Saturday, July 9, 2005
To say that cases involving the crime-fraud exception are complicated is certainly an understatement, but a recent decision of the First Circuit in In re Grand Jury Investigation* (here) is one of the more Byzantine. The court's summary of the case, with the usual deletion of identifying information, is as follows:
In the course of a grand jury investigation in [[ ]], a lawyer (Lawyer I) directed his client ("Client A") to commit perjury in testifying before the grand jury, after initially advising him to tell the truth. The same lawyer has also represented another client ("Client B") who might or might not have some connection with the earlier perjury. In [[ ]], Lawyer I told Client A to recant the false testimony. Lawyer I did so after consulting with Lawyer II, who represented [[ ]] other clients (collectively "Group C") variously connected with Client B and with pertinent events.
Learning of the perjury, the government is now investigating the possible involvement of others with that perjury and with other possible crimes. The present grand jury summoned Lawyer I, and the prosecutor sought to question him about the prior perjury of Client A including the involvement of others with that perjury and its subornation. Lawyer I refused to answer a number of these questions, saying that answering them would invade Client B's attorney-client privilege and the joint-defense privilege enjoyed by the Group C clients.
Got that? It takes a while, but the multiple representation and the joint defense privilege are nothing new in wide-ranging grand jury investigations. What makes the case interesting is an order by the district court prohibiting Lawyer I from communicating with Client B or Group C about the government's effort to compel Lawyer I to testify before the grand jury. My surmise is that the government sought the order out of a concern that Client B, and perhaps one or more members of Group C, were in on the perjury by Client A concocted with Lawyer I, and would tailor their testimony to the (perjurious) testimony of Client A to present a consistent story. If Lawyer I were to tell others what Client A said in the grand jury, then other witnesses would be able to work around the perjury and the government's investigation of a possible conspiracy to obstruct justice goes down the tubes.
Client B and Group C challenged the order prohibiting Lawyer I from consulting with his client (Client B) and with the attorney for Group C, with whom he had shared confidential information. The First Circuit upheld the order, holding that while Federal Rule of Criminal Procedure 6(e)(2) only imposes a secrecy duty on the government attorney and grand jurors, not witnesses, a court has the inherent power in special cases to effectively silence a witness:
We now decide that the rule's phrasing can, and should, accommodate rare exceptions premised on inherent judicial power. Absent restriction, courts have inherent power, subject to the Constitution and federal statutes, to impose secrecy orders incident to matters occurring before them. The general power is regularly expressed in orders limiting access to discovery materials, closing sensitive proceedings, and in other contexts. Sometimes these powers are reflected in or reconfirmed by rules, e.g., Fed. R. Civ. P. 26(c), but orders of this kind predated such rules which ordinarily reflect or refine the underlying authority without displacing it.
There is, of course, a simple way to avoid the problem that arose here: don't tell your client to commit perjury before the grand jury (or anywhere else for that matter)! At a minimum, I suspect that Lawyer I's law license is in a bit of jeopardy once the Massachusetts Board of Bar Overseers gets the case, if it hasn't already begun a disciplinary proceeding. (ph)
* Don't they all seem to get that name, or something similar? It's enough to drive you nuts if you ever have to write a brief or article on the subject.
The evidentiary phase of the prosecution of five former executives of the Enron Broadband Services division on securities fraud and conspiracy charges is over after three often excruciating months. The last of the five defendants, Kevin Howard, the CFO of the unit, denied any involvement in a fraud, the same position as the other four defendants, and the government's rebuttal was mercifully short (less than one day). Interestingly, each defendant testified, and by taking a united front the group is likely to rise or fall together. As discussed in posts by Tom Kirkendall on the Houston's Clear Thinkers blog (here), the case did not go as well as the government hoped, with problems ranging from questions about which videotape was actually shown to analysts -- the heart of the government's claim that the defendants made misstatements regarding the unit's prospects -- to questions about the Enron Task Force's tactics in possibly trying to intimidate witnesses. Copying a failed tactic of prosecutors in the Richard Scrushy trial, Tom notes that a prosecutor appeared to violate the judge's order not to discuss a deferred prosecution agreement with a bank that did business with Enron, but the prosecutor did so anyway. The result was the same as in Scrushy's trial: the cross-examination was terminated.
