Corporate Crime Reporter: Jeff Grant on Religious Ethics Versus Business Ethics
Jeff Grant is a white-collar defense attorney in Manhattan.
And he has an unusual back story.
More than twenty years ago, Grant lost his law license for dipping into client funds. He became addicted to prescription opioids and tried to kill himself. And he went to prison for more than a year for defrauding the Small Business Administration.
Since those traumas twenty years ago, Grant has undergone a transformation. He went to divinity school and became a minister. He started a ministry called Progressive Prison Ministries. He got his law license back and counsels people being prosecuted for white-collar crimes.
Every Monday, he holds a Zoom meeting with people around the country. It’s like AA for the white-collar community. (Grant himself has been to 10,000 AA meetings. In the early days of his recovery, he was going to three a day.)
In August of 2021, the New Yorker published a glowing profile of Grant’s work titled – “Life After White-Collar Crime – Every week, fallen executives come together, seeking sympathy and a second act,” by Evan Osnos.
“Almost everybody prosecuted for white-collar crime needs a lawyer to trust and someone who can empathize with them and understand the complexities of their problems,” Grant told Corporate Crime Reporter in an interview last month. “When they are being prosecuted for crime, they have many more problems than just their legal defense. They have bankruptcy issues, tax issues and maybe family issues. They also have spiritual and emotional issues. I try to take a look at the long game and help them forge a path from where they are, in a place of suffering, to a place in the future where they could hopefully have a happy, productive and happy life again. That’s a much larger view than a criminal defense lawyer might look at where they are simply trying to get the best sentence with the least amount of prison time.”
“I’m not saying that’s not important. That’s incredibly important. But the most important thing that I stress is that prison is not the worst thing that could happen to someone who is being prosecuted. Not having a comeback story is the worst thing that can happen. Thus far, the criminal justice system and the world in general has not shown a lot of compassion or empathy for people who have been prosecuted for white-collar crimes.”
“That’s changing as we have formed a community for a white-collar support group we started in 2016. We recently had our 300th meeting online on Zoom. We have been online since the very beginning. We are early adopters of the technology.”
“And we have over 500 members. We average about 40 people online every Monday night. There is a spiritual component. There is certainly an emotional component. But also we share a lot of information that is vital to successfully going through the process. And as a white-collar community, as we gain more information, we are best able to advocate for ourselves and defend ourselves. And we are no longer victims of the system.”
“There is a lot of information sharing. It’s run pretty much like an AA meeting. That’s the core of my sobriety. I have attended over 10,000 AA meetings at this point. On August 10, 2002, I will celebrate 20 years of sobriety.”
Is there a sense among some of your members that they too are victims of corporate crime, that the corporations in some cases have thrown them under the bus for higher ups in the corporation or the corporate criminal itself?
“It is such a complicated answer. The highest level answer I can give you is that everyone I have met who has been prosecuted for a white-collar crime has some kind of influence that has caused them to commit that crime. Whether it’s mental illness, substance abuse, childhood trauma, or social pressure, or business pressure to ride the line or cross over the line into some kind of unethical or criminal behavior.”
“These things generally do not happen in a vacuum. If you go deep enough into their history or their workplace, if you do real mitigation reports to learn the human side and the real intricacies of their business decisions, you find an amazingly rich story that humanizes the people accused.”
“Does corporate America throw its employees under the bus? The answer to that – it depends on the company. For the most part, large companies are represented by large law firms. They are trying to get either non prosecution or deferred prosecution agreements.”
“The corporations have huge resources they are able to apply. And typically when they are investigated, the question of whether any of the individuals of that corporation are going to be prosecuted is certainly up in the air. It’s part of the discussion. But historically, very few individuals are prosecuted up and down the line.”
“There are exceptions. Specific hedge fund traders have been prosecuted for insider trading. Sometimes they come to the attention of prosecutors because of a specific trade or series of trades. Sometimes prosecutors are trying to climb the ladder and get to superiors who they think are guilty of larger crimes or more institutional crimes.”
“It’s industry specific. Federal prosecutors have targeted healthcare companies over the last five years. In the future, it’s clear from the Attorney General’s recent comments in San Francisco that they are going to make individuals more accountable.”
“They are going to focus on new technologies where the law hasn’t quite caught up with the transactions. And they will focus on pandemic fraud prosecutions. SBA loans, PPI loans. I know a lot about that because I went to prison for an SBA loan. They are calculating that maybe as much as $200 billion or a million different loans were fraudulent in some ways. And those can be sizable companies. Those loans ranged from small loans to $10 million loans.”
“We are going to find that over the next five years, the floodgates will open in this area.”
You are saying that what leads these individuals to engage in white-collar crimes is a pathology – something triggered it?
