Saturday, July 19, 2008
Linda Friedman Ramirez, Representing Foreign Nationals Blog, White Collar Crime and Criminal Immigration: Prosecution of MacDonald Franchise Results in Plea
Dan Levine, Law.com, Federal Judge Refuses to Accept Guilty Plea in Health Care Fraud Case
Charlie Savage, NYTimes, Felons Seeking Bush Pardon Near a Record (it is an amazing list of individuals - both from the white collar and other areas)
Friday, July 18, 2008
Amir Efrati of the Wall Street Jrl reports on a ruling in the Second Circuit in a post titled, Second Circuit Stings SDNY in “Specialist” Case. The Second Circuit affirmed the acquittal of the trial court, an acquittal that occurred post trial following a jury verdict. Some thoughts on this decision:
What the Second Circuit decision held -
- The court refuses to find that "interpositioning" per se constitutes securities fraud. Interpositioning is when a specialist "'prevents the normal agency trade between matching public orders and instead interposes' himself 'between the matching orders in order to generate profits' for the principal account -- in other words, when the specialist acts as an arbitrage by taking a profit on the spread between the bid price and the ask price of customers' orders." (p. 3-4)
- The court finds that a violation of a "NYSE rule does not establish securities fraud in the civil context... let alone in a criminal prosecution." (p. 18)
- The court finds insufficient evidence of securities fraud here saying that "the government has attributed to [the accused] nothing that deceived the public or affected the price of any stock: no material misrepresentation, no omission, no breach of a duty to disclose, and no creation of a false appearance of fact by any means." (p. 19)
- Some DOJ individuals might be thinking about what kind of language is needed for a new statute so that the conduct they wish to criminalize will be covered.
- What needs to be said by high-ups at DOJ: It's a unanimous decision. How much money should be expended on being told that this isn't securities fraud. Some things just need to be left to control by regulators.
- Those with similar cases on appeal are probably celebrating, and those who plead guilty may be calling lawyers to see if anything can be done to change their plea.
- Don't hold your breath waiting for the US Attorneys Office to issue a press release on this decision as it never seems to happen when they are unsuccessful.
- There's plenty of criminal activity in society today - especially related to Internet fraud and identity theft. Maybe this is how DOJ should be spending its time and energy.
(esp) (w/ a hat tip to Bill Olis)
Thursday, July 17, 2008
A press release of New York Attorney General Andrew M. Cuomo tells of charges against an apartment screening service. The charges arise from an undercover investigation. It is claimed that this "New York City company acting as an apartment broker used bait & switch schemes on the popular website Craigslist.org to bilk 4,000 New Yorkers out of almost $1 million dollars." (see also WSJ here)
Another press release of Cuomo's office "announced the arrests of two former New York State employees who are charged with fraudulently receiving workers' compensation benefits by lying about their employment status."
Victoria Kim, LA Times, Prosecutor Lays Out Case Against Pellicano Client
Tom Hamburger, LA Times, Office of Special Counsel official quits in protest
Chicago Tribune, 2 men accused of defrauding 4 Des Plaines banks (alleged scheme for loans to send cars to Poland)
DOJ Press Release - ICE Probe of Nevada McDonald's Franchisee Results in Guilty Pleas by Local Corporation and Current and Former Executives on Immigration Charges (McDonald's Franchisee Admits to Two Felony Counts – Agrees to Pay $1 Million Fine)
Simon Bowers, Guardian.co.uk, White-collar crime: SFO boss plans to cut back on prosecutions and investigations - (The Serious Fraud Office is taking a different approach from the U.S. to efforts to combat white collar crime. It seems the SFO "plans to spend less money prosecuting and investigating in order to pursue alternative 'harm reduction' initiatives...")
Carrie Johnson, Washington Post, Administration Wanted Loyalist as Justice Department Legal Adviser (Will history paint former Attorney General Ashcroft as a voice of reason? It is hard to imagine that the Attorney General who issued an Order permitting the government to monitor attorney-client conversations in prison would fit this description - see here)
Dan Eggen, Washington Post, White House Blocks Release of FBI Files - Privilege Is Cited in CIA Leak Case (Will Attorney General Mukasay be held in contempt for not complying with a House subpoena?)
