Steven and Cornelia Joyce Kinder owned two Kentucky caviar businesses. They would collect paddle fish eggs in the Ohio River and export them. They had all of the appropriate licenses and reported all of their catches in the state of Kentucky.
However, the Ohio River forms the Ohio–Kentucky border. The Kinders would connect one side of their net to land in Kentucky, and the other to land in Ohio. Therefore, some of the caviar was actually harvested from Ohio waters.
Federal investigators charged the Kinders with violating the Lacey Act, which makes it a felony to import flora or fauna in violation of another state or nation’s laws. The Kinders faced up to $250,000 in fines and five years in prison. Because of the possible steep penalties, the Kinders pleaded guilty, and were sentenced to three years’ probation and a $5,000 fine, and they were forced to forfeit their fishing boat and work truck.
While the Kinders did violate Ohio law, and in so doing violated federal law, were criminal charges the appropriate response? There are remedies outside of criminal prosecution that are better suited for these types of mistakes.
Traditionally, criminal penalties were reserved for conduct that was morally reprehensible. In fact, under the common law there were only nine felonies. These common law crimes included behavior that all knew was illegal, such as murder, rape, larceny, and arson.
Today, conduct that was punished civilly through contract or tort law (or not at all) is punished criminally. Business owners run the risk of imprisonment for honest paperwork errors, misunderstanding the law, and even the acts of their employees.
The criminal justice system should be reserved for those who intentionally commit morally reprehensible acts.
For example, the Kinders did not do anything morally wrong. It is not inherently wrong to cast nets in the Ohio River. In fact, they believed they had done what was necessary by reporting their catch in Kentucky.
So why, then, did they plead guilty? Sometimes, it makes economic sense for a business to plead guilty to something it may not have done.
If the government is able to bring felony charges with huge sentences, the accused is forced to make a calculated risk: plead guilty and pay a large fine or go to trial where he will have a large non-recoverable attorney bill and risk going to prison for a number of years. Business owners make an economic decision to plead guilty—often when they feel they did nothing wrong. This process is an easy way for the government to hit up businesses for money.
There is no shortage of true criminals in the world. Investigators’ and prosecutors’ time would be better spent prosecuting those who have committed morally reprehensible crimes. Manufacturing criminals through the regulatory state ensnares the innocent and creates another barrier to economic progress.