When corporate board members are held to a higher standard than public officials

The senior US senator from New Jersey Bob Menendez has so far refused to resign despite being indicted on federal charges of bribery, along with his wife and three businessmen from the state.

The senator allegedly agreed to use his official position to benefit the Egyptian military, and also interfered with a law enforcement probe into these three businessmen. The former chairmen of the foreign relations committee had cash stuffed in envelopes and clothes at his home, with his fingerprints all over them. Prosecutors say he and his wife accepted money, 13 gold bars and a luxury car in exchange for political favor’s.

The senator denies the charges, and says he had a fear of his savings being seized by authorities, which is why all the cash was stuffed in envelopes in his house

Not the first bribery charge for Menendez

But this is not even the first time Bob Menendez has been indicted. In 2015 he faced trial in New Jersey on allegations he had accepted bribes from a Florida eye doctor, but the case ended in a mistrial after jurors were unable to reach a verdict.

The FBI said that as part of the bribery scheme, Menendez provided sensitive, non-public US government information to Egyptian officials, such as the nationality of persons serving at the US embassy in Cairo. The senator faces three charges which together carry a total of 45 years jail time, but he says he’s running for reelection.

Are Supreme Court Justices for sale?

From the floor of the senate to the US Supreme Court. ProPublica, an investigative publication, recently uncovered gifts that were given to Supreme Court Justice Clarence Thomas that were not disclosed. They report that he received luxury vacations, private jet flights and other gifts from wealthy friends, fueling an ethics controversy that is still ongoing. 

They found that this went on for over 30 years. Billionaires gave him destination vacations, private jet flights, helicopter rides, tickets to sporting events in the skybox, resort stays and exclusive golf club invitations.

The gifts given extended to the wider Thomas’ family. His wife Ginny was included in many of these vacations and it appears that business was directed to her consulting firm. Texas billionaire Harlan Crow bought and renovated Thomas’ mother house and helped to pay for Thomas’ great-nephew’s tuition.

Thomas said that he technically was not required to report these gifts. He said he was advised that the trips fell under an exemption and the tuition was a gift to his great-nephew, over whom he has legal custody, rather than to him. 

Senior US officials are becoming cheaper by the scandal

But it seems like the cost of a Supreme Court seat is becoming cheaper by the scandal. ProPublica reported that another justice Samuel Alito took a luxury fishing trip with billionaire Paul Singer without disclosing it. The problem is that Singer’s hedge fund has repeatedly had business before the court. Alito says he didn’t know about Singer’s connection to the cases but also he didn’t feel he had to disclose those fishing trips out in the middle of nowhere where goodness knows what they talked about. Not to mention Justice Alito has been flown around the country on Singer’s private jet. 

Neither Clarence Thomas, Bob Menenedez nor Samuel Alito were without baggage when they were given these lifetime appointments. It’s doubtful either would pass a basic vetting to be a board member. Another justice Sonia Sotomayor’s staff asked public institutions to buy copies of her books when she would speak there. And another justice Neil Gorsuch who reportedly sold real estate to the head of a law firm that had business before the court just two days after he was sworn in as a justice. When an institution has no formal code of conduct, then even senior judges are liable to fall into traps of corruption.

What would happen if these people were on company boards?

But what’s so damaging here is the appearance of impropriety. If Thomas or Menendez were on the board of an international company, this would definitely impact their reputation. The conflicts of interest alone are staggering. Some of these gifts were from people who had political axes to grind and Thomas was hearing political cases that he had to rule on. If a board member was making business decisions based on the value of gifts given to him by suppliers or rivals, either the board member wouldn’t last long, or the business wouldn’t.

A business must have a crystal clear gifts and hospitality policy, along with a risk assessment that underpins the policy, and training for all employees on how the policy works in practice. A solution to track gifts, and ensure proper implementation of the gifts and hospitality policy. Because unlike the Supreme Court, a business isn’t immune to charges of bribery and corruption.