We interviewed Joel Balkan who has written that corporations can be pathological. Is there a sense among the group of individuals that you have dealt with about systemic pathology as opposed to individual pathology?
“Absolutely. You could go company by company and find that kind of systemic pathology. And you can find a generally toxic business environment that has historically honored the wrong things. For the most part, the public corporations operate quarter by quarter. And they do things that you might consider to be unethical, or push their people to do things in order to get quarterly results that might achieve it for a while but ultimately eats away at the fabric of that corporation and of the people who work at that corporation. There are many examples of where the corporate culture itself is so toxic that it has created an environment where for example its sales people are committing acts of bribery in violation of the Foreign Corrupt Practices Act.”
“What we are finding in the support group is that people have been asked to do things that they otherwise wouldn’t have done. Or it happens inch by inch so that they wake up one day and they find out they are over the line of ethics and legality. And they are not even sure how they wound up over the line other than the fact that their company has made them do it. They were making poor decisions. And second, the line keeps shifting as to what is ethical and legal.”
“A perfect example of that is insider trading. The last ten or fifteen years, the definition of insider trading keeps changing. How close to that line do you get to satisfy your employers? Almost every employer in the hedge fund industry wants their people to get as close to the line as possible. People in our support groups represent that experience.”
The Justice Department is heading back to the Yates memo calling for a renewed focus on individual wrongdoing in corporate crime prosecutors. Is this a good policy – to focus on individual wrongdoers within the corporation? Does it work in deterring crime?
“I don’t know if it deters crime. The benefits can be so disproportionate to what they perceive the risks to be. Example – you are a young person who has just come out of business school. And in your mind, you think you are going to make $30 million. How much deterrence would these prosecutions have if realistically you were told that one or two percent of the people who engage in this kind of criminal behavior are ever prosecuted?”
“You might view it as a minimal risk. The government doesn’t have the resources to go after enough people for there to be real deterrence.”
If not by criminal prosecution, how should the government deter wrongdoing?
“Let me answer your previous question – do I believe individuals should be prosecuted? The answer I have, both as a minister and as a lawyer, is that everybody should be held responsible for their behavior. Do I think that the prosecutor should understand all of the elements, including the personal elements? Yes. But anybody who overtly committed a crime should be prosecuted.”
“Should they go to jail? Jail is a draconian, inartful way of dealing with crime, rehabilitation and punishment. There are much better alternatives that work in other countries – Germany and Sweden for example. People can be held responsible for their behavior, but we would not be destroying people and grinding them up in the process and leaving them without the possibility of using their experience and education to better society.”
“There is a movement to do better.”
“As for deterrence, deterrence is a strange word. We have moved away from morals and ethics. The root is societal and cultural. Our colleges and universities were formed originally as seminaries and we taught morals and ethics. When they became professional schools and business schools, they traded religious ethics for what they call business ethics. Business ethics haven’t worked. It was a form of self-policing that created a culture that has undermined business. There has been push back recently. Now the business schools and law schools are teaching real courses in ethics and right and wrong, things you should have learned in kindergarten. But it took a lot to get there.”
How is religious ethics different from business ethics?
“Religious ethics is teaching a basic system of right and wrong, about what is healthy, unhealthy. It’s character building. You build your character and come closer to God.”
“Business ethics is about the health of the corporation and delivering value to shareholders. It’s a twisting of ethics to satisfy the needs of the business in the name of capitalism. But they disregard all the other stakeholders – including the planet, poor people, people who need resources but don’t have access to them. I’d like to think that in some ways we are moving back to a more humane and ethical understanding. But if you look at the number of billionaires and the disparity of wealth, we have a lot of work to do.”
A St. Francis style religious ethics would do away with most of the corporate state, wouldn’t it? It would oppose the military industrial complex – large parts of the economy. The healthcare industry would be transformed. Business ethics protects the corporate state while religious ethics would undermine it.
“I agree with that. To become the most powerful country in the world, we had to lose our religious underpinning.”
These 500 white-collar criminals who have gone through your program, how do they view the issue of corporate power and corporate crime?
“Everyone who goes to prison undergoes a transformation whether they know it or not or understand it or not. They come out different. Generally, the people in our white-collar group start off as people who are very material. Then somewhere in the process, they find their spirituality. Most of them commit themselves to a life of more spirituality and less materialism. You won’t find anybody who doesn’t acknowledge that they lived a hollow material life. And now what they want is a more meaningful and joyful life.”
“And it’s not all or nothing. Most people when they come out of prison, they are in survival mode. They are ex CFOs who are now driving for Doordash. Just survival is difficult. They have a new definition of success. The road back is through some spiritual component.”
[For the complete q/a format Interview with Jeff Grant, see 36 Corporate Crime Reporter 17(11), April 25, 2022, print edition only.]