torial burden in the country as a whole is on the States and localities and, secondarily, on the U.S. attorneys; and two, that the system badly needs a headquarters function to do a variety of things. And we define our task as doing those things, as well as the few areas where we assume the major litigating responsibility.

Needless to say, we have, in addition to what I described, assumed a major responsibility with the Office of Special Investigations, the anti-Nazi unit, the one that Ms. Holtzman and Mr. Gudger and others have been so active in. This is now a large time consumer, a large energy consumer, and a function in which we intend to do very, very well.

We are engaging in a number of important and interesting assessments of what the Federal Government is doing. A number of them have been stimulated by this committee. But I think I can rely on the question and answer period as an occasion when I will be bringing those out.

The Criminal Division seems to me to have a fine cadre of lawyers. I am a little bit biased in describing the leadership cadre, because by now I have pretty well assembled it myself; but I think it is outstanding.

The Division is asserting itself in what I hope is not too muscular a way, but a quite vigorous way across the law enforcement world. And with that little bit of self-pumping for the Division, I think I will leave it to you, Mr. Chairman, and the members of the committee and counsel, to ask whatever questions they would like.

Mr. DRINAN. All right. I thank you very much, Mr. Heymann. Did you want to introduce for the record your associates-Mr. Mark M. Richard, the Deputy Assistant Attorney General, and Mr. James W. Muskett, the Director of the Office of Administration-and is Mr. Stephen B. Hitchner here?

Mr. HEYMANN. Yes, he's right behind me.

Mr. DRINAN. I wonder, Mr. Heymann, whether any of your associates would want to add anything.

Mr. RICHARDS. No, sir, not at this time.

Mr. MUSKETT. No, sir.

Mr. DRINAN. All right.

Why don't I yield to the gentleman from Michigan, Mr. Conyers? Mr. CONYERS. Well, first of all I want to welcome Phil Heymann and his associates to the subcommittee. They have been very helpful in working on revisions in the so-called Miller bill to deal with coverup and to make that kind of legislation strong enough. They've been working on aspects of white-collar crime provisions in the criminal code. We have also enjoyed their cooperation in the oil fraud hearings in conjunction with another subcommittee.

We are also very concerned about the formation of the white-collar crime unit, and the fact that OMB has in effect reduced the request for a number of additional lawyers to about 20.

Can you make a comment about the white-collar crime unit and how it operates?

Mr. HEYMANN. I would be happy to, Mr. Conyers.

I am not sure my colleagues can correct me that we ever requested from OMB anything like 100 lawyers. By the end of fiscal year 1981, 18 months from now, we wanted to have 150 attorneys throughout the country committed to economic crime units.

They were to come from two places: somewhere between 90 and perhaps 110 of them were to come from U.S. Attorneys' offices. There they were to be in special units wholly committed to major white-collar crimes and public-integrity cases. The rest, between 40 and 60, were to be on the Criminal Division's payroll, and were to go out in the field to play a rather new role.

The answer to your question-how are we coming on that?-is that we are programed to go up to about 25 by the end of this fiscal year, and that we have 11 or 12 out there now. We can tell you where they are without any trouble if you'd like to know. Next year we would like to take that number from 25 to 45. We've asked for 20 additional slots for that.

The process of recruiting economic crime specialists is a very slow process because an economic crime specialist is a rather rare bird; he or she does not perform an ordinary lawyer's function.

The notion for the economic crime specialist is as follows: In deference to the chairman, why don't we take Boston as an example-I know that Boston is not within your district, Mr. Chairman; but it's close. In the Boston area there are always groups that are doing one thing or another with regard to white-collar crime and making it their business. There is the U.S. attorney. There is the FBI staff office there. There are Customs, Secret Service, and postal inspectors, all of whom play a major role. There are perhaps two or three other Federal investigative agencies. There are State and local agencies. In the Boston area there would be representatives of a number of the 15 program departments that have inspectors general. There are local businesses, chambers of commerce and citizens groups which are the victims of white collar crime.

The U.S. attorney simply does not have the time or the capacity with his ordinary staff to go out and talk to these people, find out what the problems are, what the major issues of white-collar crime are, find out what the investigative agencies are doing. see if they are overlapping, try to set priorities that cover the investigative agencies and the prosecutors so that they are investigating what we want to prosecute a subject that has concerned you in the past, Mr. Conyersand so that we don't decline too many cases after they have been investigated.

