transportation and communication not only enable the criminal to speed away
from the scene of his crime to another jurisdiction, but, in some cases, enable
him to conspire in one state to commit unlawful acts in another under circum-
stances likely to complicate the prosecution of his crime. These factors have
given many offenses an interstate rather than a purely local character. In any
event they have created a national problem." -
The interstate problems associated with bank robberies did not disappear along
with Dillinger and gangs which flourished during the thirties. In fact, with the
development of a national interstate highway system and improved air transpor-
tation, today's criminal enjoys a mobility never before known, making banks even
more vulnerable to losses resulting from interstate criminal activity. For exam-
ple, in the 1970 Annual Report of the Attorney General, J. Edgar Hoover. Direc-
tor of the Federal Bureau of Investigation, reported the apprehension by federal
authorities of a bank burglary gang which operated for four years in the South-
eastern United States.' The gang was allegedly involved in 45 bank burglaries
resulting in losses of over $375,000. The FBI Director also reported an all-time
high total of 2.7S() violations of the Federal Bank Robbery and Incidental Crimes
Statute in fiscal year 1970.^ In the succeeding fiscal year, 1971, violations of the
statute increased 20 per cent to 3,354 (2,565 robberies, 471 burglaries and 318
larcenies).^ Convictions in cases investigated by the FBI and prosecuted in
federal courts reached a record high of 1,613. Savings and recoveries in these
cases amounted to $3,554,706, with 770 fugitives located under this category.*
During 1971 the federal bank regulatory agencies reported losses in excess of
$35,000,000 in bank defalcations of $10,000 or more.'
The dimensions of these statistics alone suggest that the bank crime problem
continues to be national in scope and that federal assistance is needed to
strengthen and improve the local machinei-y of law enforcement. Furthermore,
the maintenance of a healthy banking system, backed as it is by a federal insur-
ance program, is uniquely a federal concern and, for this reason, should be sup-
ported by the entire array of federal investigative and prosecutive forces. More-
over, we support the view that federal jurisdiction should extend over "local"
bank burglaries, robberies and defalcations, primarily because of the difficulty
in determining when such crimes are localized and when they are not.
One further comment on jurisdiction : We note that if the Code is adopted in
its present form, federal jurisdiction over crime will be greatly expanded. Any
such expansion, we assume, will necessarily increase the burdens placed on
1 Act of May IS. 1934, ch. 304. 4S Stat. 783.
2 American Bankers Association Journal, August 1934, at 34-35.
3 1970 Att'y Gen. Ann. Rep. 145.
5 1971 Att'v Gen. Ann. Rep. 116.
â– ^ Based on reports from the Comptroller of the Currency, Federal Deposit Insurance
â€¢Corporation, and Federal Reserve Board as compiled by the Insurance and Protective
-Committee, The American Bankers Association, June, 1972.
federal investigative authorities and, in such event, the banking community con-
siders it essential that the present FBI attention to bank-related crimes be in no
way diluted by the assumption of added responsibilities.
Aside from our views on the question of jurisdiction, the Association would
like to add these comments :
We recognize that the present title 18 of the United States Code contains ar-
chaic language, duplicative law and, often, inconsistent provisions and penalties
and note that the Commission's report thoroughly documents the need for penal
law reform legislation. Nevertholess, we note a dangerous tendency in the di'aft
legislation to replace existing limited statutes with unnecessarily broad lan-
guage. For example, some provisions are so phrased that they may easily be
read to proscribe a multitude of legitimate activities now engaged in by corporate
officials and fiduciaries.
It is the position of the banking community that the kinds of conduct which
should be circumscribed can appropriately be covered by substantially narrower
statutes. Therefore, the Association would like to offer its assistance to the
subcommittee in its further consideration of the specific language of provisions
which are of concern to banking.