Given the length of the trial and mind-numbing technical details presented in the government's case-in-chief, it will be interesting to see if the jury makes a quick determination based on an overall sense of the credibility of the witnesses without getting too heavily into the minutiae of the case. Houston Chronicle stories (here and here) discuss the defense resting and the government's rebuttal case. (ph)
For those interested in how the Department of Justice's policy on charging business organizations, known as the Thompson Memo, affects the way in which corporations now have to conduct their business, be sure to check out a series of posts by Paul McGreal on the Corporate Compliance Prof blog for an excellent summary of the issues (posts here in Compliance 101). (ph)
Friday, July 8, 2005
Lea Fastow, wife of former Enron CFO Andrew Fastow, completed her one-year term of imprisonment on a tax charge to which she entered a guilty plea related to failing to report income from some of her husband's various outside ventures that did business with Enron. She also has a one-year term of supervised release. She entered the federal detention center in Houston last July, and completed her term in a halfway house, going home a little after midnight. Andrew Fastow will begin serving a ten-year prison term for his role in the Enron accounting debacle after his appearance as the likely star witness in the prosecution of former CEOs Ken Lay and Jeffrey Skilling in the conspiracy trial set to begin next January. A Houston Chronicle story (here) discusses Lea Fastow's release. (ph)
A Financial Times story (here) notes that Rep. Michael Oxley, one-half of the Sarbanes-Oxley duo after whom the corporate and securities reform act is named, asserted that some provisions of the law are "excessive" and the law was passed in a "hot-house atmosphere." That said, Rep. Oxley concludes that there is little chance any of the major provisions will be changed, even those that have burdened small and mid-sized companies: "Congress will not re-visit this issue. The SEC reform [on smaller companies] is not going to happen either." The article also notes the comments earlier this week by Delaware Vice-Chancellor Leo Strine criticizing the Sarbanes-Oxley Act for interfering in state corporate law and Rep. Oxley's response that leaving corporate reform to the states is "rather quaint." Does anyone see a turf battle going on here? The tension between state regulation, which leaves most individual corporate regulatory efforts to private shareholder lawsuits, and the federal approach that relies on the SEC to police larger corporations through the securities laws makes for a fragmented, and often politicized, approach. (ph)
An article in the St. Pete Times (here -- discussed on TalkLeft here) reviews a case in which a homeowner noticed a truck parked outside his home with the faint glow of a computer screen in the cab. After seeing the truck again later that evening, the homeowner called the police, who determined that Benjamin Smith III was using the Wi-Fi network being broadcast from the house to access the internet. A CNN.Com story (here) notes that Smith will have a pre-trial hearing on a charge of unauthorized access to a computer network, a felony in Florida. The Florida statute (Title XLVI, Sec. 815.06(1)) provides:
(1) Whoever willfully, knowingly, and without authorization:(a) Accesses or causes to be accessed any computer, computer system, or computer network; (b) Disrupts or denies or causes the denial of computer system services to an authorized user of such computer system services, which, in whole or part, is owned by, under contract to, or operated for, on behalf of, or in conjunction with another; (c) Destroys, takes, injures, or damages equipment or supplies used or intended to be used in a computer, computer system, or computer network; (d) Destroys, injures, or damages any computer, computer system, or computer network; or (e) Introduces any computer contaminant into any computer, computer system, or computer network -- commits an offense against computer users.
It's an interesting question whether Smith is guilty of a crime when the homeowner's wireless network is not encrypted or otherwise protected, so that any passerby with a laptop equipped with a wireless card could access the person's internet connection. Is a personal internet connection a "computer system" or "computer network"? If it is, then while Smith's access was not specifically "authorized" by the homeowner, is it an "unauthorized" access if one essentially leaves the door open to an internet connection? If Smith hacked into the connection, then it would be an easy case, but that does not appear to be what happened here. Of course, if a person used the network to access personal information of the homeowner, or engaged in transactions in the homeowner's bank account or anything like that by using the internet connection, that would seem to be unauthorized access because the connection is being used for a nefarious purpose even if it were not otherwise protected. But the crime there would be the misuse of the WI-Fi connection and not simply accessing it.
