Loyalty's reward - a felony conviction: recent prosecutions of high-status female offenders.

• Author: Jacobs, Michelle S.

1. INTRODUCTION

   Over the past four years, the American public has witnessed a seemingly unending number of corporate and white-collar scandals. Corporate scandals in the business world are not a new phenomenon; indeed, every decade has had its share. Michael Milken, the Wall Street wonder of the eighties, along with his associate, Ivan Boesky, were both dethroned in the "junk bond" scandal. (1) This was followed by the Savings and Loan scandal that sent Charles Keating to jail. (2) The Archer Daniels Midland price-fixing scandal (3) marked the nineties, as did the Whitewater investigation that was closely associated with then President William Clinton and his wife, Hillary Clinton. (4)

   Nonetheless, the present wave of corporate and white-collar scandals distinguishes itself through the sheer number of companies being investigated. (5) It appears that no industry has been safe from scandal. (6) The investigations prompted by the collapse of Houston's energy giant, Enron, were independently responsible for the indictments of thirty individuals as of May 2004. (7) The present scandals are also interesting because they provide us with an opportunity to observe the prosecutions of several women of high status charged with white-collar crime. (8) Other than Susan McDougal, a defendant in the Whitewater case, (9) and Leona Helmsley, the New York Hotel proprietor, (10) one is hard pressed to recall significant numbers of women publicly associated in the past with white-collar crime or corporate scandal at the level we presently see.

   Between 2001 and 2004, six high-status women were charged with crimes in connection with corporate criminal cases. (11) The public is familiar with some of them, although not all of their cases have been covered equally in the press. The most thorough press coverage was of the arrest and trial of Martha Stewart, former CEO of Martha Stewart Living Omnimedia, whose case has been referred to as "mediagenic." (12) Stewart's public persona drove the coverage, despite the fact her criminal acts were neither the most serious, nor the most extensive, of the six. (13) The other five women are Lea Fastow, former assistant treasurer of Enron; (14) Betty Vinson, former account manager for WorldCom; (15) Kathleen Winter, former director at Marsh & McLennan, Inc.; (16) Helen Sharkey, of Dynegy, Inc.; (17) and Paula Rieker, former Vice President, Managing Director of Investor Relations and Corporate Secretary of Enron. (18) Lea Fastow's prosecution received some media attention, although the simultaneous prosecution of her husband, Andrew Fastow, the former CFO of Enron, undoubtedly motivated the coverage. (19) Similarly, Betty Vinson's case came to the attention of the press because her guilty plea helped secure the government's case against the CFO of World Com, Scott Sullivan. Sullivan eventually entered into a cooperation agreement with the government. (20) His cooperation enabled the government to prosecute Bernard Ebbers, the CEO of WorldCom at the time the telecommunications firm collapsed. (21) Relatively little information can be found in the public domain about the other three women, who have all plead guilty, and are presently cooperating with authorities and awaiting sentencing in 2006.

   During the same period of time these corporate scandals were unfolding, another "mediagenic" case of a high-status woman was investigated and prosecuted. This woman was rap artist Lil' Kim, whose birth name is Kimberly Jones. (22) At first blush, Lil' Kim's case appeared to fit within the parameters of the prosecutions of the other high-status women. She was, for example, charged with a classic white-collar cover-up crime, as was Martha Stewart. (23) She was charged in connection with an investigation into the actions of others. However, for reasons that will be discussed in Part IV of this Article, Lil' Kim's high status was not sufficient to elevate her case to the level of white-collar treatment. (24)

   The fact that little media attention has been devoted to these women's cases is not surprising. With the exception of an occasional article now and then mentioning the exploding rates of female incarceration, women's crime tends to be invisible to the public eye. (25) The statistical data the government collects and analyzes on women and crime will be discussed in Part II. Through the use of this data, a portrait of the female offender will be developed, and the factors, or pathways, which lead to women's offending will be discussed. In addition, a query will be made as to whether a pathway based on loyalty can be added. What can the experiences of Fastow, Vinson, and Stewart tell us about women's crime? Is there a basis of comparison between the prosecution of these high-status women and the prosecution of women engaged in regular street crime?