Comments by Robert F. Steadman
(Formerly Staff Director of the Committee for Improvement of Management
in Government, which prepared Committee for Economic Development Policy
Statement on "Reducing Crime and Assuring Justice"')
Mr. Chairman and Members of the Committee :
Opportunity to comment xipon the policy questions raised by the final report
of the National Commission on Reform of Federal Criminal Laws is greatly
appreciated. I was privileged to be Staff Director for the development of the
recent policy statement by the Committee for Economic Development on "Re-
ducing Crime and Assuring Justice." I propose, therefore, to outline some of
the main conclusions contained in that statement, and to offer personal opinions
on certain matters not covered in the statement, in my capacity as an individual
citizen recently retired from my official connection with CED.
CED undertook its study of the crime problem in the United States because
of a growing recognition that national stability â€” including economic stability â€”
is under grave threat from the rising tides of crime of almost every kind and
description over the past decade. Crime rates have long been much higher here
than in other industrialized countries, but, according to FBI reports on of-
fenses known to the police, the fotir crimes of violence (criminal homicide,
forcible rape, robbery, and aggravated assault) have now tripled in number
.since 1960. And the three crimes against property (burglary, larceny over $50,
and auto theft) have also tripled. Addiction to dangerous drugs has escalated
explosively, and the depredations of organized crime continue on a massive scale.
As business leaders, CED Trustees have firsthand knowledge of the enormous
cost of crime to American business, which was estimated by the U.S. Depart-
ment of Commerce at $16 billion for 1971. Even larger costs are borne by indi-
vidual citizens, and these burdens, both social and financial, continue to grow.
The CED policy statement stresses the primary responsibilities of the 50
states for the administration of criminal justice, including the terms of the
criminal codes, police protection, prosecution of offenders, provision of proper
judicial processes, and correctional institutions and arrangements. At the same
time, it is fully recognized that the sweeping expansion of criminal conduct is a
nationwide problem, even above and beyond such fields as dangerous drugs and
organized crime, where the separate states can hardly be expected to find satis-
factory ansv/ers. Any nationwide problem calls, of course, for a national solu-
tion. This, together with the slow and inadequate response of state and local
authorities in meeting the challenge, has led to pressures on Congress to find
and to apply effective measttres.
Congress has taken many constructive steps, without which the national con-
dition would be worse than it now is. Extension of the list of federal crimes
together with stronger national enforcement agencies, has been beneficial. Con-
gressional decisions on this subject, over the years, have had general public ap-
proval, and should not be casually undone. But the hard fact remains that the
levels of criminal activity and the sense of personal insecurity among American,
citizens continue to rise.
The CED policy statement takes the position that new measures, and very
strong measures, must be taken to bring this situation under control. Most of
the many specific recommendations call for action at the state level, but past
experience shows that most of the states are unlikely to move quickly enough
to arrest the dangerous trends of these timesâ€” at least, without heavy incentives
and powerful stimuli. Hence, the national government must provide vigorous
leadership and major financial support if the sweeping changes so clearly needed
are to take place. In this view, the role of Congress becomes crucial.
The CED statement stressed the importance of revision of the state criminal
codes, to bring them into closer harmony with present opinions of citizens con-
cerning criminal conduct, strengthening penalties and enforcement procedures
for offenses that endanger human lives and eliminating prohibitions against
actions not in fact injurious to society. Making mere possession of marijuana not
involving traffic or transfers to minors a misdemeanor rather than a felony is
certainly in line with this view. It may be the v\'iser course to eliminate pos-
session, as such, of small quantities of marijuana from the list of federal,
On handguns, the CED statement takes a very strong position. Rifles and
shotguns are specifically excluded from the recommendations. But private owner-
ship of handguns should be forbidden, except for truly antique weapons. Hand-
guns should be owned exclusively by state and national governments, and issued
on a returnable basis to security forces and to other authorized personnel on a
carefully restricted basis. Compensation should be paid to present owners who
turn in their handguns. Manufacture, importation, and distribution of hand-
guns and the parts and ammunition for them should be under complete federal
control. Handguns were used in 9,000 criminal homicides in 1971, with nearly
100 police oflicers as victims. This slaughter must be checked, and government
ownership of handguns appears to be a better hope than any licensing system
The CED statement makes no objection to the major statutory extensions of
federal criminal jurisdiction in recent years. There is, therefore, an implied
approval. There is a favorable reference to the Congressional action making
illicit organized gambling a federal offense. In my personal view, this is a great
step forward, and your Committee deserves full credit for it. As the CED state-
ment points out. there is no serious doubt that organized gambling activity is
one of the chief sources â€” if not the chief source â€” of illicit and untaxed reve-
nues for the organized crime syndicates in this country.
