The Senate Judiciary Committee agreed yesterday to examine the Justice Department's prosecutorial decisions in recent criminal cases after one senator accused the department of being soft on white-collar crime.
Sen. Howard M. Metzenbaum (D-Ohio) criticized Justice Department officials for dropping charges or failing to seek prison terms for individuals in a series of cases involving E.F. Hutton & Co., Eli Lilly and Co., SmithKline Beckman Corp., and Teamsters union President Jackie Presser.
"If you're guilty of white-collar crime, there's a kind of protective cloak thrown around you," Metzenbaum said. "If you wear a white collar, you don't get prosecuted." Committee Chairman Strom Thurmond (R-S.C.) said the panel will hold oversight hearings on the cases' handling.
"We're happy to have our record examined because we're proud of that record of prosecuting white-collar or economic-crime cases," department spokesman Terry H. Eastland said, citing stiff prison terms for former deputy defense secretary Paul Thayer, Tennessee banker Jake Butcher and others.
Eastland said the administration was "breaking new ground" in the Hutton check-kiting case and was first to charge drug companies with failing to report adverse drug reactions.
The committee also approved the nomination of Richard Willard to head the department's Civil Division but agreed not to send his name to the Senate floor until Metzenbaum can examine Willard's role in the Eli Lilly case.
Metzenbaum criticized Willard's decision not to prosecute Syntex Laboratories Inc. for producing adulterated infant formula. He also called the $2 million fine against E.F. Hutton "a drop in the bucket."
"Then the Justice Department drops the prosecution of Jackie Presser because he's an informant" for the FBI, Metzenbaum said. "An informant? Against whom? He's the biggest of the big. Do you drop prosecution against the biggest of the big to get [his uncle], Allen Friedman, who was a nobody?"
Metzenbaum said prosecutors had brought "only misdemeanor charges" against SmithKline Beckman for failing to report adverse reactions to Selacryn, a medicine for high blood pressure. He also complained that Eli Lilly had been let off with the maximum $25,000 fine -- and a former vice president with a $15,000 fine -- for failing to report deaths associated with its arthritis drug, Oraflex.
"Why, with all of those deaths, no individual [was held] responsible?" Metzenbaum asked.
Some aides to Willard had recommended prosecution of three other Lilly officials. Deputy Attorney General D. Lowell Jensen, who made the final decision, wrote Thurmond, saying that further charges would have involved "substantial litigation risk" and that "a loss would signal that we are unable to punish this type of conduct."