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"I'm sorry your honor. We're breaking the law at such an extent it is impossible for us to be held responsible for it."

The federal government actually makes that argument all the time, and often prevails with it.

What sources do you have to back this claim up?

The DoD is legally mandated to pass an audit but consistently doesn’t: https://thehill.com/policy/defense/4992913-pentagon-fails-7t...