If Smith were merely retrieving or sending e-mail from a web account (I recall a post by Gordon Smith [no relation, I assume] on the Conglomerate blog mentioning his search for a Wi-Fi hot spot in Sweden, I believe) or checking on baseball scores, would his conduct be criminal just because he used an internet connection owned by another person? His use of the internet through the Wi-Fi connection would probably not affect the homeowner's use of the internet, so there would not be any harm in that sense. The Florida statute appears to target misuse of the computer network, much like the federal statute (18 U.S.C. Sec. 1030 punishes unauthorized access that is then misused to obtain information, damages computers, or commit a fraud), and it's not clear that Smith did anything improper while hunched over his laptop in the truck cab. Of course, as the St. Pete Times article notes, the internet companies view free use of a Wi-Fi network as theft, but they're hardly an unbiased party. The crime is not theft of an internet connection, but unauthorized use. Maybe Smith is just really cheap, which is not a crime in most jurisdictions. (ph)
New York Attorney General Eliot Spitzer's office announced a plea agreement with Scott Christian, a broker with Trautman Wasserman & Co., Inc., for executing thousands of after-hours trades for hedge funds in various mutual funds (press release here). Christian entered a guilty plea to violating the Martin Act, New York's broad securities fraud statute. In addition, the SEC filed a civil enforcement suit alleging violations of the federal securities antifraud provisions related to the trading. The SEC Litigation Release (here) states:
Between January 2001 and September 2003, Christian, together with others at Trautman Wasserman, engaged in late trading on behalf of customers. "Late trading" refers to the practice of placing orders to buy, redeem, or exchange mutual fund shares after 4:00 p.m. Eastern Time, the time as of which mutual funds typically calculate their net asset value ("NAV"), but receiving the priced based on the prior NAV already determined as of 4:00 p.m. Late trading enables the trader to profit by basing trades on market events that occur after 4:00 p.m. Christian carried out the late-trading scheme by having customers submit proposed mutual-fund trading orders during the trading day and time-stamping them just before 4:00 p.m. to make it appear that customer orders were received before 4:00 p.m. Christian did not, however, enter these proposed trades for execution. Instead, Christian communicated with customers after 4:00 p.m. and often until 6:30 p.m. or later to determine if the customers wanted to execute the proposed orders or submit different orders based on post-4:00 p.m. market information. After customers made their final post-4:00 p.m. trading decisions, Christian entered orders into the trading system used by Trautman Wasserman.
In another mutual fund late trading case that garnered significant publicity, Spitzer's office will retry former Bank of America broker Theodore Sihpol on four charges on which the jury deadlocked after acquitting him of 29 other counts related to his role in allegedly facilitating after-hours trading by Canary Capital, a hedge fund. A MarketWatch story (here) notes that the jury vote on the four counts (two for falsifying business records and two for fraud) was 11-1 in favor of acquittal, but the N.Y. Attorney General's office is pressing ahead, with the retrial set for Aug. 22. A Wall Street Journal article (here) indicates that Sihpol turned down a plea offer from Spitzer's office. This one sure sounds like a tough case for the prosecutors. (ph)
Thursday, July 7, 2005
Yahoo News (AP) reports here that Rapper Lil' Kim received a sentence of 366 days (year and a day) for "lying to a federal grand jury about a 2001 shootout outside a Manhattan radio station." The district judge sentencing Rapper Lil' Kim was none other than Judge Gerard Lynch, a thoughtful jurist who authored a brilliant piece in the Journal of Criminal Law and Criminology back in 2001 on "Sentencing Eddie."
It is obvious in this case that he thoughtfully weighed important factors in reaching a decision of what would be the appropriate sentence. One of his considerations in rendering the sentence was a comparison to what Martha Stewart received for her alleged lies to the SEC. Interestingly he said that Rapper Lil' Kim "deserved more time because she had lied about a violent crime, not a white-collar scheme." (see here) He also provided a second rationale for why this case warranted more time than that given to Martha Stewart.
