Attorney General THORNBURGH. I will be glad to do that, Sena tor. Senator SPECTER. Let me turn to the subject of the war on drugs, Mr. Attorney General, and the very considerable allocations of resources which have come from the Congress and the subject as to how, if at all, we might expedite the use of those resources and those moneys. I compliment your Director of Prisons, Michael Quinlan, on an outstanding job which he is doing. He has been taking a look at the very serious problem of detention facilities, and my request has been to try to have a detention facility in eastern Pennsylvania, hopefully in Philadelphia, like the one which is present in Los Angeles. I was surprised to find even with my familiarity with the District of Columbia, where I served as chairman of the Appropriations Subcommittee, that there are some 300 prisoners in D.C. jails who are Federal detainees, and the long distances which accompany prisoners who come from upstate New York to come down to Philadelphia. And I would ask that you would take a look at the detention issue because there is an urgent need for a detention facility for the region which extends as far south as Washington, Baltimore, and Philadelphia. Attorney General THORNBURGH. It is a serious problem and it is one that we hope to address. There are always siting problems, but I think what Director Quinlan may have told you is that we regard there being a substantial potential in using the Cooperative Agreement Program, which makes Federal funds available to local authorities to build structures and to guarantee us certain access to those, to cut down this travel time which is really becoming an enormous burden on the system. Senator SPECTER. That is a good program, Mr. Attorney General, and I would invite your attention to the limited funding available there. There is only $25 million there, and last year I offered a floor amendment and got into quite a disagreement with Senator Hollings, who chairs the Appropriations Subcommittee. That works in some places. There is an application pending, for example, in Green County, PA, an area which you know intimately. But in the allocation of $1.4 billion which we put up for prisons last year, acceding to the President's very, very good request which you had, I know, endorsed, there is very little money in that specific account. Let me touch another matter which I would like to draw your attention to, and that is on DEA agents. We have put up a considerable sum of money for the Drug Enforcement Agency, and I was surprised, and perhaps you will be, too, to know that Erie, PA, for example, does not have a Drug Enforcement Agency representative in a very tough area with a triangle among Baltimore, Cleveland and Erie. Nor is there a DEA agent in Newcastle, PA, nor is there a DEA agent in either Allentown-they are in Allentown. I was about to say in Wilkes-Barre or Scranton. I know there is some lag time and this may be a problem as to how fast we can utilize the funds and go through the training period. But taking my State-and, of course, that is my principal responsibility, and I am sure it is a nationwide issue-when you have major areas like that, it seems to me, on a priority scale where we do have those funds allocated, there ought to be personnel in those locations. Well, I see my yellow light is up and my colleagues are waiting, so I thank you, Mr. Attorney General. Attorney General THORNBURGH. Thank you. OPENING STATEMENT OF SENATOR METZENBAUM Senator METZENBAUM. Mr. Attorney General, it is nice to see you again. I am concerned, and I have expressed myself publicly, about the fact that some poor guy in a poor neighborhood steals a $510 Social Security check, maybe forges and cashes just a personal check and violates a Federal law, and that individual winds up going to the slammer. White collar criminals are involved in acts that sometimes involve tens of millions of dollars, sometimes hundreds of millions of dollars. And I am aware of the fact that you have increased resources in this area. But, frankly, I believe the Department—and I am not making this personal, but I think it is across the boardhas been lenient and weak when it comes to putting white-collar criminals behind bars. Frankly, I think that the prosecutors pleabargain away too many charges, and huge corporations get off with pathetically small fines. I have spoken on this subject to bar associations and other places, so it is not a new subject with me. My question is, Can't you do more than you are doing to send the word out to your prosecutors and people on your staff that plea bargaining and giving an opportunity to do community service, 200 hours of community service, which is really nothing, is really not the way white-collar criminals should be treated? Frankly, if you put some of them away, then a lot of them won't continue some of the actions in which they have been engaged in the past. That was a lengthy speech and I apologize, but I would like you to address yourself to the subject. Attorney General THORNBURGH. I share your concerns