Donlan Nails Spitzer Saga

In this week's Barron's, the Thomas G. Donlan editorial commentary on Eliot Spitzer (scroll down) is particularly good. On two counts.

First, Donlan gives an accurate portrait the man:

As a prosecutor and as a governor, Spitzer indulged in short-cuts and leaks. Most notably among the short-cuts, he brushed aside the Fourth Amendment's probable-cause standard for gathering evidence. He used an antique state law to gain access to Wall Street firms' e-mails, then sorted through them to find evidence for crimes not previously suspected. Recently, he was fingered for leaking details of an investigation about a political opponent.

And second, Donlan points out the way the case started is truly disturbing:

Federal law requires banks to report transactions greater than $10,000. There need not be any probable cause to think a crime has been committed; it's considered worthy of notice because a lot of crimes involve large sums of cash. People who move cash around in amounts under $10,000 are also presumed to be suspicious, especially if they ask to have their names deleted from the transfers. They might be members of organized crime or drug traffickers or terrorists. As we hear people say all too often, "If they are innocent, what do they have to hide?"

Spitzer moved money around in such a way that his bank's computer filed a routine "suspicious-activity report" with an Internal Revenue Service computer. Connections were made. Information was exchanged. There was a suspicion of a crime: Maybe Spitzer was hiding bribes. Warrants were issued. Wiretaps produced the real evidence of a completely different crime.

This is financial profiling, and it's every bit as dangerous a short cut as racial profiling. It can be justified in extreme cases, but using it to chase a prostitution ring and one of its clients should have been ruled out-of-bounds.

That Spitzer was caught in the same manner he prosecuted (even persecuted) others, has a delicious irony on some level. But it is also troubling in a larger way.