The Senate Judiciary Committee hearing on Eric Holder's nomination for attorney general has failed to focus on the threat to constitutional rights posed by what is known as the "Holder Memorandum." Near the end of the Clinton administration, this memo changed Justice Department policy regarding the formerly unquestioned right to counsel and to confidential communication with one's counsel.
The Holder memo allowed federal prosecutors to demand waiver of these rights in exchange for characterizing a corporation as "cooperating in an investigation" so that it would not be charged with a crime itself. It thus handed prosecutors a powerful weapon in white-collar criminal investigations.
But the result has been a "culture of waiver" in which employees often must choose between their jobs or going to prison, and employers are increasingly reluctant to conduct internal investigations or seek candid legal advice from counsel, lest they be forced to turn over to the government a road map for prosecuting the company.
Much of the 1999 Holder Memorandum is an unobjectionable discussion of factors federal prosecutors should consider in making decisions whether to bring criminal charges. But several of the listed factors struck at the heart of the right to counsel and the attorney-client relationship, as well as the presumption of innocence.
The attorney-client privilege has been protected for centuries by courts and attorneys. Most corporate bylaws and state courts protect an employee's access to adequate legal defense counsel when a criminal investigation relates to some action an individual took in his capacity as employee. But beginning with the Holder memo -- and continuing in two subsequent memos issued in the next administration -- employees not yet convicted (or even charged) were caught between prosecutors who used them as bargaining chips and the companies who employed them but wanted to be deemed "cooperative."
It is our hope that in his confirmation hearings, Mr. Holder will provide assurances that he will review and reverse the effects of his 1999 memorandum.
As is clear from what happened to international accounting firm Arthur Andersen and its 28,000 employees, for many companies federal indictment is instant death. Appellate review comes too late. Because Andersen ceased to operate long before what was left of the firm went on trial, the U.S. Supreme Court's reversal of its tenuous conviction was a Pyrrhic victory incapable of bringing the firm back to life or restoring its employees' careers.
The Holder Memorandum policies forced companies under federal investigation to provide the government as much incriminating evidence about their employees as possible. Employers would pressure employees, on threat of termination, to give statements that compromised their Fifth Amendment right against self-incrimination and Sixth Amendment right to counsel. The choices were draconian, regardless of how loyal and well-meaning the employer and employee might be.
Since the Justice Department is the primary federal law-enforcement organization, its policies and practices set the tone for other federal agencies. Similar policies were adopted by the Internal Revenue Service, the Environmental Protection Agency, the Securities and Exchange Commission, the Department of Housing and Urban Development, and others.
The same day in 2008 that the Justice Department issued new, greatly improved -- but regrettably still inadequate -- guidance, the Second Circuit Court of Appeals in New York affirmed an important decision by District Judge Lewis Kaplan in a tax-fraud prosecution of former employees of accounting firm KPMG. Judge Kaplan had held that federal prosecutors, following Justice Department policies, forced the employer to cut off payment of legal fees and otherwise prejudice its employees' rights, thereby violating 13 individuals' Sixth Amendment right to counsel. The appeals court affirmed Judge Kaplan's findings in all respects.
Legislation may be the only way to ensure that these unconstitutional practices are ended. No one questions that we must prosecute white-collar crime vigorously, especially in light of the financial debacles of the past two years. And, like many other questionable tactics, forcing privilege waivers does make the prosecutor's job easier. But the legitimate goals of law enforcement that Mr. Holder had in mind when he issued the Holder Memorandum do not justify chilling the exercise of legal and constitutional rights of employees to seek advice of counsel, and, if they choose, to mount a legal defense. There are reports that some of the far-reaching consequences of the Holder Memorandum were unforeseen by its author. If so, the most straightforward path to rectifying what has gone wrong would be for Mr. Holder to declare in his confirmation hearings that he supports legislation like the Attorney-Client Privilege Protection Act and will work with Congress to enact it.
EDWIN J. MEESE III, the attorney general of the United States from 1985 to 1988, is Chairman of The Heritage Foundation's Center for Legal and Judicial Studies. ARLEN SPECTOR, a United States senator from Pennsylvania, is the Ranking Member on the Senate Judiciary Committee.
First appeared in the Wall Street Journal