precisely, Senator. I have addressed myself to it in all-too-lengthy speeches from time to time. We do see a much greater receptivity on the part of judges through an educational process, we hope, to impose these kinds of sentences. And my expectation is that with the additional resources that we have available and the increased number of cases that indicate the severity of these white-collar crime cases as they affect important institutions in our society-business, finance and governmentthat more courts will become attuned to imposing the proper kind of sentences. I have made it clear to the U.S. attorneys and to their assistants in personal meetings across the country that this is a very high priority for the President and for the Attorney General, and that these crimes should not be taken lightly and that they should be prosecuted to the full extent of the law. Senator METZENBAUM. And then not plea bargained in the sentence. Attorney General THORNBURGH. Absolutely. Senator METZENBAUM. I would hope you might say not only the President and the Attorney General, but a number of us in Congress really are anxious, because it sends the wrong message to the people of this country. Attorney General THORNBURGH. I agree, and I think that the Congress has contributed substantially in, for example, the increased penalties and the extension of the statute of limitations as part of the savings and loan bill that was passed last year. We not only got the resources, but some clout in terms of increased sentences and the ability to extend these extremely complicated and difficult cases and not lose them to the statute of limitations. Senator METZENBAUM. Along the same line, our corporate penalties are not sufficient to deter white-collar crime. Large international banks like BCCI, a tremendous, tremendous institution, pled guilty to laundering drug money for Noriega and the Medellin cartel, and got fined a mere $15 million. BCCI paid the money and did not miss a single day of business. Multibillion-dollar defense contractors like Northrop plead guilty to falsifying tests on defense weapons systems, and a lot of contractors have been involved in defense contract fraud. They pay $17 million, which is a lot of money to all of us, but not much money to that kind of a corporate operation, and they get to continue their lucrative defense business with the Pentagon. What do you think we can do, in addition? Attorney General THORNBURGH. Well, I think the trend is in the right direction. Both those cases you cite represent the largest fines of their type ever assessed in those kinds of cases, and we continue to try to maximize the financial impact on the businesses, as well as the securing of appropriate jail sentences for any individuals that are involved. In the BCCI case, the $15 million fine forfeiture-it wasn't really a fine; it was a forfeiture-represented the largest forfeiture of its kind in a money laundering case. Money laundering cases are things that are very much in our focus now because of the recognition that it is one of the weak links in the chain of the drug trafficker's empire. With regard to Northrop, that $17 million fine was the largest of its kind in that kind of proceeding. We had a civil recovery of $34 million against a Japanese firm that had engaged in fraudulent customs practices; a $128 million recovery from Sunstrand Corp. with regard to these fraudulent activities. So through a combination of criminal fines and civil recoveries, we are hoping to ratchet up the cost of doing business in an illegal manner on the part of these white collar criminals. They are an absolute high priority of this Department, and we are going to pursue them just as diligently as we can and exact the maximum penalties that we can. Senator METZENBAUM. One other question. When you appeared before this committee-a different subject entirely-for your confirmation hearing less than 2 years ago, I asked for your view on a 7day waiting period prior to the purchase of handguns, and you replied, quote, "We have a waiting period in Pennsylvania, as I told you, Senator, and I think it is an appropriate tool to utilize in giving law enforcement agencies the opportunity to maximize their chances of keeping these weapons out of the hands of individuals who show a propensity toward violent crime," end of quote. When I asked you directly, would you support the concept of a 1-week waiting period, you replied, yes, yes. Now, last November in a report to Congress, you called for research into a system for immediate identification of purchasers at the counter, knowing that it would be years before any such system could ever be in place. At the same time, you reversed your earlier position and rejected the option of a waiting period. Would you share with us why you changed your position-up for confirmation, yes Attorney General THORNBURGH. I don't think I changed my position. That is what I was stating. You had asked about State laws, and I felt that it was appropriate for the States to undertake such a waiting period. The report that we rendered