Amid a flurry of pardons President Donald Trump issued to white-collar criminals last week, one name that has largely escaped notice did not belong to a person at all.
In what may have been a first, Trump pardoned a corporation. The company to earn that distinction was a cryptocurrency exchange sentenced to a $100 million fine for violating an anti-money laundering law.
“As far as I know, the president has never granted a full pardon to a corporation.”
The move surprised scholars of presidential pardons, which have traditionally been considered the domain of human beings. Several experts contacted by The Intercept said Trump appears to have acted within his powers, but they were unaware of any prior instances of corporations granted full pardons.
“There have been plenty of cases where presidents have remitted fines or forfeitures or something else like that,” said Margaret Love, who served as U.S. pardon attorney from 1990 to 1997. “As far as I know, the president has never granted a full pardon to a corporation.”
One longtime critic of the federal government’s lenient approach to corporate crime said Trump’s pardon sent a dangerous message.
“Putting corporate pardons on the table strengthens Trump’s corrupt and authoritarian power over corporations,” said Rick Claypool, research director for consumer advocacy group Public Citizen’s president’s office. “This has the potential to trigger a lobbying frenzy for any corporation that has faced federal enforcement.”
BitMEX’s Big Break
Trump’s pardon of HDR Global Trading, the owner and operator of crypto exchange BitMEX, was issued at the same time as pardons for three of the company’s co-founders and one of its employees.
Just like people, corporations can be convicted of crimes. While they cannot be sentenced to prison, they can face fines and serious consequences such as being barred from federal contracts.
The company and the four employees, including influential Bitcoin booster Arthur Hayes, pleaded guilty to violating the Bank Secrecy Act, which requires businesses to take steps to prevent money laundering.
Prosecutors said the company pretended to pull out of the U.S. market to avoid complying with the law, but knew its withdrawal was nothing more than a “sham,” even seeking out U.S.-based influencers to market its platform.
HDR Global Trading is incorporated in the Seychelles, an Indian Ocean island nation that has been dubbed a tax haven by the Tax Justice Network.
The company pleaded guilty last July. Two months ago, a federal judge handed it a $100 million fine and two years’ probation. The fine was supposed to be paid within 60 days of the judgment’s entry into the court record. The timing of Trump’s pardon means the company may have avoided that deadline by hours.
The White House, the U.S Attorney’s Office for the Southern District of New York, and the company did not immediately comment on whether the fine was paid.
BitMEX says it still bars U.S. citizens from using its services. In a statement, the company thanked Trump.
“The BitMEX platform will continue to lead the market as the safest, most trusted, financially-stable, and professionally operated crypto derivatives exchange, employing new products and innovations month by month to many satisfied users,” the company said.
If the company did pay the judgment, legal scholars said, there would be no refund.
Under 1877 Supreme Court precedent, the president’s pardon power “cannot touch moneys in the treasury of the United States, except expressly authorized by act of Congress.”
BitMEX was not the only company to catch a break. Separately, Trump on Friday commuted the probation of Ozy Media, an online outlet that collapsed under allegations of fraud by its founder Carlos Watson two years ago. Ozy was also released from having to pay fines or restitution.
Trump’s Right
Scholars of presidential pardons said Trump was within his rights.
“It’s absolutely clear to me that a president can pardon corporations. The power to pardon plainly extends to any entity capable of being convicted of a crime,” said Frank Bowman, a University of Missouri law professor.
Yet while they said presidents have relieved companies from fines and other consequences of conviction as long ago as the 19th century, they struggled to think of any prior pardons.
The first known corporate request for a pardon was in 1975, according to a report from the time. President Gerald Ford’s White House rejected the request.
Ford’s predecessor, Richard Nixon, commuted the sentence of another company, according to Sam Morison, a former staff lawyer in the Justice Department Office of Pardon Attorney who conducted a review of its archives.
To Stanford University law school professor Bernadette Meyler, Trump’s pardon last week evoked the Supreme Court’s ruling in Citizens United.
“While we have seen the rise of a trend of treating corporations as persons in other areas of law, we haven’t seen that so far in the area of pardoning,” she said.
Worrying Precedent?
While Trump appears to have been within his rights, several observers said they were worried about the pardon’s implications.
Claypool, of Public Citizen, pointed to the crypto industry’s cozy relationship with the Trump administration. The Trump administration has already halted or dropped 14 cases targeting crypto companies, Claypool said. The pardon last week sent another message to the corporate world, he said.
“If you’re a corporation in a favored industry, you can break the law. You can get caught. You can be prosecuted and sentenced with a $100 million fine, and it doesn’t matter,” he said.
Brandon Garrett, a Duke University law professor who has written a book about how companies win backroom deals with prosecutors, said the pardon was part of a larger retreat from the enforcement of corporate crimes under Trump, pointing to his order freezing enforcement of the Foreign Corrupt Practices Act.
“This may just be of a piece with the large and small ways in which corporate accountability is just not a focus. Quite the opposite,” he said.
Bowman said he was not alarmed by a corporation being pardoned — but by the larger pattern.
“Trump now seems to be systematically pardoning corporate malefactors left and right without respect, really, to any real serious consideration about the merits of the cases, the larger policy implications of issuing these pardons,” he said.
Morison, who now represents clients seeking clemency, predicted a surge in business.
He noted that one company that would not benefit from Trump’s novel exercise of the pardon power was the Trump Organization, since it was convicted of tax fraud and business records crimes on the state level.
“Trump can’t pardon his own company. Otherwise, he would,” Morison said.
(Except for the headline, this story has not been edited by PostX News and is published from a syndicated feed.)
