This week, federal prosecutors indicted former Speaker of the House Dennis Hastert.
Hastert is charged with two federal crimes: structuring financial transactions to evade IRS reporting requirements in violation of 31 U.S.C. section 5324(a)(3) and lying to the FBI in violation of the notorious 18 U.S.C. section 1001. Both charges reflect the breadth of federal prosecutorial power.
The indictment has mostly inspired chatter about what it doesn't say. Hastert is charged with structuring withdrawals of less than $10,000 (so that they would not be reported to the IRS) so that he could pay off an unidentified person for Hastert's unidentified past misconduct. What past misconduct, or threatened accusation of misconduct, could lead Hastert to pay $3.5 million? The indictment doesn't say, but it has been drafted to imply that the allegation of past misconduct relates to Hastert's job as a teacher and coach in Yorkville, Illinois. Hastert isn't charged with doing anything to the accuser, and the accuser isn't charged with extortion.
As Radley Balko has pointed out, structuring (or "smurfing") charges are extremely flexible. They demonstrate the reality of how Americans targeted by the Department of Justice can be charged. We imagine law enforcement operating like we see on TV: someone commits a crime, everyone knows what the crime is, law enforcement reacts by charging them with that crime. But that's not how federal prosecution always works. Particularly with high-profile targets, federal prosecution is often an exercise in searching for a theory to prosecute someone that the feds would like to prosecute. There is an element of creativity: what federal statute can we find to prosecute this person?
We'll learn more about the reasons for Hastert's payments in the course of the case (or through Department of Justice leaks calculated to harm him). I suspect we'll find that the investigation happened like this: the feds heard that Hastert was paying someone off based on an accusation of old misconduct, determined that the misconduct was too old (or out of their jurisdiction) to prosecute, and started subpoenaing records and interviewing witnesses until they found some element of what he was doing that was a federal crime. In other words, they targeted the man, and then looked for the crime.
The problem with this scenario is that federal criminal law is extremely broad. Practically speaking, it gives federal prosecutors vast discretion to determine who among us faces criminal charges. If you think that you're safe because you've never committed a crime, you may learn to your surprise that you're wrong.
The rational response to this situation is clear: don't trust the feds, don't talk to the feds. But Dennis Hastert, like many accomplished people, believed he could talk his way out of the situation. When the FBI came to interview him, he didn't refuse to answer and call his lawyer. According to the indictment, he confirmed in response to an FBI agent's question that he was withdrawing cash in order to store it because he didn't feel the banking system was safe. For that, he's been charged with lying to federal agents.
This is another aspect of the federal government's vast prosecutorial discretion. Hastert's alleged false statement happened in December 2014. When agents interviewed him, I guarantee you that the feds had already made their case. They had already put witnesses before the grand jury, they had already used grand jury subpoenas to get Hastert's bank records, they already knew exactly how they would charge and prove up the structuring charge. When they went to interview Hastert, there were only three possible outcomes: he would refuse to talk, he would confess, or he would lie in a way they could easily disprove. They were looking either for the confession, which would make their case easier, or the lie, that would give them a new theory on which to charge him with a crime. Under Section 1001 a lie must be material to be criminal. But the materiality element is weak. It only requires the government to show that the lie is the sort of statement that could conceivably influence the FBI. It doesn't require the government to show that the lie actually had any impact whatsoever. Thus the FBI can show up with its case ready to indict, fish for a lie that they know is a lie, and pile that charge on top of whatever the substantive charge is. That's why I bring up Section 1001 so often and explain why it means you must shut up. You can be prosecuted for as little as saying "no, I didn't" in response to a already-documented accusation.
The criminal justice system needs to be able to prosecute perjury — lies under oath before a tribunal. And I can see why it needs to be able to punish false statements to the federal government that represent an attempt to commit fraud (say, false statements to get a passport) or that impact an investigation (say, a false accusation that triggers an inquiry).
But ask yourself: what is the legitimate basis for giving the feds the power to prosecute people for exculpatory lies that have no impact whatsoever on their operation?
From the federal government's perspective, the basis is clear: it's a tool to help them charge people they want to charge.
From the citizen's perspective, this situation points to one obvious conclusion: shut up. Never answer a federal agent's questions without a thorough debriefing with a qualified lawyer first.