The expansion of federal police powers is clearly ligitimate and highly de-
sirable in fields such as hijacking, security thefts, credit card frauds, disposal of
stolen property, and other offenses presumed to involve interstate or foreign
commerce or that impinge in any way upon areas of federal authority.
Although the CED statement did not deal directly with the provisions of the
Federal Criminal Code, it did take positions that coincide in principle with .'â– sev-
eral of the proposed changes now under consideration. For example, greater care
and closer uniformity in imposing sentences is strongly urged, ilore systematic
and simpler classification of sentencing categories conforms with that posi-
tion, as do improvements in the provision of pre-sentence reports on individual
The pending changes in probation and parole arrangements are also In gen-
eral agreement with CED recommendations. About four times as many persons
are imder probationary or parole supervision today than are held in prisons,
making the conditions surrounding sentencing procedures and the terms of
sentences handed down matters of prime importance. Failure to require main-
tenance of minimum administrative standards seems regretable. therefore. A
maximum limitation should be set, for example, on the number of proliationers or
parolees to he supervised by each federal officer â€” in line with the widely recog-
nized understanding that this limit should not exceed 30 or 8.3 porsons. Fur-
ther, the organization and conduct of parole boards, together with the guide-
lines and conditions governing paroles, are proper subjects for statutory re-
The CED statement expressed grave coucern over evidence being brought to
light of widespread corruption of police and other law enforcement officials not
only in respect to illicit organized gambling but extending to the traffic in
heroin and other hard drugs. It is my view that Congress is to be highly com-
mended for making the bribery of state and local officials a federal crime under
certain conditions, and that this provision should be extended as broadly as
possible. No greater threat to the future of American society than this cor-
ruption of public officials comes to my mind.
Although many of the CED recommendations may be somewhat beyond the
scope of this hearing, I trust that I may be pardoned for calling attention to
several basic propositions advanced in that policy .statement :
1. Every aspect of the American "non-system" of criminal justice, particularly
at state and local levels, is in need of dra.stic reform. This goes far beyond the
criminal code.s, as such, to the quality of management of the nation's 32,000 police
for' es. the congestion in the courts, the weaknesses and overstaffing in prosecu-
tors" offices, and the nature of correctional efforts.
2. Piecemeal improvements in one or another of these vital areas will not do
the job. To quote from the policy statement : "More arrests create complications
where jails are overcrowded and courts are clogged with long-standing unsettled
eases. More judges and prosecuting attorneys avail little while correctional
institutions have no room for those convicted and sentenced. Doubling the num-
ber of prison cells of the kind now in use is a dubious expedient when two-thirds
of those released return within a few mouths, convicted of new crimes. A total,
all-embracing '.systems' overhaul of the present 'non-system' of criminal justice is
an absolute necessity."
3. The states have a primary responsibility in all these matters, and they
should not continue to depend upon the fragmented and weakly managed patterns
of local government prevailing in most areas either for the maintenance of court
sy.stems, or the prosecution of offenses against .state laws, or confinement and
supervision of persons convicted. These are all, properly speaking, state func-
tions. CED's statement recommends expansion of state police forces and their
roles, but would leave local forces intact â€” although federal financial support
would be conditioned upon establishment and maintenance of high professional
and organizational standards.