last year has already begun to be implemented in terms of upgrading and improving the criminal justice records at the State and Federal level and in securing additional Federal funding to aid in that process. One of the major shortcomings that was noted in our study of the processes necessary to verify the status of an individual seeking to purchase a firearm at a retail establishment was that there wasn't a sufficiently reliable storehouse of records with regard to convictions. Oftentimes, arrest records are noted without ultimate disposition being noted. Oftentimes, the arrest and disposition records themselves are spotty or inaccurate or overlapping, and I think one of the enormous, positive byproducts of this whole exercise will be to aid the States and local governments, as well as the Federal Government, in creating a storehouse of information that can be used to ensure that persons who have engaged in criminal activities are not given the opportunity to pursue that further. Senator METZENBAUM. In your answer you didn't limit it to States and, frankly, the 22 States that now have waiting periods have found them highly successful, as you know-California, 1,800 picked up; 2,470 convicted felons picked up in Illinois, Maryland, New Jersey, Indiana. I would hope that somehow, Mr. Attorney General, you might reconsider because I think that we could save many police officers' lives, many individuals' lives, if we had a national law. I would be happy to work with you, but I think we need it now and I think we are paying a price by not having it now. My time has expired. The CHAIRMAN. The Senator from Wisconsin, Senator Kohl. OPENING STATEMENT OF SENATOR KOHL Senator KOHL. Good morning, Mr. Attorney General. As a former businessman, I, and I am sure you, believe that our Nation needs vigorous enforcement of the antitrust laws. Unlawful business deals hurt consumers and they weaken the economy. I recognize that you want more money for the Antitrust Division, and I appreciate that commitment. But even with the additional funds, the division will not come close to having the level of resources it had in the late 1970's; in real dollars, that is. The antitrust budget has gone down by more than a third since 1980. Given your limited resources, can you still do an effective job? And let me just read you something from my predecessor, Senator Proxmire, who headed the Banking Committee. Eight months ago Senator Proxmire said, quote, "The Antitrust Division is a shadow of its former self. At a time of unparalleled mergers, its staff has been cut in half. The mighty financial interests are winning," unquote. How would you respond? Attorney General THORNBURGH. I would never take on Senator Proxmire, I think, on rhetoric, but let me state to you that in this year's budget that we have presented to the Congress we have sought a 15-percent increase in the funding for the Antitrust Division based on Assistant Attorney General Rill's appraisal of what the needs are in that operation. We have focused particularly on criminal cases that involve predatory practices, price-fixing, bid-rigging, and the like, and have begun to accelerate our concern in the merger area within the last year, addressing the case involving USAir and the available spaces at the Philadelphia International Airport, the proposed merger of the reservation systems of two airlines, the resolution of a proposed merger and acquisition by Westinghouse and, most recently, the Gillette proposed acquisition. These, I mention not because they are pelts to be hung on the wall, but they are, I think, evidence of the fact that this Department recognizes that there are mergers that can be anticompetitive and anticonsumer, and at the same time recognizes, through the legislation that the President has supported to provide for joint ventures in the production of advanced technology products, that we live in a world where competition is no longer circumscribed by the community or the State, but transcends often international borders. And the adjustments that have been made in our merger policy during the 1980's are designed in large part to take into account the fact that most American companies, even some of the smaller businesses, are dealing in an international market and have to gear up to compete in that market in ways that were not necessary back in the 1940's, the 1930's, or at the turn of the century when the antitrust laws were enacted. So our policy with respect to mergers is one that attempts to balance the obvious interests of the consumer in ensuring competition, lowering of prices and raising of quality through that process, and a recognition that most of these companies must compete not just in the United States where they are subject to the antitrust laws, but with other countries where those antitrust laws either do not apply or are not vigorously enforced. It is a difficult balance to strike, but I am confident that Mr. Rill and Ms. Steiger at the Federal Trade Commission have an approach that strikes that balance, and I expect that the kind of |