The best books on corporate crime

Who am I?

I teach the law and enforcement of corporate crime as a law professor. At the outset of the course, I tell the students that corporate crime is a problem, not a body of law. You have to start by thinking about the problem. How do these things occur? What is the psychology, both individual and institutional? What are the economic incentives at each level and with each player? What role do lawyers play? When do regulatory arrangements cause rather than prevent this kind of thing?  If the locution were not too awkward, I might call the field “scandalology.” I love every one of these books because they do such a great job of telling the human stories through which we can ask the most interesting and important questions about how corporate crimes happen.


I wrote...

Capital Offenses: Business Crime and Punishment in America's Corporate Age

By Samuel Buell,

Book cover of Capital Offenses: Business Crime and Punishment in America's Corporate Age

What is my book about?

At the heart of the dilemma of corporate crime sits the limited liability corporation and the structure of financial markets, simultaneously the bedrocks of American prosperity and the reason that white-collar crime is difficult to prosecute. The corporation is a brilliant legal innovation that, in modern form, can seem impossible to regulate or even manage. By shielding managers and employees from responsibility, the corporation encourages the risk-taking that drives economic growth. But its special legal status and its ever-expanding scale place daunting barriers in the way of federal and local investigators.

Explaining in a breezy style the complex legal frameworks that govern both corporations and the people who carry out their missions, this book shows both the specialist and general reader how deciphering business crime is rarely black or white. 

The books I picked & why

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Empire of Pain

By Patrick Radden Keefe,

Book cover of Empire of Pain: The Secret History of the Sackler Dynasty

Why this book?

This may well be the best book ever written on a corporate scandal. Just out, I expect to see it on prize lists for this year. Keefe weaves together three independently fascinating stories in seamless, brilliant, and deeply researched fashion: a 20th-century immigrant American dynastic family (the Sacklers), the emergence of the modern pharmaceutical industry, and the opioid disaster. His eye for the smoking gun document or telling admission is as good as his eye for irony and the many darkly humorous connections in this saga. The book gets better as it goes on, all the way to the end, where he takes the reader carefully through the thoroughly dispiriting story of the legal system’s handling of Purdue Pharma’s involvement in the opioid market. This book made my blood boil—and I am usually the one trying to explain why accountability is harder to impose than most people think.


Bad Blood

By John Carreyrou,

Book cover of Bad Blood: Secrets and Lies in a Silicon Valley Startup

Why this book?

This is the other genius book written recently about a corporate scandal. Carreyrou pulls off two great things in his account of Elizabeth Holmes and Theranos, her Silicon Valley start-up that purported to revolutionize medical testing but evaporated in a cloud of lies. First, he shows how a charismatic young person with seemingly no scruples could delude dozens of rich, sophisticated, and sometimes famous people. This book uncovers the psychology involved in white-collar crime as well as any story I have read. Second, Carreyrou’s account is absolutely devastating with regard to the conduct of lawyers who not only defended Holmes but attempted to silence and destroy whistleblowers and critics, including Carreyrou himself, who unavoidably becomes an important character in the story. Look out for the trial of this case, which is scheduled to begin in August 2021. And also the Jennifer Lawrence movie…


The Informant

By Kurt Eichenwald,

Book cover of The Informant: A True Story

Why this book?

There is a partial myth, eagerly promoted by corporate interests and their lawyers, that federal prosecutors are frighteningly all-powerful and basically cannot be defeated. The veteran financial and legal reporter Eichenwald knows otherwise. The Informant, in contrast to the almost farcical (if enjoyable!) Stephen Soderbergh movie based on the book, lays out a textbook case of how prosecutors can blow an important case due to infighting, problems with unreliable informants, and clever high-priced defense lawyering that exploits every error that less-than-superb prosecutors might make. Here we have a tale of CEO-level officials at major global corporations caught on videotape flagrantly conspiring to violate antitrust laws and, in the end, almost no one ends up in prison. Eichenwald details the countless blunders by many Justice Department lawyers spread across several offices, and the clever maneuvering throughout by crack corporate defenders. He too, by the way, paints a fascinating portrait of the informant Mark Whitacre, a uniquely problematic figure who was played by Matt Damon to delightful effect in the film. In fairness to the government lawyers, every prosecutor knows that you do not get to pick your witnesses. You must take them as you find them.


Fiasco

By Frank Partnoy,

Book cover of Fiasco: The Inside Story of a Wall Street Trader

Why this book?

Partnoy, a distinguished law professor at Berkeley, is a brilliant chronicler of the people and products in modern financial markets. One could read any of his books and say they were among the best ones on the market and corporate chicanery. But I love his first book, in which he tells the tale of his brief time trading derivatives—back in the very early days of those now world-famous products—among the unsavory characters of a Wall Street trading floor. The story has been told by others since (Wolf of Wall Street, Big Short, etc.) but Partnoy may have done it first. And seeing that world through his young, brilliant, and impressionistic eyes is wonderful. His firm tried to block him from publishing the book, but he did it and has gone on to a magnificent academic career in which he continues to tell it like it is, understanding the world on the ground as well as anyone in the academy.


The Smartest Guys in the Room

By Peter Elkind, Bethany McLean,

Book cover of The Smartest Guys in the Room: The Amazing Rise and Scandalous Fall of Enron

Why this book?

Because I was a prosecutor on the Enron case, people often ask me what to read about it (or even to explain it to them!). At the time, we used to say that Enron was calculus to every other case’s algebra when it came to corporate financial fraud. Elkind and McLean (McLean had a lot to do with questioning Enron’s narrative before the company’s decline) have done the definitive job of explaining a very hard case in accessible style and detail. The truth is that accounting fraud is a very technical form of corporate fraud, sometimes painfully so. But, as I tell my students, the people who work at companies on these kinds of things are no smarter, and often no older, than my students. They just speak a different language. Don’t let that obfuscate matters. Learn the lingo and follow the money. Smartest Guys allows the general reader to do exactly that with regard to Enron, and the book is fair and careful in showing what a lot of people did not realize about the case: most of what Enron did, while manipulative to be sure, was not illegal and the criminal case had to focus on the instances where executives stepped over the line to fraud.  Bankrupting a big company is not itself a crime. The deeper lessons of Enron, alas, were not learned during the intense focus on a few individual prosecutions. In the financial crisis of 2008-2009, many of the same things happened again on a much more devastating scale.


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