4. The Trustees of CED are always reluctant to propose creation of any new
federal agency, but the extent of the present emergency is such that they con-
cluded, after examining every conceivalble alternative, that in this case it must be
-done. They recommend creation of "a Federal Authority to Ensure Justice" to
take an umbrella or overall view of the entire national situation in respect to
criminal justice, to provide up to half of all state expenditures and all costs of
local police forces subject to conformance with minimum prescribed standards,
and to manage directly certain functions such as the collection and analysis of
statistical data, the provision of educational and training facilities, and research
in depth by contract or other means. This proposal is outlined in greater detail,
of course, in the policy statement.
May I express, again, my gratitude for this opportunity to review CED's major
Ijroposals in this field, and to express an occasional opinion in the extremely
vital work that now engages this Committee.
Federal Public Defender,
Central District of California,
Los Angeles, Calif., March 27, 1972.
Mr. Robert H. Joost,
Asslstatit Counsel. Senate Judiciary Committee, Subcommittee on Criminal Laws
and Procedures, Washhigton, D.C.
Dear Mb. Joost : Thank you for your kind invitation to comment on the Pro-
posed New Fedei'al Criminal Code. There has been some attempt to date to
channel individual Federal Public Defender views to the NLADA : however, it
was the hope of several of us that we might be able to prepare a statement repre-
senting a Federal Public Defender consensus. Unfortunately, time and operational
consideration simply have not given us that opportunity yet.
The most recent information I've received is that the current hearings are
intendei to cover general policy considerations and that further hearings will be
required. Can you give me any idea of tlie Committee's timetable? The establish-
ment of an honest deadline might impel some of my colleagues to start burning
the midnight oil.
It might be useful to summarize my feelings on some of the major policy
Piggybacking: (Section 201b) A federal judicial sanction is required to termi-
nate federal prosecution where the offense primarily affects state, local or foreign
interests and local law enforcement is intent on proceeding.
Civil Rights: (1.501 & 1502) The new section should be supported and updated
in line with the suggestions in the Comment.
Firearms: I strongly support the recommendations of the Commission to ban
the production and possession of and traiBcking in handguns (with the exceptions
noted), and the required registration of all firearms.
Drugs: Public Law 91-513 should be assimilated into the new code, with tfie
adoption of lower penalties suggested in the provision's final draft.
Death Penalty: (3601) I urge the complete abolition of the death penalty.
Reduction of Class of Offense: (3001) While I disapprove giving the Court the
power to reduce the class of offense as some Commission members suggested I
urge that the prosecution be given the power to reduce the class of the offense,
based on "the nature and circumstances of the offense" and the "history of the
defendant." This is particularly desirable for plea bargaining and dispositional
purposes, particularly since the Code has less flexibility than the present criminal
code in finding included offenses of a lesser nature upon which a disposition might
Imprisonment: [Minimum Term, 3201(3)] The Parole Board alone should be
given the power to set the minimum term and the parole eligibility dates ; the
Court should be limited to setting outside maximum sentences.
Appellate Revieiv of Sentences: (28 U.S.C. 1291) I support a limited appellate
review of sentencing, e.g. an appellate review of a motion to decrease in felony
cases where incarceration exceeds half the maximum term possible.
I hope to hear from you shortly on the Committee's timetable and hope that the
Federal Public Defenders can play some role in the culmination of this bene-
John K. Van De Kamp.
Federal Public Defender.
Staff StJEVEY, Committee on the Judiciaey. Subcommittee on Criminal Law
AND Procedures, U.S. Senate
comments on proposals to make certain anti-trust violations class c
On May 23. 1972. Mr. Ralph Nader testified before the Subcommittee on
Criminal Laws and Procedures and advocated that certain antitrust violations be
punishable as Class C felonies under the penalty structure of the proposed reform
federal criminal code.
To obtain a variety of expert opinion on Mr. Nader's proposal, the following
letter was sent to 176 law school professors specializing in the antitrust area :
"The Subcommittee on Criminal Laws and Procedures is considering a revi-
sion on the criminal law of the Federal government. Our 'work basis' is a pro-
posed new Federal Criminal Code prepared by the National Commission on
Reform of Federal Criminal Laws.
