Hillary Clinton, Truthfulness, And Bias In White-Collar Cases

Hillary's issues are no different than those facing defendants every day.

Hillary Clinton (Photo by Chip Somodevilla/Getty)

Hillary Clinton (Photo by Chip Somodevilla/Getty)

Here’s something that happens in just about every criminal investigation — some notion settles in the prosecutor’s mind that is wrong, but that organizes how the prosecutor views every bad fact in the case.

To have an example to make this concrete, let’s say that your client has applied for a series of bank loans, and the prosecutor thinks that each one contains a false statement. The question is whether your client knew those false statements were false when they were made.

Suppose there are no emails or contemporaneous writings. The only things we have to go on are the nature of the false statements and whatever else we know about your client. Suppose, further, that the false statements don’t decide the issue. It’s not like the guy is reporting $8 million of income on a loan application when he only made $80,000, but it’s also not the case that he said he owed $325,000 on his mortgage when he, in fact, owed $326,872. The false statements are frequent enough and serious enough to draw attention, but not so serious and frequent that they, on their own, push things over the edge into being indicted.

Most importantly, assume that the prosecutor thinks your client is worth spending her time investigating because she believes that he is shady. Not in any specific way — there’s no one thing that she can run to ground that shows that the client is shady — its more just that the client has been around things that have been shady. Maybe he worked for a mortgage broker with a bad reputation for a while. Perhaps he was sued for fraud, but the case was dropped before the allegations were really addressed. Little things like that build up; and in a world where you’re, sadly, relying on a prosecutor to give your guy the benefit of the doubt, things that can create a cloud can be enough to keep the government digging until it finds a reason to indict.

This happens all the time in white-collar cases. The government looks at what happened through the lens of a dirty window — and everything they see looks dirty.

I once had a magistrate judge at a detention hearing determine that my guy was more likely to be a danger to the community because he owned a roller-skating rink and the judge said, “I know what roller-skating rinks are all about.” I didn’t. I still don’t. I thought roller-skating rinks are mainly where small-town teens in the 80s awkwardly try to talk to members of the opposite sex while falling down because they have wheels on their feet. I suspect that’s not where the judge was coming from.

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The hearing didn’t work out well for my client.

This is a recurring and maddening problem with white-collar cases; people who are flawed, to be sure, but often one flaw is mistaken for another. The client who is an idiot who doesn’t know how to fill out a form is taken as a liar who is defrauding the bank. Or, to take a real-life example, the woman whose husband can’t fill out a financial aid form is seen as structuring.

The same thing happens in political campaigns, which is one reason why election season can be tremendously interesting for lawyers of all stripes.

Clinton is widely believed to be a frequent liar and untrustworthy. Something like 40% of the population thinks she’s untrustworthy.

But is that accurate?

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Happily, PolitiFact rates politicians for truthfulness, putting politicians’ statements on a six-point scale ranging from true to pants on fire. As of June 26, for the 2016 campaign for both Democrats and Republicans, Hillary Clinton had one “pants on fire” statement — the same as Chris Christie, Jeb Bush, and Rand Paul. And fewer than Marco Rubio or Ted Cruz. Ben Carson had four. Donald Trump had 30.

Compare the false statements made by Hillary Clinton with, say, John Kasich. When you combine the three categories of false claims, they made up 32% of Kasich’s statements. The same three categories for Hillary Clinton made up only 27% of hers.

Five percent of Kasich’s were rated pants on fire, while only two percent of Clinton’s were.

(To be fair, far more of Clinton’s statements were fact-checked because she was in the race in a high-profile way for much longer. Though I’m not sure which way that cuts.)

So, if that’s right, it looks like Clinton tells the truth at a slightly higher rate than John Kasich. Yet Kasich is perceived as the reasonable moderate standup guy and Clinton as an untrustworthy liar.

Much of this comes from a bias in how we interpret data. When you’ve just bought a red Honda, you notice there are a lot more red Hondas on the road. When you think Hillary Clinton is a liar, you jump on each untruth. We forget McCain — or John Glenn — were part of the Keating Five because we don’t think of them as generally corrupt. Yet an investigation where Hillary Clinton is cleared of wrongdoing becomes a reason she’s not trustworthy.

And part of it is, as Jill Abramson said recently, that Hillary Clinton is a really closed-off person who is distrustful of the media. Like many good lawyers, “her instinct is to withhold.” From refusing to release documents about Whitewater to refusing to release the transcripts of her speeches to investment banks, Clinton’s gut reaction is to see more disclosure as the enemy.

This looks a lot like what I see happen with clients. We take a flaw that’s regrettable but benign and reinterpret it as evidence of corruption.

Every new “pants on fire” rating for Clinton reinforces the idea that she’s a liar — while the same pants on fire statement from another candidate won’t. Every new thing that has to be explained to a prosecutor reinforces the prior belief that the prosecutor is right that your client is shady.

The best response, I think, is a counter-narrative. It’s to replace one organizing principle for the data with another. It can be a delicate client relations issue, but if your client keeps making false statements because he’s an idiot, then you have to explain that he’s an idiot. Merely batting away facts — merely explaining that they aren’t accurate — simply doesn’t shake the perception that’s lodged in someone’s mind.

And, of course, just because something has become embedded in our understanding of someone, doesn’t mean it isn’t true.


Matt Kaiser is a white-collar defense attorney at KaiserDillon. He’s represented stockbrokers, tax preparers, doctors, drug dealers, and political appointees in federal investigations and indicted cases. His twitter handle is @mattkaiser. His email is mkaiser@kaiserdillon.com He’d love to hear from you if you’re inclined to say something nice.