David Hittner’s handling of the Lea Fastow case has received the most media attention, the case is really a prime example of the Enron Task Force’s lack of prosecutorial discretion and heavy-handed plea bargaining tactics.

In reality, Judge Hittner simply never appeared comfortable with the Task Force’s indictment of Mrs. Fastow. The indictment was a blatant move to place pressure on Mr. Fastow to cop a plea and cooperate with the prosecution, which he eventually did.

During Mrs. Fastow’s sentencing, Judge Hittner harshly criticized prosecutors for vacillating between an original indictment of six felonies and a final charge of just one misdemeanor, suggesting that justice may not have been served in either instance.

“Such maneuvering as is present in this case might be seen as a blatant manipulation of the justice system,” Judge Hittner stated on the record.

Yale law professor John Langbein, who has written extensively regarding prosecutorial abuse of the American plea bargaining system, identifies the problem in the following manner:

“Plea bargaining concentrates effective control of criminal procedure in the hands of a single officer. Our formal law of trial envisages a division of responsibility. We expect the prosecutor to make the charging decision, the judge and especially the jury to adjudicate, and the judge to set the sentence. Plea bargaining merges these accusatory, determinative, and sanctional phases of procedure in the hands of the prosecutor.

Students of the history of the law of torture are reminded that the great psychological fallacy of the European inquisitorial procedure of that time was that it concentrated in the investigating magistrate the powers of accusation, investigation, torture and condemnation. The single inquisitor who wielded those powers needed to have what one recent historian has called ‘superhuman capabilities [in order to] keep himself in his decisional function free from the predisposing influences of his own instigating and investigating activity.

I cannot emphasize too strongly how dangerous this concentration of prosecutorial power can be. The modern prosecutor commands the vast resources of the state for gathering and generating accusing evidence. We allowed him this power in large part because the criminal trial interpose the safeguard of adjudication against the danger that he might bring those resources to bear against an innocent citizen — whether on account of honest error, arbitrariness, or worse.

Ellen Podgor over at the White Collar Crime Prof Blog points us to two documents that raise important issues relating to the federal government’s questionable policy of attempting to regulate business through criminalization of what it deems to be questionable business practices.

Frank Quattrone’s appellate attorneys have based his appeal squarely on last week’s Supreme Court decision in Anderson. The following is the hard-hitting first paragraph from that brief:

The government’s brief is an effort to weave a rope of sand, and to imbue a trial with evidentiary substance and procedural fairness when it was sorely lacking in both. With regard to the evidence, the prosecutors dutifully characterize the defendant as plainly guilty, and describe their proof as “strong” or even “compelling.” [record reference omitted]. This is standard rhetoric for those who write the red-covered briefs in criminal cases. But if this was a “strong” case, then there is no such thing as a weak one. Notwithstanding the government’s cavalier description, this case turned on a “threadbare phrase,” United States v. Mulheren, 938 F.2d 364, 370 (2d Cir. 1991) — Quattrone’s one-line e-mail urging his colleagues to “follow [the] procedures” contained in a standard corporate document retention policy. As the Supreme Court reminded the government only recently, “[i]t is, of course, not wrongful for a manager to instruct his employees to comply with a valid document policy under ordinary circumstances.” Arthur Andersen LLP v. United States, No. 04-368, 2005 WL 1262915, *5 (U.S. May 31, 2005).

Moreover, Professor Geraldine Szott Moohr of the University of Houston Law Center has written this law review article — Prosecutorial Power in an Adversarial System: Lessons from Current White Collar Cases — in which she points out that the increasingly common prosecutorial tactic of bludgeoning white collar defendants into plea bargains undermines the deterrent purpose of such prosecutions. Here is the synopsis for the article:

Successful disposition of the cases against Arthur Andersen, Martha Stewart, high-level Enron officers, and scores of mid-level executives testifies to the authority of federal prosecutors. A review of these cases identifies the sources of prosecutorial power and traces their effect in the investigation, charging, and sentencing phases of white collar crime.

A comparison of the roles of American federal prosecutors and their European counterparts in investigating, charging, and sentencing corroborates the judgment that our present system has a decidedly inquisitorial cast. The power of inquisitorial prosecutors is constrained by inherent safeguards that impose formal and informal limitations on their discretion. In contrast, federal prosecutors exercise greater power in the investigation and charging phases and exercise even more authority in sentencing and plea bargaining. The combination belies adversarial values.

Retreat from the adversarial trial can undermine the goal of deterring business misconduct in several ways. Inconsistent sentences that result from plea bargains can forfeit the moral authority of criminal law in the business community, the very group one wishes to deter. In contrast, public trials provide a rationale for sentences and educate the business community about the illegality of specific conduct, a requirement for optimal deterrence that is especially relevant in white collar crimes. Public trials also strengthen shared social norms of the business community against fraudulent practices. In sum, disposing of criminal cases through quasi-inquisitorial investigation and plea bargaining forfeits an opportunity to reinforce the standards of lawful business conduct and thereby strengthen deterrence.

In that connection, note Professor Langbein’s related comments in this post.