Federal investigations into corporate fraud are plummeting.

And the question is why? Is it because the Corporate Fraud Task Force, created by President George W. Bush's executive order in July 2002, has done a great job stopping fraud? Or is it because the Justice Department has just stopped trying to prosecute it?

Probably the latter, according to Daphne Eviatar in her fascinating piece in The American Lawyer.

The American Lawyer conducted its own investigation into the Justice Department's record on corporate fraud cases. Significantly, the Justice Department refused to help. And the findings are appalling.

The number of cases seem to have peaked in 2003 and then they fell away.

Eviatar writes: "Perhaps the most curious of our findings - and one not highlighted by the Department of Justice - is the precipitous decline in the number of major corporate fraud indictments in the two years since the reelection of President Bush. After issuing detailed reports in 2003 and 2004, the task force stopped reporting on its efforts in 2005, just as corporate fraud indictments slowed to a trickle. Our analysis shows 357 indictments in major corporate fraud cases between 2002 and 2005. But only 14 indictments were identified by the Justice Department as significant corporate fraud cases in 2006. There have been only 12 major corporate fraud cases indicted so far in 2007."

The investigation also found the Justice Department has been hit hard by budget cuts which means fewer investigators out in the field. And beginning in 2005, the Department of Justice significantly scaled back its prosecution of corporate crimes.

The findings are particularly alarming with a recent study by Kroll, reported here, finding that fraud is getting worse.

The question is whether the politicians will create another task force to combat it.