Legal Experts Mull The Impact of an Andersen Acquittal
The discussions follow a week of testimony in which a number of Andersen partners and staff explained their varying interpretations of the firm's document retention policy. An informal poll conducted by the Wall Street Journal shows the public is split just about 50/50 in its unofficial verdict as to Andersen's guilt or innocence. Critical closing arguments and jury instructions could come as early as this week.
Less Leverage, More Limited Charges
If Andersen is found not guilty, experts say it will have two important results for Enron and the DOJ:
- It will lessen the DOJ’s ability to use fear of conviction to persuade targets to cooperate its ongoing investigations into Enron's collapse and other matters. Criminal defense attorney Kent Schaffer told Reuters that white-collar defendants are particularly afraid of prosecution and are often led by their lawyers to believe that the federal government cannot be beat. "Because of that, you see guilty pleas and 'cooperation' from people who may not really be guilty," he said. "Should the government lose this first battle, it may make future targets stop and think that their situation is not quite so bad."
- It will limit the charges that can be brought against Enron or its officers. Robert Mintz, a former federal prosecutor who now practices white collar criminal defense at the firm of McCarter & English, explains how and why. He says that David Duncan's assertion that Andersen properly accounted for Enron's more questionable dealings has given Enron a key defense: that it relied on the professional advice of its auditors. "I would expect the government to shy away from any of the bookkeeping practices ultimately sanctioned by Andersen," he says, "and instead develop a case that emphasizes the financial dealings at Enron that were concealed from the Andersen accounting team."
"If Arthur Andersen is acquitted," explains Mr. Schaffer, "it can have a devastating effect on the subsequent Enron investigation. It probably was not a wise move for the government to proceed so quickly."