"The Commission recommended, among other things, that major criminal
offenses now found in other Titles of the United States Code be transferred to
Title 18 to become part of the Criminal Code. Thus, income tax evasion, securities
violations and banking violations would become part of Title 18 under the
"The Commission did not include anti-trust crimes in this category. However,
in hearings this week. Mr. Ralph Naner testified thDt :
" 'Most importantly, anti-trust crime must be brought within the purview of
the proposed revisions to Title IS. Given the prevalence and costs of antltr'T^t
illegality, it should be a Class C felony, thereby involking related sections of the
Code . . . For those who presently scoff at anti-trust crimes as merely a misde-
meanor, this incorporation would properly stress the seriousness of such
offenses . . .'
"Nader proposed that conduct which now constitutes a 'per se' violation of tlie
Sherman Act (price-fixing, etc.) should he incorporated by reference, or the
case law codified, as the new anti-trust felony.
"As a professor who teaches anti-trust law, your opinion on this suggestion
would be of real value to the Subcommittee. Moreover, if you agree with the
position advanced by Mr. Nader, you could be of great assistance to the Congress
if you could draft a proposed section. I assure you that such a draft would be
given the closest possible attention by the Subcommittee.
"Enclosed is a copy of the complete Draft prepared by the National Commis-
sion, which was included in our first day of hearings. If you have any questions
or other comments on the Code, please feel free to contact the Chief Counsel of
the Subcommittee, Mr. G. Robert Blakey at Area Code 202/225-3281."
The response to the survey, while not as large as it might have been, did provide
a great deal of informed commentary that may be of assistance in the processing
of the Commission's recommendation.
Most of the replies expressed agreement that anti-trust laws should be made
more effective, but indicated that there were serious difficulties with Mr. Nader's
approach to the problem. Professor Dennis L. Rouseau of Loyola University bas-
ically shared Mr. Nader's views. Other professors offered the objections which
The most common objection was that the imposition of criminal penalties would
result at most in marginal increase in prosecutions and deterrence. Indeed, sev-
eral of the professors doubted that more severe penalties would be imposed be-
cause, as Professor Lino A. Graglia, University of Texas at Austin, stated,
"present penalties are virtually never fully imposed." Professor Charles A, Sulli-
van of the University of South Carolina elaborated on this point :
"First, I would like to take issue with the apparent rationale that such a'
change would significantly contribute to deterrence of antitrust violations. The
present misdemeanor penalties, including a $50,000 fine and up to one year im-
prisonment, are, when coupled with the possibility of civil liability at a penal
treble damage rate, significant disincentives to violation. Whatever added de-
terrence might result from making certain violations Class C felonies would
surely be marginal. It is, of course, true that even a marginal increment to de-
terrence may be desirable if it can be purchased at an acceptable cost. However,
in my view the costs of this proposal are much too high to justify the slight ad-
vantage to be gained."
Professor George J. Alexander of the University of Santa Clara extended the
notion further and suggested that more stringent penalties would be even more
rarely invoked than present penalties. The reason for this was pointed out by
Professor Alfred P. Rubin of the University of Oregon who suggested that many
public officials do not feel the nature of the offense merits criminal penalties.
Professor Rubin stated :
"... I suspect the problem with regard to the enforcement of criminal sanc-
tions with regard to the antitrust laws has not been the absence of sufficiently
stiff penalties, but the feeling of judges and the responsible officials of the Justice
Department that criminal penalties ought not to be enforced. I wonder if a
better approach to the whole problem might not be legislation to amend the secu-
rities laws to forbid any company to pay any compensation to a person who within
five years preceeding has been a member of the Board of Directors, President,
Executive Vice President or General Counsel of any enterprise found guilty
of violating Section 1 or 2 of the Sherman Act."
Harvard Law School professor Donald F. Turner's letter links together the two
most predominant objections to the Nader proposal : that the effect would be min-
imal, and that there would be an insuperable definition problem. Professor Tur-
ner wrote :
"As is well known, jail sentences for antitrust offenders have been few and far