J.D., New York University School of Law, 2021; B.A., Yale College, 2016. I would like to thank Professor Harry First for his thoughtful, enthusiastic, and dedicated teaching and the editors of the Annual Survey of American Law for their diligent and helpful edits.
Table of Contents
- I. The State of Federal Enforcement
- II. The Benefits of State-Led Ethics Enforcement
- III. Improving Effectiveness
- IV. Current Progress
The Supreme Court’s decision in Kelly v. United States marked its latest curtailment of the federal government’s leeway to prosecute state- level public corruption.1 The case concerned the federal fraud convictions of two aides to New Jersey governor Chris Christie for their roles in “Bridgegate,” a scheme to create gridlock in Fort Lee in order to punish the town’s mayor for refusing to support the governor’s reelection bid.2 The subject matter of the case may have been controversial, but the Court’s opinion was not: the Justices voted unanimously to overturn the aides’ federal program and wire fraud convictions, repeating the Court’s decades-old instruction that “Federal prosecutors may not use property fraud statutes to ‘set[ ] standards of disclosure and good government for local and state officials.’”3
Given a long trend in federal caselaw restricting the ability of the federal government to regulate state and local corruption, it is worth considering the ability of states to do the job themselves. Unlike the federal government, their efforts are not hobbled by federalism concerns. States’ capabilities vary, and some arrangements seem more effective than others, but there are structures that can produce successful outcomes everywhere, and a rising tide may lift all boats. At its best, a system of robust state public corruption enforcement offers the promise of democratic accountability and targeted, responsive enforcement. Part I of this paper summarizes federal enforcement’s shrinking prerogative, Part II examines the benefits of state-led public corruption enforcement, Part III discusses ideas for how to improve state enforcement, and Part IV assesses the status quo of state enforcement as well as the difficulties in ascertaining this.
I. The State of Federal Enforcement
Over the last three decades, the Supreme Court has steadily trimmed federal power to punish state public corruption. Its rulings emphasize that a property rights conception provides the constitutional grounding for federal prosecution of state corruption, and federal action must hew to this notion. First, in the 1987 McNally case involving a Kentucky state official’s mail fraud conviction, the Court dispelled the notion of an intangible property right to honest services.4 It criticized a reading of the federal mail fraud statute that “[left] its outer boundaries ambiguous and involve[d] the Federal Government in setting standards of disclosure and good government for local and state officials,” arguing that Congress needed to speak more clearly if the statute were meant to protect more than tangible property rights.5
In response, Congress the next year redefined a “scheme or artifice to defraud” to include “a scheme or artifice to deprive another of the intangible right of honest services.”6 Yet, over 20 years later, the Court limited the honest services fraud statute because of vagueness.7 In order to preserve the mail fraud statute’s constitutionality, the Court in Skilling v. United States interpreted it as criminalizing “only the bribe-and- kickback core of the pre-McNally case law.”8
A few years after Skilling, the Court again curtailed federal honest services fraud to eliminate a different constitutional vagueness concern. In overturning the conviction of former Virginia governor Bob McDonnell for arranging meetings to facilitate a political donor’s promotion of a nutritional supplement to state university officials, the Court narrowed what constituted an “official act” under the federal bribery statute, which prosecutors had used to define honest services fraud.9
Most recently, in Kelly v. United States, the Court determined that the George Washington bridge lane closure was a “regulatory” choice, not a misappropriation of public property, and that because associated employee time and labor costs were not the scheme’s object but merely a byproduct, these costs were not stolen property. Obtaining property was not at the heart of the scheme, so the federal fraud convictions could not stand.10
Together, these rulings diminish the ability of federal prosecutors to pursue state public corruption because federal prosecutions can reach only conduct that is primarily aimed at illegally obtaining property, narrowly defined, through an “official act.” Thus, state-level enforcement to combat corruption deserves examination.
II. The Benefits of State-Led Ethics Enforcement
State-level public ethics and corruption enforcement hold the potential for more accountable and targeted action than federal enforcement can provide.
A dominant federal role that crowds out state enforcement diminishes states’ accountability to their electorates. If citizens expect the federal government to regulate public corruption for states, they may be less likely to discipline state governments at the ballot box for failures to control state and local corruption (reducing state governments’ incentives to go after it in the first place).11 And it is worth remembering the Supreme Court’s oft-repeated admonishment that “[f]ederal prosecutors may not use property fraud statutes to ‘set[ ] standards of disclosure and good government for local and state officials.’”12 If state authorities do not themselves set and reinforce “standards of disclosure and good government,” it is not clear how these standards will be maintained, even with competent federal enforcement.
