As some of my readers know, I spent time working at the U.S. Environmental Protection Agency all too many years ago, and later as a consultant dealing with environmental regulations, among other matters. One of the most contentious matters then, and still, was the issue of what a human life was worth. If an environmental regulation costs industry [and consumers, because the end user eventually always pays the cost] ten billion dollars, but saves a thousand lives... is it worth it? What if it only saves ten lives?

This issue, whether we like to think about it, is everywhere. Why do we buy life insurance? That's a form of valuing life. Why do we spend precious hours in exercise and physical fitness? It's another way of valuing life by attempting to prolong it in better health.

But there's one area where our laws and our attitudes are far, far behind -- and that's in the area of financial fraud and embezzlement. Just last week, the second largest bank in France announced that a rogue trader employed there had effectively lost over $7 billion by diverting over $50 billion in bank funds to personal speculative trades. This is the largest loss ever created by a single individual, but it's not anything new. The fraud at WorldCom, Global Crossings, and Enron resulted in billions and billions of dollars of losses. The amount of mortgage fraud arising from the latest real estate bubble has yet to be tallied.

And what does this all have to do with the value of lives?

It's simple, actually. Most people work. They invest their lives in working and in trying to save or buy a house or stay at a company long enough for their pension to vest or put aside money for an IRA. When embezzlement and fraud cause them to lose all or part of those investments, in effect, part of their life has been taken. The same thing happens when someone is scammed or phished out of funds on the internet.

In the federal regulatory system, although no one wants to talk about it openly, essentially regulations have established a range of values for human life. Depending on the situation and other factors, at one time that range was effectively from one to twenty million dollars. Doubtless, it's higher now.

Take the current French situation -- seven billion dollars. Seven billion dollars taken from people, admittedly in smaller bits than a whole life, but... if a life is worth twenty million dollars, then the embezzler or fraud artist has committed the equivalent of 350 murders.

Far-fetched, you say? Think about Enron. How many lives were shortened because of health insurance lost? Or because employees lost their retirement? How many investors lost income, either directly or through other pension funds, and what did that do to their lives? How many families' lives were disrupted?

We've tended to treat this kind of white-collar crime as if it were almost victimless, but it's not. It's just that the embezzler and fraud artist take a little bit of life from thousands or millions of people, and we seem to think that it's somehow not nearly so bad as single heinous murder. Yet, I'd be willing to bet that every major fraud/embezzlement case results in actual deaths or at least early deaths among the victims. Most major embezzlers and fraud artists lose what assets they have and serve a few years in jail -- maybe ten at most. Some, like the head of Global Crossings, actually get to keep their ill-gotten gains and serve no time at all.

Maybe, just maybe, if the damages incurred by the victims of embezzlement and fraud were converted into the equivalent of murders... then we might have a bit more deterrence, and possibly certainly more justice.

I don't see this happening... but it should be considered, if not adopted.

—L.E. Modesitt, Jr.:  1/29/2008 12:40:00 PM