Financial Transparency Coalition

Last night I attended a dinner honoring New York District Attorney Robert M. Morgenthau, who has served the borough of Manhattan for thirty-four years.  At the age of 90, he is retiring, which, as he has noted, is “25 years past the normal age.”  Last night’s event honoring Mr. Morgenthau’s career of public service was hosted by Global Financial Integrity and The American Interest.

As was made clear by the speeches of adoring Congressmen and Senators last night, Mr. Morgenthau has proven himself a dedicated public servant, in the truest sense of the word.  Over his long tenure, Mr. Morgenthau has vigilantly pursued mobsters, murderers, and Wall Street executives, with no thought to his personal safety.  And we all know how hard CEOs bite.

The achievements of this man have been both far-reaching and diverse.  In 1981 Mr. Morgenthau prosecuted Mark David Chapman, who pled guilty to murdering John Lennon.  As a District Attorney, he was a pioneer for using DNA as evidence in prosecution, which is now common place in criminal cases.  He also crusaded against crimes against women at a time when sex crimes often garnered laughter and jokes from law enforcement officials. And Assistant District Attorneys to Mr. Morgenthau have included many notables such as Justice Sonia Sotomayor and John F. Kennedy Jr.

Mr. Morgenthau was also a model for the prosecutor Adam Schiff, on the popular TV show, Law and Order.  When asked about the show in an interview, the District Attorney replied, “I’m not a big TV guy, but I liked the Adam Schiff character. I told him once when we met that I wanted to know when he was resigning because I wanted his job. You know he got paid something like $25,000 an episode?”

Along with his triumphs against murderers and rapists, Mr. Morgenthau has paid close attention to white collar criminals over his tenure–which as we all know–are the thugs which often run most rampant in Manhattan. And as the financial crisis has shown us, they often cause the most damage.  In his most famous case of this nature, Mr. Morgenthau indicted the Bank of Credit and Commerce International (BCCI).  As was later revealed, the structure of the entire bank was “set up deliberately to avoid centralized regulatory review, and operated extensively in bank secrecy jurisdictions. Its affairs were extraordinarily complex. Its officers were sophisticated international bankers whose apparent objective was to keep their affairs secret, to commit fraud on a massive scale, and to avoid detection.”

Mr. Morgenthau, who had jurisdiction because millions of dollars laundered by the bank flowed through Manhattan, investigated BCCI for two years.  He eventually indicted the bank and its founder, Agha Hasan Abedi, on twelve counts of fraud, money laundering and larceny.

Though Mr. Morgenthau has championed these ideas for decades, it is becoming increasingly accepted that banking secrecy is used to cover up much more than just financial crimes.  In fact, underhanded financial dealings are often indicative of drug money, terrorist financing, and money laundering.  As such, these threats represent not only a challenge to development and governance, but also a challenge to U.S. national security interests (see Iran and Venezuela: A Marriage of Passion, Convenience and Money).  Indeed, as one speaker noted, the infamous American gangster Al Capone was originally arrested on charges of income tax evasion.