Federal enforcement agencies are less directly answerable to state electorates than state enforcers are, and they, like any organization, are susceptible to self-serving impulses.13 A prominent example of this dynamic is the transformation of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (“ATF”) in the mid-1990s to focus on violent criminality and cooperation with local law enforcement authorities in order to protect itself from the gun lobby’s attacks after its ill-fated siege of the Branch Davidians’ compound in Waco, Texas.14 More recently, there were countless allegations of the Trump administration politicizing enforcement actions at the Department of Justice.15 Increased federal enforcement is a predictable consequence of weak state enforcement, but if federal enforcers play a big role in state-level corruption regulation and fall prey to conflicts of interest, states are left without recourse.
Robust state enforcement is also preferable to federal enforcement because of states’ capacity to investigate conduct and cases that federal enforcers might consider too “small.”16 Given the federal government’s broad responsibilities and the Supreme Court’s admonishments not to set uniform federal corruption standards for states, there is only so much local corruption enforcement that the federal government has the interest or ability to cover. State authorities may have more local knowledge and ability to root out corruption, but warding off improper influences and translating local expertise into targeted public corruption enforcement requires effective design.
III. Improving Effectiveness
State ethics enforcement efforts vary greatly, but at a minimum, a structure that provides authority for investigations and sanctions, transparency, and political independence is necessary for effectiveness. The Coalition for Integrity (“C4I”), a group that studies corruption and partners with organizations to combat it in the private and public sectors, recommends that states grant ethics agencies wide authority to investigate and sanction all government officials with meaningful fines.17 It also recommends that agencies issue regular reports and publicize findings, sanctions, and even the existence of investigations once a determination of probable cause exists (much like the way indictments are treated).18 Ethics enforcement enhances deterrence and builds ethical norms if conducted in the public eye.19
There is a question of where best to situate enforcement bodies within state governments. Coordinating efforts at the statewide level, rather than relying on municipal entities, takes advantage of greater jurisdictional reach, and centralization allows for the development of expertise.20 Also, a statewide body may be further removed from subjects of investigations than local officials would be, so it may be more insulated from the risk of political capture.21 Likewise, situating ethics enforcement within a prosecutor’s office rather than a police department may offer greater distance from the targets of investigations (at least more often than the other way around).22
Political independence is paramount to meaningful government ethics and anti-corruption efforts, especially considering the ripple effects of enforcement on norms. Active ethics enforcement could have counterproductive effects on compliance if it were to be seen as a political weapon for those in power.23 An example of institutional design to project fairness is California’s Fair Political Practices Commission, which requires that two of its five Commissioners be appointed by the Governor and belong to different parties and that the Attorney General, the Secretary of State, and the State Controller each appoint one Commissioner, unless all three officials belong to the same political party, in which case the Controller picks a candidate from a list provided by the opposition party.24
Also crucial to political independence is independent or guaranteed funding. Once officials are appointed, in order for enforcement bodies to remain effective, statutes must protect them from being hollowed out financially. Legislators may otherwise seek to underfund organizations in order to kneecap oversight.25
Analyzing the effects of these structures also requires considering their dynamic effects: success in some states could foster it in others. A parallel can be drawn to the experience of member-countries of the OECD Anti-Bribery Convention.26 These states meet regularly to discuss investigations, share ideas and best practices, and to raise concerns or criticism.27 In the words of a former Deputy Secretary General, “These are closed-door meetings, where officials can talk frankly with each other about real-life issues they face prosecuting and investigating foreign bribery cases. If one country hasn’t done enough to investigate an allegation or is reluctant to decide a case, then they face intense questioning by the other members of the Group.”28 A network of powerful and effective state public corruption enforcers could benefit anti-corruption efforts in multiple ways.
