Imagine the national outcry if hundreds of Fortune 500 corporations were discovered to be routinely falsifying their tax returns in order to qualify for tax credits worth billions of dollars.
And what if it was further learned that some accounting firms specialized in preparing fraudulent profit and loss statements to deceive the government and that the same firms also provided “experts” to help the corporations prepare equally fake supporting documents?
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Does anybody doubt that there would be a bipartisan demand in Congress that would force the president to take dramatic actionto investigate the scandal, identify and prosecute those responsible and recommend new laws aimed at preventing such frauds from ever again being perpetrated?
No imagination is needed to recognize the ill wind of a genuine national scandal of epic proportions blowing through the nation’s court system. It is the scandal of a relatively few well-placed class-action liability lawyers and equally corrupted professionals from other fields using false damage claims to enrich themselves by generating billions of dollars in legal fees and administrative costs, compensatory damage payments and other court-ordered reparations.
The public is just beginning to get a glimpse inside this putrid realm of legalized theft that was recently branded by the government in one case as a long-running “racketeering enterprise” and in another by a disgusted federal judge as “diagnoses … manufactured for money.”
The former is the government’s indictment of the Milberg Weiss class-action law firm that has resulted in multiple guilty pleas by senior partners for participating in a multidecade scheme to bribe lead plaintiffs. The latter is Judge Janis Graham Jack’s dismissal of all but one of 10,000 claims of medical harm in a Texas silica case.
Law professor Lester Brickman estimated yesterday in the Wall Street Journal that “mass tort fraud” has cost at least $30 billion just in the last 15 years. He noted that there is “compelling evidence” that many if not most of the medical reports supporting more than 700,000 damage claims filed in asbestos, silica, diet drug and silicone breast implant litigation are frauds.
Brickman wonders why the Justice Department has not been much more aggressive in going after such fraud. Since class-action lawyers are among the biggest contributors to Congress, concrete action seems unlikely from that corner. So it’s up to President Bush to take the lead by appointing a special investigative panel to expose the true extent of this burgeoning affront to justice. Judge Jack seems like the ideal candidate to lead the panel and there is no time to waste.