John Pacenti, Law.com (subscription required), Defense Team Argues DOJ Ideology Spurred Money Laundering Indictment of Miami Attorney
Background and Prior Discussion of the Ben Kuehne Case:
Addendum - Southern District of Florida Blog here
Wednesday, July 16, 2008
In addition to the Middle District of Florida having a new nominee for U.S. Attorney (see here), Newsday (see also Courant.com) is reporting that President Bush also put forward the name of Michael Considine for Connecticut U.S. Attorney. Mike Considine is chair of Day Pitney's White Collar Defense and Internal Investigations Practice Group.
It is interesting to see two white collar defense attorneys announced as nominees for U.S. Attorney just as the TRAC statistics show that although there is an increase by 7% in white collar prosecutions for April, white collar prosecutions are down 17.7% from five years ago. As previously noted, these statistics raise interesting questions as to what should be included and what has been included in the definition of white collar crime. (see here)
(esp)(w/ disclosure that she is a B.S. graduate of Syracuse U.- home of the Trac Reports).
William March and Elaine Silvestrini, TBO Blog, Sources: Albritton to Get U.S. Attorney Nomination (Brian Albritton of Holland and Knight) This could be a step that will increase the white collar crime prosecutions in the Middle District of Florida, as Albritton's practice was largely devoted to white collar criminal matters.
Tuesday, July 15, 2008
Scott Horton, American Lawyer, Commentary: Has a U.S. Attorney Knowingly Prosecuted Innocent People? (on law.com here) - The article discusses some recent prosecutions in Alabama.
In addition to the issues raised by the article, one can't help but notice that the prosecutor is making no comment. A prosecutor can be placed in an awkward position of not being able to make a comment to explain his or her position of what happened in a case, as the prosecutor is bound by ethics rules. But on the other side of the coin is the fact that prosecutors are not reluctant to issue press releases when they indict an individual, even before the jury has weighed in on guilt or innocence. It is rare that you see a prosecutor issue a press release following a jury trial telling how the jury found the individual or company not guilty. In a system where a prosecutor serves as a minister of justice, one has to wonder if prosecutors should be required - when the defendant wants this to happen - to issue a statement of the "not guilty" finding by a jury in cases where the prosecutor had issued a press release telling of the indictment.
Alan Cowell of the New York Times wrote about the recent indictment in France against Continental Airlines and some employees for charges of involuntary manslaughter related to the Concorde crash in 2000. (See Criminal Charges Against Continental in Deadly Concorde Crash). Continental denies liability. (see here)
Corporations, when prosecuted, typically have charges of obstruction of justice, fraud offenses, or specific offenses like environmental crimes. Although it is becoming more common to see corporations being targets of criminal investigations, it is rare that one sees charges from the homicide category.
In the U.S. there are a few examples of corporations being charged with homicide related offenses. States courts have found that a corporation is a "person" for purposes of criminal liability. This definition opens the door allowing prosecutors to proceed with homicide related charges against a corporation. For example, in a Wisconsin case a court of appeals decision found that a corporation could be prosecuted for negligent homicide. Some may remember an unsuccessful Indiana state prosecution against a major automobile company on charges of reckless homicide for deaths following an explosion of a Pinto. And there are other examples of prosecutors who have brought corporate manslaughter charges.
Other countries may go to greater lengths in recognizing corporate manslaugher. For example, in the UK, there is the Corporate Manslaughter and Corporate Homicide Act 2007. The use of manslaughter types of charges against companies adds an additional concern for companies operating abroad.
Sunday, July 13, 2008
Pittsburgh Tribune, Wecht prosecutor returns to private practice
Mike Stanton, Providence Journal, Urciuoli Retrial Details Emerge - discussing the upcoming retrial of former Roger Williams Medical Center executives following the 1st Circuit's reversal (for background see here)
Amanda Bronsted, National Law Journal & Law.com, Christensen Case a 'Wake-Up' Call for Lawyers on Use of Private Eyes
Ben Evans, Washington Post (AP), Rove Ignores Subpoena, Refuses to Testify on Hill
Editorial, Washington Post, Too Many Prisoners: States Should Stop Warehousing NonViolent Offenders
Joe Whitley has joined the Atlanta law firm of Greenberg Traurig. He previously served in the positions of Acting Associate Attorney General, as the USA in the Middle and Northern Districts of Georgia, and as the first General Counsel of the United States Department of Homeland Security (DHS).
Russell Gold, Wall Street Journal, El Paso Ex-Executives Settle Charges Over Reserves ($235,000 civil fines)
Dan Slater, WSJ Blog, On McNulty Memo, Specter Fires Back at DOJ
(esp) (blogging from Dublin, Ireland)