White Collar Crime Prof Blog

DiMasi Indictment

The U.S. Attorneys Office in Massachusetts indicted the former Massachusetts Speaker of the House, Salvatore F. Dimasi, along with three associates on charges of conspiracy, mail and wire fraud (using the honest services statute), and money laundering.  Dimasi served as speaker of the house from October 2004 through January 2009. The Indictment makes a point of noting that he is a lawyer. The case is alleged to involve a software company that sells "business intelligence and performance management software and related services."  The press release sums it up as a "scheme to deprive the citizens of Massachusetts of his honest services by allegedly improperly using his power and influence to enable a software company to obtain multi-million dollar procurements from agencies of the Commonwealth of Massachusetts." Like so many modern cases, emails may be playing a part in the case as one finds reference to emails in the Indictment.

Indictment - Download DiMasi Indictment

In the News & Around the Blogosphere

Jennifer Buske & Josh White, Washington Post, Insiders Linked to Pr. William Fraud Case -4 Accused of Bilking County of Millions By Rigging Bids

Soon-to-be-Justice Sotomayor - Connecticut Law Tribune, 2nd Circuit Judge Calabresi on Former Student and Current Colleague Sotomayor; Joe Stephens and Del Quentin Wilber, Gritty First Job Shaped Nominee

Mark Hamblett, NYLJrl, law.com, N.Y. City Attorney Arrested for Mortgage Fraud, Forgery

DOJ Press Release, Northwest Indiana Businessman Who Used Sham Trusts Pleads Guilty to Tax Fraud on Eve of Trial

DOJ Press Release, Former Michigan School Superintendent Indicted in Bribery Conspiracy

Kate Gibson, WSJ, FBI Director Anticipates New Crime Wave Of Financial Fraud

Grant McCool & Martha Graybow,FBI targets fraud in TARP, stimulus fund

Boston Globe, Scandal Raises Issues for Patrick  (More on DiMasi case forthcoming)

Hank Grezlak & Leo Strupczewski, Legal Intelligencer, law.com, Pa. Judicial Corruption Probe Said to Be Eyeing Criminal Cases

(esp)

Wecht Case Over

There is no press release on the website of the US Attorney for the Western District of Pennsylvania announcing the dismissal of the case against Cyril Wecht.  But one seldom finds a US Attorney's Office posting a press release on a case dismissal - it always seems to be the indictments and convictions that they are anxious to report. (shouldn't a minister of justice report all instances of justice?).  

But the press is reporting that the charges against Cyril Wecht have been dropped. See Paula Reed Ward, Pittsburgh Post-Gazette, Wecht charges dropped; Eric Heyl, TribLive, Buchanan's big case slams shut for good; Joe Mandak, Philly.com (AP),U.S. drops charges against pathologist

This, too, isn't surprising as key evidence was tossed from this case last month. (see here) This case started with many counts against Cyril H. Wecht (see Indictment). The initial trial that lasted 7 weeks with the  government presenting 44 witnesses.  It resulted in a hung jury. 

On my wish list this past year to President Barak Obama was that his administration

• Conduct an investigation on cases such as former Alabama Governor Siegelman and Cyril Wecht and if politics played any role - do the right thing

A dismissal renders this issue moot, and that's OK. Everyone needs to move on.

(esp)

Perp Walks & the Press

New York Law Journal (law.com) has a superb article by Vesselin Mitev titled, Court Refuses to Halt Media's Use of 'Perp Walk' Photo.  Clearly a court cannot and should not interfere with the right of the press to report the news as they see fit. The fact that jurors may be subjected to photos that may taint their opinion of the accused is left to defense counsel to ask about in voir dire and to exclude those individuals that may have been improperly influenced.  And if the government goes too far with their tainting the pool, a change of venue or dismissal may be necessitated.  The problem in this regard is the government and not the press use of the material.

But that said, the government practice of perp walks is appalling and all press should seriously consider whether they want to participate in furthering this government (mis)conduct.  Perp walks are designed to get the media to buy into press of an accused individual being brought into custody via handcuffs.  In white collar matters, the individual would have likely turned themselves in without the need for a handcuffed parade in front of the press and oftentimes fellow workers. The practice is one that is in opposition to our system that affords accused individuals a presumption of innocence until proved guilty by the government.  Although the press cannot, and should not, be prohibited from using these photos, one would hope that they would evaluate their own ethics in buying into this government practice.  And if the government continues to proceed with perp walks, then the courts need to evaluate whether the government has deliberately tainted the jury pool, and the ethics of this practice.

(esp)

In the News & Around the Blogosphere

Mark Hamblett, NYLJ, law.com, Lawyer Admits Dipping Into Escrow Funds for $9.3 Million; David Glover, Bloomberg, Lawyer Cauley Pleads Guilty to Stealing $9.3 Million

Don Thompson, Mercury News.com, Ex-Calif. Senate leader cleared in kickback probe

(esp)

 

UK Looking at Lawyers

The US may not be the only government entity proceeding against lawyers, as the UK Financial Services Authority seems to also be heading in this direction.  See James Lumley and Caroline Binham, Bloomberg, Lawyers at U.S. Firms Face FSA Insider-Trading Case

(esp)

White Collar Crime in a Nutshell

If you wondered why the white collar crime blog has been a bit slow these past few months, this is one of several reasons. Professor Jerold Israel and I just finished the 4th edition of White Collar Crime in a Nutshell.  For information on the book, see here.

