Donald Trump’s bombastic campaign to restore law and order is focusing on minor crimes like vandalism while allowing much more serious corporate offenses to go unaddressed. Federal agencies such as OSHA are failing to fulfill their regulatory responsibilities, putting lives at risk.
Not only is the government failing to crack down on business miscreants — in some cases it is using tax dollars to give them grants and loans to weather the pandemic-generated economic crisis.
These are not just companies involved in civil infractions but also some that have faced actual criminal charges, which are rarely used against corporations.
So far, the limited information released by the Administration on the recipients of CARES Act assistance has involved two main groups: hospitals and other healthcare providers, and airlines and air cargo companies. Even within this limited universe we can find firms that have been embroiled in criminal cases.
One example is National Air Cargo Group, which recently received a grant of more than $15 million through the Payroll Support Program. In 2008 the company had to pay $28 million to resolve criminal and civil allegations that it defrauded the Defense Department when billing for air freight services. As part of the resolution, National Air Cargo pled guilty to one count of making a material misstatement to the federal government and paid more than $16 million in criminal fines and restitution (the rest of the penalty total involved the civil portion of the case).
Among the healthcare providers there is the case of WakeMed Health & Hospitals, which is receiving more than $22 million from the CARES Act Provider Relief Fund. In 2012 it had to pay $8 million to settle criminal and civil allegations that it used more costly in-patient rates when billing Medicare for services that were actually performed on an out-patient basis. The non-profit health system was offered a deferred prosecution agreement but it had to admit to the wrongdoing.
Criminal cases can also be found among the larger corporations receiving covid-related aid. Take the case of the for-profit hospital chain Tenet Healthcare, which is getting more than $300 million from the Provider Relief Fund. In 2016 Tenet and two of its subsidiaries had to pay more than half a billion dollars to resolve criminal charges and civil claims relating to a scheme to defraud the federal government and to pay kickbacks in exchange for patient referrals. Tenet got a non-prosecution agreement while the subsidiaries pled guilty to conspiracy to defraud the United States and paying health care kickbacks and bribes in violation of the Anti-Kickback Statute.
In other words, the federal government is currently paying out hundreds of millions of dollars in aid to companies that have been implicated in criminal schemes to cheat that very same government.
The most odious abuses in the American justice system involve disparate treatment based on race, but there are also serious flaws in the way corporate offenders can so easily buy their way out of serious legal jeopardy. Allowing those offenders to receive federal aid is compounding the abuse.