The Structure of Government

To understand corporate fraud, we should begin with a basic review of how our nation’s founders structured our government. Almost all people that attended school in America remember that we have three separate branches of government:

• Legislative Branch: Includes the Senate and the House of Representatives. In these two houses of Congress, legislators pass laws that people in our country must follow. The Congress also controls the country’s budget.
• Executive Branch: Our president leads the Executive Branch, signing legislative bills into law, and overseeing numerous administrative and law-enforcement agencies to ensure people comply with the laws.
• Judicial Branch: The president appoints judges at the district court level to make factual findings, appellate court judges to assess due process in the lower courts, and the Supreme Court, which has the final say over all courts in the United States.

Since we declared our independence, our nation’s government has grown. As a result, every individual and every business is subject to following more than 4,500 laws and millions of pages of regulations in the federal system. Besides the federal system, each of our 50 states has its own body of laws. Like the federal government, each state has many regulatory agencies and law enforcement divisions that enforce compliance.

Despite starting with an intent to create jobs and solve problems for customers, on any given day, business leaders could violate regulations or laws. Sometimes, decisions made in the course of business can lead to civil or criminal investigations. Sadly, investigators can also draw rank-and-file employees into those investigations.

The investigations may start in any number of ways. Ordinarily, they begin in secret. Investigators gather information with hopes of building a case. They may seek documents to review. They may identify people with whom they want to speak:

• As witnesses to a government investigation,
• As subjects to a government investigation, or
• As the target of a government investigation.

Whether a person responds as a witness, a subject, or a target, when people respond to government investigators, they expose themselves to potential liability. Despite not knowing whether they’ve done anything wrong, people may face civil or criminal charges for corporate fraud, obstruction of justice, or any number of white-collar crimes.

With so much at stake, it makes sense for people to learn as much as possible about government investigations and how they operate. More knowledge about government investigations will help people make better decisions. In some cases, it makes sense for companies or individuals to hire an experienced white-collar criminal defense lawyer to review compliance programs and get an opinion on levels of exposure to government investigations.