Public shaming has reached new levels in Utah. In February 2016, the state
became the first to publish an online registry of white collar crime offenders.
The Utah White Collar Crime Offender Registry (“Registry”) has been a long-time
goal of Utah Attorney General Sean D. Reyes, who statedthat “[w]hite-collar crime is
an epidemic in Utah.”
According to Attorney General Reyes, the Registry “will further
equip citizens to protect themselves from financial fraud by making information
much more accessible in this digital age.” The two primary motivating factors
behind the creation of the Registry appear to be protecting investors and
incentivizing the repayment of restitution.
In addition, when legislation for the Registry was
introduced, Attorney General Reyes alluded to what may be a
third factor—“Utah’s unique personal interweavings and close
relationships”—noting that Utah citizens trust those in their neighborhoods,
churches, and professions. Attorney General Reyes went on further, stating, “[w]hile in many ways trust
is a healthy community trait that fosters social strength and business success,
it also leaves [Utah] citizens quite susceptible to those who would exploit
that trust.”
This rationale—which seems to imply that Utah citizens are overly
trusting and therefore need protection from the state—is questionable at best
and borders on paternalistic.
A recent press release from the Utah Office of
the Attorney General touts the Registry as a tool that “protects future
investors, deters fraudsters and incentivizes restitution by allowing removal
from the [Registry] after full repayment.” However, it is unclear how effective
the Registry will be. First, the information provided on the Registry may not
always be correct. Online visitors must acknowledge a disclaimer before entering the
Registry that states, “the attorney general does not guarantee the website’s
accuracy or completeness.” Second, the information provided on the Registry is
already public information, meaning anyone—including investors—can already
access it.
While publication to a searchable online platform may make the
information more accessible, it isn’t necessary. Finally, it is uncertain
whether removal or exclusion from the Registry will sufficiently incentivize
repayment of restitution. In addition, tying removal and exclusion from the
Registry to an individual’s ability to repay restitution may burden those
individuals with limited financial means.
It appears that the only other similar registry maintained in Utah is an
online sex offender and kidnap offender registry—meaning the state has chosen
to single out individuals convicted of financial crimes for inclusion on a
public registry over individuals convicted of other crimes, including violent
offenses. The rationales offered for creating the Registry are not sufficient
to justify equating white collar offenders to sex offenders and kidnappers.
This, coupled with a Registry that is likely to be ineffective and unnecessary,
leads one to conclude that the true justification for the Registry is shaming
white collar offenders into paying restitution.
Indeed, one of the sponsors of
the bill creating the Registry, Representative Mike McKell, acknowledged that
this may amount to a “scarlet letter” and stated, “I’m comfortable with that.
If it’s a public shaming to the extent that it’s someone that’s stripped
retirement accounts from seniors, I’m okay with that.”
Publication to an online forum also raises significant concerns related to
privacy and the potential harassment of listed offenders. The Registry provides
extensive information for each listed offender, including the offender’s full
name, any aliases, date of birth, height, weight, eye and hair color,
qualifying conviction(s), summary of offense(s), and recent photograph. Over
100 individuals are currently listed on the Registry, although this number is
expected to rise to approximately 230 individuals over the next several months.
Individuals Required to Register
Per Sections 77-42-105 and 77-42-106(2) of the Utah Code, individuals
convicted after December 31, 2005 of a second degree felony for any of the
following offenses are required to register with the Utah Office of the
Attorney General:
·
Securities fraud;
·
Theft by deception;
·
Unlawful dealing of property by fiduciary;
·
Fraudulent insurance;
·
Mortgage fraud;
·
Communications fraud; and
·
Money laundering.
Individuals remain on the Registry for ten years for a first offense, and
for an additional ten years for a second offense. If convicted of a third
offense, an individual will remain on the list for a lifetime.
Individuals Excluded from the Registry
Individuals are not required to register if they have (1)
fully complied with court orders at the time of sentencing; (2) paid all court
ordered restitution in full; and (3) not been convicted of any other offense
for which registration is required. See Utah Code § 77-42-106(3)(a)-(c).
Removal from the Registry
Removal from the Registry is possible, but requires full repayment of any
court ordered restitution. The Utah Code and the Utah Administrative
Rules outline the procedures for removal.
Utah’s White Collar Crime Offender Registry is the first of its kind in the
country, and will hopefully be the last. It is unlikely that this type of
registry will serve as an effective or even necessary tool to protect
investors, ensure repayment of restitution, or deter future criminal conduct.
In addition, serious concerns related to privacy and public shaming should
dissuade other state legislatures from enacting similar registries.
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