The government has continually stressed the need for uniformity in sentencing. What this case demonstrates is that federal judges are capable of providing that uniformity in a thoughtful way and that restrictive guidelines are not always the answer.
the top [a] story today is the jailing the NYTimes reporter Judith Miller. The Wall Street Jrl here points out how the prosecutor on this case Patrick J. Fitzgerald has never provided to the court what crime he is pursuing. If there is no crime, is he entitled to this information? Is it a crime related to the leak (see here), is it perjury, or what is it? Couple this with the reporter's privilege involved, and one does have to ask - where is the necessity of obtaining this information? Perhaps the most bothersome aspect of this result is that Judith Miller did not write this story. (the one who prints the story goes home and the one who doesn't write it goes to jail). The NYTimes Story is here.
This case represents the ultimate conflict of the need of a grand jury to obtain information and the ability of the press to obtain information by providing confidentiality to its sources. But there is a second issue here also - that is who is better equipped to get the best information related to crimes? If not for the anonymity of "deep throat" would criminal activity have come to light? Where was the government then in getting to the bottom of the investigation? Can we be assured that the government will do a better job than the press in providing the real truth to what happened here?
The Wall Street Journal provides a wonderful listing of the biographies of key players related to this investigation. See here.
Wednesday, July 6, 2005
Discussed here and here is the ongoing controversy of whether two reporters (one from Time, Inc. and the other from the NYTimes) will face jail for not testifying on their source of a leak that provided them information allowing them to report the name of a CIA operative. Although Time, Inc. caved in and gave up the reporter's notes, the special prosecutor is not satisfied and wants the two individuals to testify before a grand jury. What happens next remains to be seen (see CNN here). But hats off to the best column seen on this situation, a column here in the Hartford Courant, by Jim Shea, titled, "Can Prisons Survive Reporters?"
The decline of the reporter's privilege is interesting to follow as we see the decline of the attorney-client privilege. (see NACDL report here) Both appear to be suffering at the hands of the executive branch, specifically prosecutors.
UPDATE: Yes and No
In answer to the question posed above, New York Times reporter Judith Miller will go to jail for civil contempt, but Time reporter Matthew Cooper will testify before the grand jury. Cooper stated that his source had released him from their confidentiality agreement. An AP story (here) and Wall Street Journal story (here) report that Miller may have received a similar release from her source (who may be the same person as the source for Cooper's articles), but she stated that such a release was "coerced" and so she will continue to protect the person's identity.
For those who are interested, special counsel Patrick Fitzgerald's brief seeking the imposition of a civil contempt on both reporters if they continued to refuse to testify is below. (ph)
Addendum - It looks like Time reporter Matthew Cooper has been spared jail. According to the Wall Street Journal here, the reporter's source has given the OK for Cooper to talk. But not Judith Miller of the NYTimes. Not everyone has her in their fan club. Check out this story that references Martha Stewart. here (esp)
Edward Reich, former president of the Brooklyn Bar Association and a member of its Judiciary Committee for 27 years, was sentenced to a 27-month term of imprisonment and fined $75,000 for accepting bribes to lower the sale price on three foreclosure sales that he was appointed by the court to oversee. Reich entered a guilty plea to one conspiracy count after being indicted on 16 counts, and as part of the plea agreement he surrendered his law license and will pay $10,500 in restitution. The Sentencing Guidelines for the offense provided a 33-41 month range, and U.S. District Judge John Gleeson departed downward a bit in imposing the sentence. The court received approximately 20 letters of support, including one from the Chief Bankruptcy Judge in the Eastern District of New York, asserting that Reich's actions were aberrational. Judge Gleeson still imposed a fairly significant sentence on a 68-year old former leader of the bar with no prior record. Of course, Reich didn't help his case by asserting to the judge that no one was harmed by his conduct and admitting that an affidavit he filed to suppress statements made to FBI agents was false in its assertion that he did not know that he could refuse to speak with the agents.