First, the presence of a strong network of state enforcers could provide peer pressure and advice to help states break cultures of corruption. Partnerships could produce more lasting change than relying on federal authorities to sporadically swoop in and clean up from above. Virginia, for example, seems like a state that could benefit from a collaborative approach. The federal investigation into former governor McDonnell uncovered widespread corruption, but federal enforcers lacked the statutory authorization to prosecute even the governor.29 The state legislature did respond to McDonnell’s indictment in 2015 by forming (for the first time) an anticorruption commission, but the commission cannot initiate investigations, issue subpoenas, or impose fines.30 Virginia was one of the states C4I excluded from its 2019 assessment of state anticorruption enforcement for lacking meaningful enforcement powers.31
Second, a culture of vigorous state public corruption enforcement promotes states enforcing the laws on their books – in other words, enforcing the “standards of disclosure and good government” that they have set for themselves. State standard-setting is a crucial step in improving public corruption enforcement since the Supreme Court has ruled that only states, not the federal government, can perform this task.32 And states enforcing their own laws could yield significant ethics and corruption improvement because, ironically, states with the worst corruption problems tend to (eventually) have the most comprehensive anti-corruption legislation. As the President and CEO of the Better Government Association noted in the organization’s most recent report, “the states with the worst reputations and sorriest histories of political corruption face the most public pressure to clean up their acts, so they pass new laws and strengthen old ones to create a framework of integrity.”33
For example, the organization listed New Jersey second in its “Integrity Index” ranking of states.34 This report predates Bridgegate, but despite that scandal’s impact, it is not clear that New Jersey’s ranking would be dramatically lower today. After all, New Jersey’s able public corruption capabilities featured in the Kelly opinion itself. In Justice Kagan’s majority opinion, when she concluded that the “upshot” of the Court’s ruling was that “federal fraud law leaves much public corruption to the States (or their electorates) to rectify,” she specifically referred to New Jersey’s law prohibiting the unauthorized exercise of official functions.35 A search of the law’s citation in state court opinions in the last several years confirms its regular use in public corruption cases.36
IV. Current Progress
Measuring public corruption enforcement is challenging. Many jurisdictions, especially those without strong enforcement authority, collect and publish little data, and metrics may yield little insight even when they are available. C4I produced a report assessing and comparing states’ approaches from 2016-2018, and it is clear that commitment levels and effectiveness diverge in several ways.37 First of all, not all states have independent ethics agencies or agencies with meaningful enforcement powers; C4I noted that it excluded eight states from its study on these grounds.38 Second, there are large disparities in the numbers of cases that state independent ethics agencies processed: in 2018, the Massachusetts State Ethics Commission received the most complaints of any agency with 1,003, followed by the Alabama Ethics Commission with 502.39 These two states led even more populous jurisdictions: the California Fair Political Practices Commission received just 345 complaints, for example, and the Florida Commission on Ethics received only 188.40 Lastly, state agencies grant different levels of transparency to the public. In 2016-18, just 18 states published annual or biennial reports.41 Also, many state agencies released little information apart from bare statistics (just 30 states published agencies’ decisions on their websites, for instance).42
Another challenge in measuring state public corruption enforcement is interpreting the data that is available. Evidence that a state agency processes large numbers of complaints does not reliably indicate that it meaningfully controls public corruption. For instance, agencies may simply target many lower-level government employees for petty corruption rather than spend significant resources (and take on more risk) investigating high-level officials.43 And states may be hampered by patchy jurisdiction or weak penalties that cannot incentivize compliance with ethics laws, which themselves may not effectively capture corrupt conduct.44
Even forming an understanding of the basic state of affairs is difficult in some jurisdictions, and the lack of visibility correspondingly hamstrings comparative study. However, reform efforts, especially cooperative ones, hold potential for momentum in the direction of transparency and accountability.
Provided that state authorities have sufficient authority and political independence, robust state public corruption enforcement holds the possibility of democratically established ethics norms and better compliance with them. The Supreme Court in Kelly v. United States and preceding cases has clipped federal enforcement of state public corruption, but disabusing states of the notion that the federal government is able to take care of their public corruption problems opens the door to an opportunity for a decentralized system of state enforcement that, if pursued aggressively, offers the promise of more focused, democratically accountable, and effective public corruption and ethics enforcement.
