What’s in a Plea Agreement?

Does the government know what it’s getting?

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Causey: What’s the deal?

Former Enron chief accounting officer Richard Causey pleaded guilty to securities fraud on Wednesday and agreed to testify against his fellow executives. But it’s not clear what Causey will say as a prosecution witness or whether he’ll implicate Enron’s top dogs, Kenneth Lay and Jeffrey Skilling. How detailed are these plea agreements?

They’re as vague as possible. A cooperation agreement never compels a defendant to state a certain fact under oath. Prosecutors ask their witnesses only to provide “truthful, complete, and accurate information” on a general topic. They might also demand that a witness agree to meet with them whenever they want him to, and that he keep the details of his cooperation a secret. He may have to hand over written documents and promise not to commit other crimes.

In exchange, the government typically agrees to offer him a lesser charge and to request a more lenient sentence on his behalf. Prosecutors may also agree not to use his statements against him. The government’s obligations are—like the defendant’s—left vague: It’s very uncommon for an agreement to include specifics on how much a sentence will be reduced. (The Enron agreements do offer predetermined sentences; in fact, a judge thwarted a plea from Enron CFO Andrew Fastow’s wife because he objected to its guarantee of only five months in prison.)

The government promises to keep up its side of the bargain only if the defendant cooperates. Who decides if the defendant played ball? Prosecutors generally give themselves as much discretion as possible. For example, Fastow’s own plea agreement assigns the government “sole and exclusive judgment” to determine whether he cooperated. (Depending on their agreement, deal-breakers can lose out in different ways: Fastow could be charged on additional counts if he didn’t cooperate; Causey could not, but he would forgo the extra-lenient sentence.)

Prosecutors draw up the cooperation agreement after conducting what’s called a “proffer session” with the defendant and his attorneys. This gives the government a chance to interview its potential witness (sometimes over several days or weeks) and find out what he knows. In general, nothing the defendant says during this period can be used against him, and very few records are kept of what transpires. (Prosecutors may retain the right to use the interview in certain situations—like if the defendant backs out and takes the stand in his own defense.)

Once the defendant spills the beans at the proffer, his lawyers and the government lawyers work out a deal—how much will the government give up for his information or testimony? To complete the agreement, the defendant, his attorneys, and a representative from the prosecutor’s office must sign on.

After a defendant cooperates, the government decides whether to tell the sentencing judge that he provided substantial assistance in their case. If the prosecutors refuse to do so, the defendant can fight them in court—where he must show that the government didn’t act in good faith. The “sole and exclusive judgment” clause in most agreements makes this a difficult case to make, and the government usually wins.

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Explainer thanks Dan Richman of Fordham University and Nancy King of Vanderbilt University.