Democrats propose rules for Justice Dept. monitors

The Democratic House members said they introduced the bill because new Justice Department guidelines did not address their concerns about the lucrative monitoring contracts and so-called deferred prosecution settlements.

"This legislation completely reforms the selection of federal monitors by creating an open, competitive process," said Rep. Bill Pascrell Jr., D-N.J., a bill sponsor. "It is my hope to end the unmitigated power that federal prosecutors hold to serve as judge, jury and sentencer in the deferred prosecution process."

Justice Department spokesman Peter A. Carr said the department will review the legislation. "However, we believe, among other things, that the legislation is unnecessary, particularly given the principles the department issued in March 2008 that established transparency, uniformity and consistency in the use of monitors for deferred-prosecution and non-prosecution agreements," Carr said.

Lawmakers earlier this year questioned a number of the deals, including one in which the top federal prosecutor in New Jersey awarded a monitoring job to his former boss, former Attorney General John Ashcroft, worth at least $27 million.

A co-sponsor, Rep. Frank Pallone, D-N.J., complained that the prosecutor, U.S. Attorney Christopher J. Christie, was able--without any oversight--to choose Ashcroft and set the terms of the agreement with the company Ashcroft is monitoring, Zimmer Holdings Inc. of Warsaw, Ind.

The response by the Justice Department, Pallone said, was "very minimal."

"Allowing an unelected official unfettered leverage against companies and corporations who have potentially engaged in criminal behavior invites the very type of abuse our judicial system is designed to prevent," Pallone said. "With this legislation, we eliminate no-bid contracts and bring transparency to a process that has been deeply rooted in politics and favoritism for years."

Zimmer Holdings is one of five makers of medical implants that agreed in September to pay $311 million and hire monitors to settle allegations they paid surgeons to use and promote their knee and hip replacements.

Christie has denied any conflict of interest.

Pascrell and Pallone appeared Tuesday with California Congresswoman Linda Sanchez, chairwoman of the House Judiciary Committee's Subcommittee on Commercial and Administrative Law. The legislation also has the backing of Judiciary Chairman John Conyers, D-Mich.

In April, Attorney General Michael Mukasey told a House Appropriations panel that the department has reined in its prosecutors' authority by requiring future agreements to first be approved by the No. 2 official at Justice, the deputy attorney general.

The department over the past 15 years has increased its use of deferred prosecution agreements, many of which involving corporate fraud cases. The deals allow companies to continue operating, but under supervision.