The economic crime specialists do all of those things.

Mr. CONYERS. Is there any way we can get a report for myself and the subcommittee in this hearing, a record of the economic crime unit's progress thus far?

Mr. HEYMANN. Yes. What I would like to do is to give you one or two of the reports that have come in after 6 months-one from Portland and one from Philadelphia-where the persons who are the specialists tell us what they have been doing and what they have discovered. (See app. 1 at p. 63.)

Mr. CONYERS. What I need to know, and I am reflecting on the New York Times from last summer, just prior to the Attorney General's appointment, where the sum of an investigation on their part showed there was hardly any Justice Department prosecution of major corporations: and that the Securities and Exchange Commission had referred 420 cases involving overseas bribery involving major U.S. corporations: 10 resulted in guilty pleas and only 30 are under investigation, and the rest have been dropped.

And in the areas of major air pollution and water pollution violations, EPA has referred 130 criminal cases, 6 involving major corporations again; and the Justice Department again has only 1.

So how are we doing with the big multinational violators in these very complex cases for which I thought the economic crimes enforcement unit was geared for?

Mr. HEYMANN. I would be happy to give you an answer, Mr. Conyers. I would like to say something quickly on it right now, though: The major areas where I think you are going to find large corporations engaged in criminal conduct are the areas you mentioned. We don't find an awful lot of fraud by large powerful, successful corporations. You have to be, I think, a rather foolish chairman of the board or president to think that that would be a very sensible path to follow. Foreign corrupt payments is an area you mentioned, it's an area where large corporations are and have been involved. On the basis of our greater criminal experience, we want to accept (and we hope your people will encourage) environmental matters of the sort you have referenced which have traditionally gone to the lands division.

You gave a third category. But those are almost the only categories in which we will find with any regularity major corporations involved in substantial white-collar crime.

We may find campaign violations, things like that.

That tends to point out the importance of the bill that you described at the beginning, and of our reckless endangerment provisions which I know the chairman is going to be pushing vigorously in the full committee.

Mr. CONYERS. You know, one member of the Fortune 500 has admitted engaging in some type of criminal activity-bribery; there is now great pressure to relax the bribery law of 1977. So I would exercise restraint in saying they aren't doing anything wrong.

It looks to me, from my perspective, that many of them are committing a lot more offenses than I had been aware of.

Mr. HEYMANN. I would like to include antitrust. If you put antitrust, foreign bribery and environmental-type offenses or worker-related offenses of the sort that your bill would cover, I think you would be talking about a very large percentage of what we are likely to find.

I didn't mean to say that that was rare for the Fortune 500. I meant to say that those are the categories where you will find cases, or where we are finding cases.

Mr. DRINAN. The time of the gentleman has expired.

I recognize the gentleman from Michigan, Mr. Sawyer.

Mr. SAWYER. On this foreign bribery, of course, we all recognize that there's an inherent problem in the situation. In some foreign countries, unfortunately, they do business that way; it's almost a way of life. And it's a question of whether we are going to let our companies or multinationals overseas be immoral or whether we are going to lose the business, the export busines. So this is a tough question, and I recognize it.

One thing that caught my eye in the budget is the, what seems to me, the inordinate amount of money you are proposing on this antiNazi war criminal situation.

It's the third biggest item in your budget. You've allocated considerably more to it than you have, for example, for public corruption

in this country; more than for fraud and more than for narcotics and drug prosection; in fact, as I said, it's the third biggest item in your budget.

And while I recognize there's some merit to it, that rather smacks of politics to me, as opposed to what the priorities are.

Do you wish to comment on that?

of

Mr. HEYMANN. To me, our Nazi war crimes unit, Mr. Sawyer, the Office of Special Investigations, has a different character than any the others; and it's easy to miss that.

It has the character of a capital expenditure rather than an ongoing program.

The Congress has said—and I think it's a wise decision-that once and for all it would like us to dispose of the problem of Nazi war criminals. It has festered in the United States since the early fifties, often probably mishandled over that period of time by the executive branch; and it has gotten to the place where it has become something of a national scandal.