Like so many other stories of this type, Reich ended his career over a trivial amount of money. Would you sell your law license for $10,500? A New York Law Journal story (available on Law.Com here) discusses the prosecution and sentencing. (ph)
An AP story (here) states that the SEC plans to file papers in connection with a hearing on July 7 before U.S. District Judge Inge Johnson that it wants to move forward with the civil fraud case against former (and future?) HealthSouth CEO Richard Scrushy. The Commission filed its case back in March 2003 (complaint here) alleging violations of the antifraud, reporting, and books-and-records provisions of the federal securities laws and related rules, including allegations that Scrushy aided and abetted violations by HealthSouth's various CFOs. The SEC seeks a permanent injunction, civil penalties, and a director-and-officer bar against Scrushy. The story quotes one of Scrushy's attorneys stating, ""We'll challenge everything . . . Mr. Scrushy doesn't believe he's done anything [wrong]." It sure sounds like this one will be Round Two of the Battle of Birmingham because the SEC is unlikely to back down from the challenge of a CEO whose company had every CFO in its history plead guilty to conspiracy to commit securities fraud and related charges. (ph)
The SEC filed a civil injunctive action in Texas alleging that Stanley Leitner and Bradley Stark, the latter a convicted felon on supervised release at the time, engaged in a fraudulent scheme that raised $13.8 million from Christian ministries by promising that some of the returns on the investments would be used for charitable purposes. The SEC complaint (here) alleges that the defendants touted Megafund Corp., a Texas company, as an investment vehicle to pool funds for "risk free" investments, and that $11 million was transferred from Megafund to an account with a bank in the Netherlands Antilles -- better known as a black hole in the world of off-shore banking; the SEC also alleges that the defendants used money for personal expenses. Seventy investors were enticed with claims that an unnamed "Trader" at a "major U.S. Brokerage firm" would make the investments that would return 10% a month, or over 120% a year. Once again, if it sounds too good to be true . . . . (ph)
As the lazy days of summer are upon us, with our nation's Capitol abuzz with talk of the Chief Justice joining Justice O'Connor in the resignation parade, it's sometimes nice to remember a more gentle time, when the White House was leaking information to the New Yorker about Linda Tripp's failure to include a prior conviction on her security clearance form once it came out that she was cooperating in the Independent Counsel's investigation. If you want to relive those days, check out this opinion from the D.C. Circuit (yet another In re: Madison Guaranty Savings & Loan here) rejecting the claim of a Department of Defense employee who worked in the same office as Tripp (and Monica Lewinsky, for a short time) seeking reimbursement for attorney's fees of $6,093.75 related to his grand jury testimony . . . for the good ol' days. (ph)
Tuesday, July 5, 2005
Surprisingly, Time, Inc. has decided to forego the reporter's privilege and provide its notes to a special prosecutor, notes that may provide information concerning an investigation into a leak of the name of a CIA agent. This position is contrasted with the New York Times that has decided to remain silent and risk a possible contempt and jail order.
Background and commentary on this controversy can be found in this post. The New York Times discusses today the increased threat to journalists of government subpoenas.(here) MSNBC (AP) notes here that "[s]pecial counsel Patrick Fitzgerald, the U.S. attorney in Chicago, has been investigating who in the Bush administration" leaked this information. The matter proceeded through the courts, and a rehearing en banc was denied here. The consequences of such a leak, if the individual(s) is/are who committed this act are found, could involve the following criminal statute:
50 U.S.C. § 421. Protection of identities of certain United States undercover intelligence officers, agents, informants, and sources.
(a) Disclosure of information by persons having or having had access to classified information that identifies covert agent
Whoever, having or having had authorized access to classified information that identifies a covert agent, intentionally discloses any information identifying such covert agent to any individual not authorized to receive classified information, knowing that the information disclosed so identifies such covert agent and that the United States is taking affirmative measures to conceal such covert agent's intelligence relationship to the United States, shall be fined under Title 18 or imprisoned not more than ten years, or both.
(b) Disclosure of information by persons who learn identity of covert agents as result of having access to classified information
Whoever, as a result of having authorized access to classified information, learns the identity of a covert agent and intentionally discloses any information identifying such covert agent to any individual not authorized to receive classified information, knowing that the information disclosed so identifies such covert agent and that the United States is taking affirmative measures to conceal such covert agent's intelligence relationship to the United States, shall be fined under Title 18 or imprisoned not more than five years, or both.
