Sunday, March 1, 2009

Noisy Withdrawal

A lawyer suddenly withdraws his appearance and "disaffirms prior oral and written representations."  This is referred to as a "noisy withdrawal."  The setting here, which is important, is an SEC matter - thus triggering Sarbanes-Oxley (SOX).  The experts seem to find that he acted correctly (see here and here). Christine Hurt of Conglomerate Blog provides an in-depth analysis of Rule 205.3 of the Securities Exchange Act (see here). And it should be noted that the "noisy withdrawal" concept was controversial from its inception.  (See letter by 79 law firms here).   

The real issue here is not whether the attorney acted correctly in withdrawing his representation of client Stanford.  Rather, the issue that needs to now be examined, in context, is whether this is a good rule to have.  Is it good to have attorneys withdraw from client representation in these types of situations, and is it good to have them announce it to the world? In the long run will we have better compliance with the law having the attorney withdraw, or will noisy withdrawals result in criminality being kept undercover?  And which way will best protect the public?


Fraud, Investigations, SEC, Securities | Permalink

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You - the premier bloggers of modern day - Professors, experts and such - have become our modern day Info Centers.

As long as "any" protocol exists = where the modern day info center deems it inappropriate to post the scenario at hand

under the rug climbs will be easily found and increase

Posted by: Laser Haas | Mar 2, 2009 12:25:38 PM

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