It isn't a program that will go away next year or the year after: but it isn't a program like public integrity which is something we will have for as long as you and I will be around-and I hope you're around longer than I am. It is a program that is meant to dip into a historic residue of a Second World War problem-a very tragic oneand simply dispense with it once and for all.

Having said that, I think two things: One, I think it is justified and wise. As for the amount of resources, we can't do it with less. But with those resources in a very few years-if not 1 or 2, in 3 or 4-we can lay that period of our history behind us. And I think it's worth doing.

The second thing is the reason that it takes 3 or 4 years instead of 1 or 2. As soon as we got into it we suddenly found that with a few reasonable steps we ought to increase the category of suspects-and we did increase the category of people who are likely, whom we ought to be looking at-by a few hundred.

Mr. SAWYER. Well, except, you know, the next 3 years-we are looking out now to 1981, 1982, so forth-it's an increasing amount; and it gets considerably more in your spending, as I say, than fraud, public corruption, and narcotics enforcement; you know, for whatever the merit, it's kind of a dead horse problem as opposed to something that impacts the life of the people here in the United States at this time.

Now, I'm not saying or suggesting you ought to ignore it, but it just seems to me from a priority point of view, being the third largest item in your budget, extending out over as far as you've made your projection into the future, it just looks to me like it has a political taint to it as opposed to being where the Department's priorities ought to be.

Mr. HEYMANN. There's no quesion that it has strong political support, Mr. Sawyer; but my initial doubts as to whether it was worthwhile have completely disappeared. And I'll tell you what makes them disappear.

It's said in a few words, and that is the cases we end up proceeding with, which may end up being 25 or 30 total, are cases where you're dealing with people who may have killed thousands, may have caused the deaths of sometimes tens of thousands; or personally-I've seen this in terms of our files-walked up to a mother and a child, sep

arated the child from the mother, taken a rifle butt and knocked the 6-year-old daughter's brains out onto the street in front of the mother, and then walked off.

Things like that, when you see them, seem to me to elicit a need for investigation and fair trial and retribution, and I mean retribution even 35 or 40 years later. And I think we ought to go through that trial.

By the end of this year there'll be 200, 300, or 400 folders; and I think we ought to go through them. I think we ought to dispense with the ones that aren't terrible or can't be proved, and I think we ought to act on the others.

And I think we will be pained and you will be pained only a few millions of dollars to do justice with regard to what has been a historic injustice.

Mr. SAWYER. But do you consider this to be prioritized or more important to the American people than devoting your resources to public corruption in the United States, the ABSCAM-type thing, and/or narcotics control?

That's where you have it. And there are ongoing things happening right in this country today, right now, not something that happened in Nazi Germany 35 years ago.

Mr. HEYMANN. Number one, I don't really think the moneys ought to be thought of as competing, Mr. Sawyer. I think Congress established the program. It established a program to deal with the subject of ex-war criminals in the United States. It was initially located outside the Criminal Division and it was then moved into the Criminal Division.

I don't think of it as competing with the public integrity

Mr. SAWYER. They are competing with each other, because we have a limited amount, and from what the administration is suggesting, we'll have an even more limited amount. So you have to prioritize where you are spending the dollars.

And I am just saying that it somewhat amazes me that you have this the third item ahead of corruption or narcotics which are impacting people's lives every day.

Mr. HEYMANN. The numbers are also a little deceptive, depending on where you end up when you straighten them all out.

Mr. SAWYER. They are "deceptive"?

Mr. HEYMANN. Well, they are in this sense: Remember, we are talking about the Criminal Division budget, Mr. Sawyer; we are doing everything in the war criminal category; but when you look at narcotics, which is the best example, 30 percent of the caseload of 2,000 prosecutors, Federal prosecutors, plus massive amounts of State and local prosecutorial dollars and time, go into prosecuting narcotics.

You look at Criminal Division and you look at 25 to 30 attorneys, but when you really look at what's going on in the Federal system with regard to narcotics, it doesn't show up on the figures you have before you. You are talking about hundreds and hundreds of Federal prosecutors; and if you include what the States and locals are doing, you are talking about thousands of prosecutors compared-that would be the realistic comparison-with the 20 attorneys, 17 now, I think, doing the