(c) Disclosure of information by persons in course of pattern of activities intended to identify and expose covert agents
Whoever, in the course of a pattern of activities intended to identify and expose covert agents and with reason to believe that such activities would impair or impede the foreign intelligence activities of the United States, discloses any information that identifies an individual as a covert agent to any individual not authorized to receive classified information, knowing that the information disclosed so identifies such individual and that the United States is taking affirmative measures to conceal such individual's classified intelligence relationship to the United States, shall be fined under Title 18 or imprisoned not more than three years, or both.
(d) Imposition of consecutive sentences
A term of imprisonment imposed under this section shall be consecutive to any other sentence of imprisonment.
UPDATE (7/5): An AP story (here) states that special counsel Patrick Fitzgerald has requested that the court order Matthew Cooper to testify before the grand jury even though his notes have been turned over by Time. Fitzpatrick also opposes the requests of Cooper and Judith Miller that they be permitted to serve the likely civil contempt by home detention. (ph)
Daniel Bayly, a former Merrill Lynch executive convicted in the Enron Nigerian Barge trial and sentenced to a thirty-month term of imprisonment, has been ordered by U.S. District Judge Ewing Werlein to report to prison on July 14. Bayly's request for bail pending appeal was turned down by the Fifth Circuit (see earlier post here), and will serve his term in Petersburg FCI near Richmond, VA. A second defendant, James Brown (also formerly with Merrill Lynch), will begin his 46-month term in August. The other three defendants convicted last year, former Merrill Lynch executives Robert Furst and William Fuhs and former Enron executive Dan Boyle, have not had a date set for reporting to serve their terms. A Houstron Chronicle story (here) discusses the Judge's orders. (ph)
Monday, July 4, 2005
Jules Fleder of Beverly Hills, CA, was indicted for being the mastermind behind an investment scheme that allegedly bilked investors in the Tyler, Texas, area of almost $6 million for supposed real estate developments in Texas, Virginia, and South Carolina. The SEC also sued Fleder and three other defendants for securities fraud (Litigation Release here), and Fleder agreed that the SEC could sell his assets, including a $3 million house in Beverly Hills that he shared with his wife, Kayatana Harrison. Although Harrison initially agreed to cooperate in the house sale, she has been a bit resistant since, and was held in civil contempt for failing to cooperate with the real estate agent. U.S. District Judge Michael Schneider also threatened to hold her in criminal contempt when she fled the hearing and tried to hail a taxi before her attorney persuaded her to return. According to a real estate agent, the house has been fouled by some "gifts" from a dog living there, and a hole in the roof has given it a musty smell; the agent also stated that Harrison has removed fliers advertising the house and told potential purchasers that it sits on an earthquake fault line and could slip off the hill on which it sits -- of course, that covers a substantial amount of Southern California real estate.
The judge has ordered Harrison to vacate the house within two weeks and provide an inventory of goods she plans to take. Given the overheated Los Angeles real estate market, this may be one of the few bargains available in the area. A story in the Tyler Morning Telegraph (here) discusses the contempt and prosecution of Fleder. (ph)
Frank Philips, a former Microsoft employee, was convicted on Friday, July 1, of ten counts of wire fraud and one count of using a false social security number related to a scheme to steal software from the company and then sell it on eBay. Philips made over $100,000 from his scheme. This wasn't Philips' first brush with the law, however, a fact that Microsoft apparently missed when it hired him. According to a press release (here) issued by the U.S. Attorney's Office for the Western District of Washington (Seattle): "PHILIPS was hired at Microsoft in 2000 using a false social security number. PHILIPS had been sentenced in December of 1999 for Social Security Fraud for submitting to the FAA an application for an Airman Certificate, in which, in order to conceal his identity - i.e., the prior revocation of his Airman Certificate - Philips listed a false social security number. PHILIPS used a different false Social Security number with Microsoft and claimed he had never been convicted of a felony." What a shock that he didn't disclose that pesky little felony conviction, and perhaps a little bit more thorough background check might have brought the problem to light before Microsoft took the hit. (ph)
Sunday, July 3, 2005
Without doubt, Justice O'Connor's upcoming departure from the high court will be significant to areas related to social issues in society. And depending on the replacement selected, it may change the course of the Court's jurisprudence in many areas, as she often served as a swing vote. But will this departure be significant to white collar jurisprudence? Most likely not, unless of course her replacement can sway others in new directions. The two white collar areas where her influence may be consequential are sentencing cases and international white collar cases.
