The Supreme Court ruled 12/10/97 that the Double Jeopardy Clause does not necessarily bar criminal prosecution for the same conduct for which civil sanc tions have already been imposed even where those sanctions could be considered "punishment." In doing so, the Court disavowed its prior decision in United States v. Halper, 490 U.S. 435 (1989), and reaffirmed the previously established rule from United States v. Ward, 448 U.S. 242 (1980).After the government imposed monetary fines and occupational debarment on petitioners for banking violations, it indicted them on criminal charges for essentially the same conduct. Under Halper, the Double Jeopardy Clause would preclude the criminal charges if the civil sanction was so "overwhelmingly disproportionate" to the injury caused that it could not be described as "solely remedial," but must be seen instead as a punishment designed to serve a retributive ore deterrent purpose.
Since all civil penalties have some deterrent effect, the Court held that the Harper test has proved unworkable, for "[i]f sanction must be solely' remedial (i.e., entirely nondeterrent) to avoid implications the Double Jeopardy Clause, then no civil penalties [would be] beyond the scope of the Clause." Rejecting this conclusion, the Court returned to its previously established rule, which required courts to first determine whether the legislature intended to create a civil or criminal penalty. If the legislature intended to create a civil penalty, the Double Jeopardy Clause could be invoked only if the claimant could show by the "clearest proof " that the statutory scheme was so punitive as to "transform what was clearly intended as a civil remedy into a criminal penalty." Applying that rule here, the court held that the statute providing for sanctions for banking violations was clearly intended to be civil, and that there was little evidence, much less clear proof, that the civil sanctions were so punitive as to render them criminal in the face of Congress's contrary intent. Accordingly, the Court held that the Double Jeopardy Clause did not preclude criminal charges for the same conduct.