Federal Prosecutors Continue to Embrace Diversity, Equity, and Inclusion Practices
In the heart of St. Louis, brothers Sidarth Chakraverty and Victor Alston have been making a significant impact, developing housing in blighted neighborhoods. However, their work has recently been thrown into the spotlight due to an indictment on wire-fraud charges.
Hal Goldsmith, a federal prosecutor in St. Louis, brought forth the allegations against the brothers, claiming they inaccurately reported the participation of minority and female subcontractors in the city's Minority Business Enterprise and Women Owned Business Enterprise (M/WBE) program.
The M/WBE program, which offers tax abatements to developers who make good-faith efforts to meet participation goals, has been under scrutiny. The program sets participation targets for racial minorities and women in development projects in exchange for eligibility for tax abatements. However, the program's guidance has been criticised as obscure, arbitrary, and constantly shifting, making it difficult for businesses to comply.
The indictment is not an isolated incident. The Trump administration has been actively working to limit DEI (Diversity, Equity, and Inclusion) programs, bringing corporations and universities to heel for unlawful DEI programs through executive orders and enforcement actions.
The M/WBE program's race- and sex-based preferences have been a contentious issue. The Supreme Court's decision in Students for Fair Admissions v. Harvard suggests that conditioning tax benefits on the use of race- and sex-based preferences is unconstitutional. Similarly, in the recent Supreme Court case Kousisis v. United States, Justice Clarence Thomas underscored that conditioning tax benefits on race- and sex-based preferences could not make it easier for recipients to get the benefits and so cannot be material under federal law.
Interestingly, the M/WBE program stopped counting South Asians as minorities and began setting targets specifically for black subcontractors, a move that has raised eyebrows.
The case reveals the far-flung corners in which the ideology of DEI still finds allies and the severity of punishment that it can inflict. It also highlights the importance of clear and consistent guidance in regulatory programs to avoid confusion and potential misinterpretation.
It's important to note that Thomas Albus, who was initially identified as a person who dropped charges against Sidarth Chakraverty and Victor Alston, does not appear to be involved in the legal decisions regarding these individuals in the available search results. His name appears in unrelated contexts such as fictional characters or actors in series, with no reference to involvement in legal decisions.
The city of St. Louis suspended the M/WBE program due to anti-DEI executive orders and Justice Department guidelines. As the case unfolds, it remains to be seen how the legal proceedings will impact the future of DEI programs and regulatory practices in St. Louis and beyond.
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