- 140 S. Ct. 1565 (2020). ↩
- Id. at 1568. ↩
- Id. at 1574 (quoting McNally v. United States, 483 U.S. 350, 360 (1987)). ↩
- See McNally, 483 U.S. at 356. ↩
- Id. at 360. ↩
- 18 U.S.C. § 1346. ↩
- See Skilling v. United States, 561 U.S. 358, 405-08 (2010). ↩
- Id. at 409. ↩
- McDonnell v. United States, 136 S. Ct. 2355, 2368-75 (2016) (referring to 18 U.S.C. § 201). ↩
- 140 S. Ct. 1565, 1574 (2020). ↩
- See Daniel C. Richman, The Changing Boundaries between Federal and Local Law Enforcement, in 2 CRIM. JUST. 2000: BOUNDARY CHANGES CRIM. JUST. ORGS. 81, 97 (2000). ↩
- McNally v. United States, 483 U.S. 350, 360 (1987). ↩
- Richman, supra note 11, at 94. ↩
- Id. ↩
- Nicholas Fandos, Katie Benner & Charlie Savage, Justice Dept. Officials Outline Claims of Politicization Under Barr, N.Y. TIMES (June 24, 2020), https://www.nytimes.com/2020/06/24/us/politics/justice-department-politicization.html [https://perma.cc/6VNT-6T2G]. ↩
- Jason Kohn, The Case for State-Level Anticorruption Prosecutions in the U.S., GLOBAL ANTICORRUPTION BLOG (Jan. 14, 2019), https://globalanticorruptionblog.com/2019/01/14/the-case-for-state-level-anticorruption-prosecutions-in-the-u-s [https://perma.cc/JV5H-JCU9]. ↩
- COALITION FOR INTEGRITY, C4I, ENFORCEMENT OF ETHICS RULES BY ST. ETHICS AGENCIES 33 (2019). ↩
- Id. ↩
- See, e.g., ORG. FOR ECON. COOP. & DEV., BUILDING PUBLIC TRUST: ETHICS MEASURES IN OECD COUNTRIES 5 (2000) (suggesting steps for building trust in public institutions). ↩
- See Blake Ellison, Where Should U.S. State Governments Put Their Anticorruption Agencies, GLOBAL ANTICORRUPTION BLOG (July 8, 2019), https://globalanticorruptionblog.com/2019/07/08/where-should-u-s-state-governments-put-their-anticorruption-agencies[https://perma.cc/V8UH-SXUX]. ↩
- Id. ↩
- See id. (referring to frequent ethics investigations into police overtime abuse). ↩
- See, e.g., Katie Benner and Adam Goldman, Justice Dept. is Said to Open Criminal Inquiry into its Own Russia Investigation, N.Y. TIMES (Aug. 14, 2020), https://www.nytimes.com/2019/10/24/us/politics/john-durham-criminal-investigation.html [https://perma.cc/LH8T-HMRR.] ↩
- Hilary Hurd, Getting State Anticorruption Commissions to Work, GLOBAL ANTICORRUPTION BLOG (Dec. 10, 2018), https://globalanticorruptionblog.com/2018/12/10/getting-state-anticorruption-commissions-to-work [https://perma.cc/TM8U-8GAJ]. ↩
- Id. ↩
- Chris Crawford, An International Success, Applied in the US: The OECD Law Enforcement Group as a Model for US State Prosecutors, GLOBAL ANTICORRUPTION BLOG (Mar. 2, 2015), https://globalanticorruptionblog.com/2015/03/02/an-international-success-applied-in-the-u-s [https://perma.cc/9UR5-5NWQ]. ↩
- Id. ↩
- Id.; see, e.g., Mengqi Sun, Antibribery Group Urges Slovenia to Step Up Foreign Bribery Enforcement, WALL ST. J. (Mar. 18, 2021, 6:01 AM), https://www.wsj.com/articles/antibribery-group-urges-slovenia-to-step-up-foreign-bribery-enforcement-11616061660 [https://perma.cc/KD3P-9SNZ]. ↩
- McDonnell v. United States, 136 S. Ct. 2355, 2373-75 (2016). ↩
- Editorial Board, Virginia’s Toothless Ethics Reform, WASH. POST (Mar. 4, 2015), https://www.washingtonpost.com/opinions/virginias-toothless-ethics-reform/2015/03/04/eca06542-c29a-11e4-9271-610273846239_story.html [https://perma.cc/4ZNP-5AUZ]. ↩
- COALITION FOR INTEGRITY, supra note 17, at 5. ↩
- See Kelly v. United States, 140 S. Ct. 1565, 1571-72. ↩
- BETTER GOV’T ASS’N, 2013 BGA-ALPER SERVICES INTEGRITY INDEX 3 (2013) (opening letter from Better Government Association President and CEO Andy Shaw). ↩
- Id. at 8. ↩
- Kelly, 140 S. Ct. at 1571; see also N.J. STAT. ANN. § 2C:30-2 (West 2021) (effective Sept. 1, 1979). ↩
- See, e.g., State v. Dougherty, No. A-3079-18T3, 2021 WL 137900 (N.J. Super. Ct. App. Div. Jan. 15, 2021) (prosecuting township Commissioner for accepting bribes while in office); State v. Longo, No. A-1769-15T3, 2018 WL 1569322 (N.J. Super. Ct. App. Div. Apr. 2, 2018) (prosecuting North Bergen Township Department of Public Works supervisors for misappropriating public resources for private use). ↩
- COALITION FOR INTEGRITY, supra note 17, at 1-2. ↩
- Id. at 5. Perhaps most surprising was Virginia’s exclusion in C4I’s report due to its agencies lacking enforcement power, especially given the public visibility of the investigation into former governor McDonnell. ↩
- Id. at 9-10. ↩
- Id. at 9. ↩
- Id. at 21. ↩
- Id. at 31. ↩
- COALITION FOR INTEGRITY, supra note 17, at 16. ↩
- Id. ↩