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  1. Jul 2022
    1. What is the "ostrich instruction"? It’s an informal way to refer to an important legal principle, which is that deliberate avoidance of knowledge about one’s own illegal actions should not be a valid defence in law. It’s one of the reasons why, just over 15 years ago, American executives at the energy company Enron were found guilty even though their direct role in malfeasance at Enron wasn’t clear. They should and could have known about fraud, and they were found guilty. Enron has been pointed to as proof that wilful ignorance does not pay. But in my book I stress that that Enron is a fairly isolated case. As a number of other people have pointed out, from journalists Matt Taibbi and Jesse Eisenger to legal scholar Rena Steinzor, US authorities have had an abysmal record of successful prosecution of white-collar crime in recent decades. An American legal scholar based in the UK, Alexander Sarch, is doing important work on this topic. But he is an exception, and I’m a little critical of mainstream legal scholarship in my book. I suggest that legal scholars themselves have been acting ostrich-like about recent shifts in the law. For example, the old adage "ignorance of the law is no excuse" is increasingly waived in US courts when it comes to complex financial and tax crimes. This shift is one of the reasons why I argue that for many powerful and rich people, ignorance really is legal bliss.

      This is a salient point, and a leverage point.