The following is a review, although by no means an exhaustive list, of her vote in some of the key white collar cases. Omitted are cases where individual justices did not play a major role (although they all were of significance) because of the unanimous or near unanimous decisions (Hubbell, Anderson, etc.).
1. Ratzlaf - Justice O'Connor was part of the 4-person dissent in a case that gave a heightened meaning to the word "willfully" in a complicated money laundering statute.
2. McCormick -Justice O'Connor was part of the dissent in a Hobbs Act case that required a quid pro quo for a conviction under this statute. She concurred in the followup Evans case that held that "an affirmative act of inducement by a public official" is not required under the Hobbs Act.
3. McNally - Justice O'Connor dissented in this famed case that required "money or property" for a mail fraud conviction (pre- the 1346 amendment).
4.Neder - Justice O'Connor was part of the Rehnquist majority in holding that "materiality of falsehood is an element of the federal mail fraud, wire fraud, and bank fraud statutes." (but there were only 3 dissenting on this case).
5. Schmuck - Justice O'Connor was part of a 4-person dissent that stressed the importance of a mailing being in furtherance of the fraudulent act.
6. Reves - Justice O'Connor was part of a 7 person majority that created the famed "operation or management" test for a RICO count brought under sec, 1962(c).
7. R .Enterprises - Justice O'Connor authored the majority opinion in a case that decided "what standards apply when a party seeks to avoid compliance with a subpoena duces tecum issued in connection with a grand jury investigation." But the majority was strong here, with 2 concurrences.
8. Williams - Justice O'Connor was part of a 4-person dissent that dissented in part to a decision that failed to dismiss an indictment when the government failed to present "substantial exculpatory evidence" to the grand jury.
9. Sentencing Decisions - Professor Doug Berman's sentencing blog states that "Justice O'Connor served as a key fifth vote in the 5-4 decisions that produced the Almendarez-Torres "prior conviction exception" and the Harris "mandatory minimum" exception to the Apprendi-Blakely rule." (See here). So her role in some sentencing decisions was consequential to the direction taken by the Court. How this will play out in the white collar area is less known.
10. Pasquantino - Justice O'Connor was part of a 5 person majority here, so her role in the future of cases that may have international implications is significant. She voted here that a wire fraud case could include as its property the tax revenues of another country. But she also held in the Small case ( 5-3 decision-Rehnquist did not participate) that "convicted in any court" means domestic courts and not foreign courts. Since extraterritoriality was left open by the majority opinion in the Pasquantino case, (see here), but directly confronted in the Small decision, a non-white collar case, the future of extraterritoriality in white collar cases remains uncertain. It is here, that the departure of Justice O'Connor could be of enormous importance for future white collar crime cases.
Fraud investigations and charges are not unique to the U.S. Looking at the Times U.K. of today we see a headline titled, "Baugur Fraud Charge Rocks Somerfield Bid." Baugur, an Icelandic company, states that its " main policy is to focus on investments in the retail, service and real estate sectors, in Iceland and northern Europe." According to the UK Times, here, Baugur "is also a main player in a consortium preparing to bid for the UK’s fifth largest supermarket group." The article states that "Jon Asgeir Johannesson, head of Icelandic investor Baugur, was charged with fraud." The article also states that "[m]ore than 40 separate charges have been brought against Johannesson, members of his family and other Baugur executives after a long-running investigation by the authorities in Iceland."
Earlier this week, the UK Times had a front page story on a fraud investigation into the "sick miners fund." The article by Andrew Norfolk stated that " [f]raud squad detectives are opening a criminal inquiry into a miners' union that has earned millions of pounds from the world's largest personal injury compensation scheme, The Times has learnt." See more here (punch in fraud investigation).
Several things to point out here -
1."fraud squad detectives" - in the US, the FBI has individuals who work on fraud cases, but would a separate division nationally that went to individual places to work on these cases be something useful? Not sure.
2. Sentences - why did people I spoke with at the International Society for the Reform of Criminal Law (ISRCL) look at me like I was from another planet when I told of the high sentences the U.S. was giving on some recent white collar cases? Have we forgotten the basics of punishment theory?