Regulatory Monitors: Policing Firms in the Compliance Era
76 Pages Posted: 10 May 2018 Last revised: 20 Mar 2019
Date Written: August 3, 2018
Like police officers patrolling the streets for crime, the front lines for most large business regulators—Environmental Protection Agency engi¬neers, Consumer Financial Protection Bureau examiners, and Nuclear Regulatory Commission inspectors, among others—decide when and how to enforce the law. These regulatory monitors guard against toxic air, financial ruin, and deadly explosions. Yet whereas scholars devote considerable attention to police officers in criminal law enforce-ment, they have paid limited attention to the structural role of regu¬latory monitors in civil law enforcement. This Article is the first to chronicle the statutory rise of regulatory monitors and to situate them empir¬ically at the core of modern administrative power. Since the Civil War, often in response to crises, the largest federal regulators have steadily accrued authority to collect documents remotely and enter pri¬vate spaces without any suspicion of wrongdoing. Those exercising this monitoring authority within agencies administer the law at least as much as the groups that are the focus of legal scholarship: enforcement lawyers, administrative law judges, and rule writers. Regulatory moni¬tors wield sanctions, influence rulemaking, and create quasi-common law. Moreover, they offer a better fit than lawyers for the modern era of “collaborative governance” and corporate compliance departments because their principal function—information collection—is less adver¬sarial. Yet unlike litigation and rulemaking, monitoring-based deci¬sions are largely unobservable by the public, often unreviewable by courts, and explicitly excluded by the Administrative Procedure Act. The regulatory-monitor function can thus be more easily ramped up or deconstructed by the President, interest groups, and agency directors. A better understanding of regulatory monitors—and their relationship with regulatory lawyers—is vital to designing democratic accountability not only during times of political transition but as long as they remain a central pillar of the administrative state.
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