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The Justice Department has permitted Denny Hastert to plead guilty to a felony money-laundering violation. Under the plea agreement, the 73-year-old former House speaker may face no more than six months’ imprisonment and, quite likely, no jail time at all.

This has some legal experts grumbling. One, according to Politico’s Josh Gerstein, insists Hastert got a “sweet deal.” The critique is worth exploring. In a recent weekend column, I visited “sentencing reform,” Washington’s latest fetish. Hastert’s case is a good example of how badly the bipartisan project misses the mark: failing to address the real problem, which is over-criminalization, not over-incarceration; and encouraging judges to avoid imprisoning offenders by fictional “fact” pleading.

An FBI investigation uncovered that Hastert paid nearly $1 million in “hush money” to conceal “misconduct” that occurred decades ago. The nature of the misconduct is not specified in the indictment and has not been publicly confirmed, so ordinarily I would not describe it. In this case, however, the misconduct is key to understanding why a prominent figure has been induced to plead guilty to a serious charge, and why the “slap on the wrist” Hastert is getting has some people grousing. We thus take note of Mr. Gerstein’s explanation that “sources have alleged the behavior involved sexual contact with a male student while Hastert was a coach and high school teacher several decades ago.”

The money laundering crime to which Hastert pled guilty is called “structuring.” It involves dividing big cash transactions into smaller ones in order to evade financial reporting requirements.

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Under federal law, a bank must file a CTR (currency transaction report) identifying the owner of money involved in any cash exchange exceeding $10,000. Let’s say a person wants to transfer $50,000 in cash without alerting the government. So he breaks what is actually a single bank withdrawal into several withdrawals of less than $10,000 — say, five separate ones of $9,200 apiece. This makes him guilty of structuring because he causes the bank to fail to file a CTR.

Sentences in excess of a decade in prison are not uncommon for this offense because money laundering is considered a serious crime. Why? Because of the misconduct that structuring is commonly designed to conceal.

Most people who come about their money legitimately do not care whether official reports about their transactions are generated. After all, most money exchanges create records of some kind; plus, we all must file income tax returns each year. A CTR thus seems like a marginal additional intrusion into our affairs.

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What kind of people really need to avoid creating records documenting their money movements? Mainly, though not exclusively, we are talking about crooks: high-level narcotics traffickers and mobsters who generate huge amounts of cash proceeds; or tax cheats who want to underreport their income from cash businesses (e.g., vending machines).

Structuring is designed for them. It is not a malum in se offense — a crime like theft, that is inherently wrong and forbidden in every culture. The handling of our own money in everyday activities like bank transactions is essentially innocent behavior — e.g., your decision to make two $7,500 deposits rather than put the whole $15,000 in your bank account at once. Congress has chosen, nevertheless, to prohibit it in order to force professional criminals to create a paper trail that (a) makes the conduct that generates the cash easier to investigate, and (b) makes the criminals easier to prosecute.

As I argued in the aforementioned column, the United States does not have an incarceration problem; the vast majority of the people in prison deserve to be there — Heather Mac Donald compellingly demonstrates this here. But we do have an over-criminalization problem: too much inherently innocent behavior — or at least behavior that, however shady, is not bad enough to be regarded as crime — is regulated by penal laws whose violation can send ordinary, law-abiding people to the slammer.

This happens because Congress and the agencies to which it delegates power write statutes and regulations too broadly, implicating activity far afield from the narrow misconduct they purport to target. Prosecuting offices and regulatory agencies, frequently run by ambitious lawyers who want to make cases, or progressive ideologues who want to dictate how we live, inevitably push these elastic provisions to maximum enforcement.

Structuring is an excellent example of this phenomenon. It is all well and good for lawmakers to target dope dealers, mafia capos, and tax cheats. But in writing the law, Congress did not require prosecutors to prove that the cash proceeds involved in the structured transactions were generated by criminal activity or that the structuring was specifically intended to evade taxation.

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The result? The law ends up applying to people who are not the crooks Congress had in mind — people who have personal reasons for not wanting to create records. Maybe, like many philanthropists, they just want to donate money anonymously to a good cause or a person in need. Or maybe, like Denny Hastert, they have done something embarrassing — maybe even something criminal, albeit not involving the egregious crimes Congress used to rationalize the criminalization of otherwise innocent cash transactions.

Why are commentators upset that Hastert will not be doing heavy jail time? For some it is, of course, that he is a Republican — for them, that alone warrants a stiff sentence. But what bothers fair-minded people is that Hastert may have done something loathsome, exploiting his authority as a teacher and coach to abuse a student sexually.