   Part III of this Article will focus on the prosecution of the individual cases of Fastow, Vinson, and Stewart. Their cases, and where relevant, their life circumstances, and the issue of whether loyalty played a role in their offending, will be examined and contrasted with the experiences of female offenders who are not of high status. Lil' Kim's prosecution will be the focus of Part IV and will highlight the problems of a female offender of color who has high status but whose acts are deemed to be street crimes. The Article concludes by suggesting that although the high-status female white-collar offender does not share the personal characteristics of the regular female offender, the two groups of women share a common pathway to crime--loyalty to a man engaged in wrongdoing. Moreover, white-collar female offenders do not differ significantly from many women who are incarcerated for street crimes. Lil' Kim's case offers an example of how strikingly close a street crime offender can be to a white-collar offender.

2. WOMEN AND CRIME

   In the past, women's crime was not specifically studied to determine whether the criminal justice policies that were developed with men in mind were put to appropriate use with women offenders. There was an unspoken assumption that the analysis of men's criminality would satisfactorily explain women's criminality. By all measures available now, that assumption was erroneous. (26) Most women in prison have been convicted of non-violent crimes, property crimes, and low-level drug offenses. (27) The majority of incarcerated women are women of color. (28) Incarcerated women, in general, had attained low levels of education and were living under harsh economic conditions prior to their arrest. (29) Over forty percent of women offenders reported a history of physical or sexual abuse prior to offending. (30)

   The factors that appear to contribute to women's criminality are low income, school failure, and limited vocational skills and work experience. (31) In addition, women victims of profound physical and sexual abuse tend toward a disproportionately criminal path. (32) The two scholars most frequently cited who study women's pathways to crime are sociologists Kathleen Daly and Beth Richie. In her study, Daly compared women and men's offending within the context of a criminal court in Connecticut. (33) Richie, on the other hand, focused on battered African American women detained at Riker's Island in New York. (34) Though each used differing nomenclature for the pathways they observed, both recognized the role violence, abuse, and poverty played in the pathways. (35) Daly's category of "other" included women who were not abused or drug-addicted and seemed to commit crime out of economic necessity or greed. (36) Although both sociologists make reference to crimes committed by women in association with men, Richie specifically mentions loyalty as a factor that may trap African American battered women. (37)

   None of the factors traditionally found among women offenders appear to be relevant for the six White high-status women featured in this article. Which, if any, factors would be predictive of white-collar offenses among women? After the feminist movement took root in the United States, theories abounded suggesting that with women's impending liberation, there would be a corresponding increase in the number of women committing white-collar crime. (38) The theory was that as more women moved up the corporate ladder, there would be more opportunity to engage in the same types of crimes as male executives. (39) This expected increase in women's white-collar crime did not materialize. Although the number of women in prison has increased, this is believed to be a result of changes in criminal justice policy, rather than changes in the amount and type of crime women commit. (40) More women are now being sent to prison for Offenses that used to garner only a probationary sentence, but women still primarily commit non-violent crimes: larceny, theft, drunken driving, and fraud. (41) In criminal enterprises, women still function at the lower echelons, clustered at the bottom of the organizational hierarchy, and their involvement in criminal activity is as minor players rather than primary players. (42)

   The typical life circumstances and characteristics of women incarcerated today appear strikingly different from the women named in corporate scandals. The six women previously identified in this Article are White, highly educated, and worked in high-status positions, enjoying relatively large salaries. It is doubtful whether they serve as an indication that women have arrived in the higher ranks of white-collar crime. Indeed, it might be argued that although these women do not fit the characteristics of most female offenders, their crimes nonetheless fit squarely within the second most prevalent category of women's crime: fraud. In addition, despite the fact that there has been an increase in the number of women charged with embezzlement, most women charged in this category of offense are still low-level clerical staff and bank tellers. (43) The...