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Yet, we must bear in mind that Hastert is not being prosecuted for sexual abuse. In fact, he could not be prosecuted for it: even if we assume that the abuse happened, the statute of limitations expired decades ago.

Not only that. There is reason to believe that Hastert’s structuring was discovered because the student, now a middle-aged adult, was blackmailing him, which is a crime. That is, the FBI stumbled on Hastert because he was a crime victim, not a criminal.

Hastert is said to have initially misled the FBI because he did not want to cooperate in the investigation of the blackmailing. Ashamed of what he had done to make himself vulnerable to blackmail, he did not want the former student prosecuted — Hastert wanted to pay him off and make the whole thing go away.

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That is unsavory, sure. But is it unreasonable? Prosecutors drop far more serious cases all the time — rapes, assaults — because the victim chooses not to press charges. If Hastert did not want to pursue the blackmailing, and if the hush money he was structuring was not the proceeds of drug sales or racketeering, why was this private, embarrassing matter any of the government’s business?

It became the government’s business because the money-laundering laws literally apply to transactions that have nothing to do with why we criminalize money laundering in the first place.

So, yes, Hastert’s plea arrangement seems like a “sweet deal,” but not because he got special treatment. If anything, he got unfair treatment: He is a blackmail victim who did not want the FBI’s help and ended up getting prosecuted himself. On the surface, the deal looks sweet because Hastert is getting off scot-free even though money laundering carries draconian penalties. But the reason that he is not getting the draconian penalties is that the government lawyers and the court recognize that he is not the kind of “offender” who should be prosecuted for money laundering.

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In such circumstances, prosecutorial discretion, appropriately exercised, calls for dropping the case. Instead, the government has gone ahead, with the apparent indulgence of the court. To pull this off — i.e., to induce Hastert to plead guilty to a serious structuring offense by sparing him the severe sentence that such an offense calls for — the parties are engaging in “fact” pleading.

This is a euphemism for fraud. Hastert’s 106 separate bank withdrawals to structure $952,000 of the hush-money payoff will somehow be treated as if they do not constitute a “pattern of unlawful activity.” Hastert’s misleading the FBI — i.e., his obstruction of justice — will be ignored as if it did not happen. This airbrushed version of the offense conduct will dodge various sentencing-law enhancements. This will pave the way for the judge to impose little or no jail time, even though an honest reckoning of the facts would have dictated a long prison term.

Of course, you can’t have an honest reckoning when the whole case is premised on the fiction that Hastert is a money launderer.

#share#This brings us to Washington’s latest fad, bipartisan sentencing “reform.”

If you are going to have real reform, it must begin with the real problem: Too much conduct that is either completely innocent or at least not serious enough to warrant the government’s attention has become prosecutable. We should want real criminals in jail — narco-traffickers, gang-bangers, mafia dons, major tax cheats. But we should repeal laws that make criminals out of innocent people. The current sentencing-reform proposals on Capitol Hill fail to address this problem at all.

Instead, they would reduce sentences for actual criminals under the canard that the prisons are overflowing with non-violent drug offenders. But don’t worry, the reformers tell us: No felon will receive his “get out of jail” card unless a judge determines that he merits clemency through a series of careful findings.

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That is fantasy land. Mandatory minimum sentences and strict sentencing guidelines for serious offenses were enacted precisely because judges, often in collusion with prosecutors, were systematically releasing serious offenders, allowing them to continue preying on society. While the “man-mins” and guidelines helped dramatically reduce crime, the left-leaning legal profession agitated against them. One result is “fact” pleading — the sort of shenanigans that we see in the Hastert case: a willfully false rendition of the facts in order to sidestep sentencing enhancements required by law.

That is what sentencing “reform” has in store for us. The proposals may call for careful judicial fact finding before a felon is released. But the law already calls for careful judicial fact finding when the felon is sentenced. What we frequently get, instead, is careful judicial evasion — often aided and abetted, it must be noted, by the Justice Department. It may be that careful fact finding would result in the release of some prisoners who should be released; but the breed of “fact” finding we are apt to get from sentencing “reform” will result in the mass release of incorrigible, violent criminals.

As the money launderers might say, you can take that to the bank.

— Andrew C. McCarthy is a policy fellow at the National Review Institute. His latest book is Faithless Execution: Building the Political Case for Obama’s Impeachment.