Your readership is appreciated.

(esp)

Conrad Black Asks for Bail Pending a Ruling by the Supremes

Lyle Denniston over at Scotus Blog has Conrad Black's application for bail (see here), and it is noted that the government has until Friday to respond.  In the defendant's favor is the fact that a co-defendant has been granted bail pending appeal.  Further, the fact that the Supreme Court has accepted certiorari is an important consideration (see here).  Despite the summary resolution of the case by the Seventh Circuit (see here), there is a fascinating mail fraud issue that the Court will be reviewing (see here).  The disparity in having one co-defendant on bail, and the other incarcerated seems like a strong argument to grant bail when there has been no indication of a flight risk or a danger to society. But lets see what the Government responds.

(esp)

Enron Broadband's CFO Pleads

A DOJ Press Release reports on Former Enron Broadband Chief Financial Officer Pleads Guilty to Falsifying Books and Records.  "According to the terms of the plea agreement, Howard faces a maximum sentence of up to 12 months of home confinement at his sentencing."  The press release states that "[i]n an attempt to generate earnings sufficient to meet the earnings target, Howard admitted that he and others at EBS structured a transaction known as 'Project Braveheart' designed to 'monetize' or book a portion of the anticipated hundreds of millions of dollars of future earnings from EBS’s agreement with Blockbuster in the fourth quarter of 2000."  But the reality is that Howard had a hung jury the first time around and a conviction vacated the next time.  Most likely the cost of trial, including the psychological cost, made this plea extremely attractive.  

See also Tom Kirdendall, Houston ClearThinkers. Chalk up Another Trial Penalty Deal;Amir Efrati, WSJ Blog, Former Enron Exec Could Get Home Confinement After Plea

Sotomayor and White Collar Crime Opinions

The term "liberal" is not quite the way I see Justice-To-Be Sotomayor, as her white collar crime decisions of the past provide a strong "pro-government" stance. My analysis is based on perusing approximately 100 cases she decided that had the word "fraud" within it. The accuracy of this methodolgy is certainly questionable.

The defendant "wins" are hardly earth-shattering ones.  For example, in Odunaike the court affirmed as modified, with the modification being a reduction of sentence from 87 months to 60 months when the government conceded that the sentence imposed on the count exceeded the statutory maximum.  It is difficult to see this as siding with the defense when the government hands the victory to the defense.

And some of the defense success is only partial.  For example, in U.S. v. Spencer, the panel vacated and remanded a conspiracy count while affirming the commercial bribery count.  And in U.S. v. Griffen, she joined a refusal to allow the government to resolve an issue on an interlocutory appeal. Or the defense might be successful on a partial remand when the Supreme Court issued an opinion that called for a re-examination of the sentence given to the accused. (Thomas, Males, Medes, Bunn, Martinez, Hawkins). And don't think that the remands are all for the defense.  For example, in U.S. v. Barber the remand is because the defendant should not have been given a sentence reduction that the government was appealing. (see also Cotto, Ruttner, Kennedy).

Occasionally, there is a defense victory, as in U.S. v. Dupre where she joined a panel that held that a sentencing enhancement was not proper as evangelical Christians as a class are not "unusually susceptible " to fraud.   Although she did find a sentencing enhancement proper for using lawyer skills in the conduct in another case. (Reich). 

And it is a good thing that the former Mayor of Bridgeport, Connecticut is not ruling on her confirmation as she wrote the decision affirming his conviction finding no prosecutorial misconduct warranting reversal and held the sentence to be reasonable.

There are some reversals, such as when there is a judicial failure to recuse on a case (Amico).  And yes, I did find U.S. v. Samaria, where Judge Sotomayer authored an opinion reversing an alleged credit card fraud case, finding insufficient evidence that the defendant "knowingly and intentionally participated in the crimes charged."

For those who have doubts about her abilities -  I suggest reading U.S. v. George, 386 F.3d 383 (2d Cir. 2004) - as her discussion of the Cheek, Ratzlaf, and Bryan cases and how best to interpret the term "willfully" is very impressive.  And for those who might question her experience, speaking only from a white collar crime perspective, she has ruled on a very wide breadth of cases from securities fraud, mail and wire fraud, money laundering, obstruction of justice, and RICO. She clearly is experienced. 

And to Jeff Skilling, Conrad Black, and others who may have mail fraud cases under the intangible rights doctrine coming up to the Court -- she was not on the defense side in Rybicki.

See also Adam Liptak, New York Times, Nominee’s Rulings Are Exhaustive but Often Narrow ;Scotus Blog, Judge Sotomayor's Opinions with Dissents - Part I; The Dynamic of the Nomination of Sonia Sotomayor; Lefcourt on Sonia Sotomayor in the NYTimes - Voices From a Jurist's History; Doug Berman, Sentencing Law and Policy Blog, Examining Judge Sotomayor's Criminal Justice Record.

(esp)

Addendum - Tony Mauro, NLJ, law.com, Critics Pounce on Sotomayor's Reversal Rate; Marcia Coyle, NLJ, law.com, Big Issues Lurk Below Surface of Sotomayor Confirmation Hearings

In the News and Around the Blogosphere

FraudBlawg, Government Intervenes in New Hospice Fraud Qui Tam Case

Leslie Wayne, NYTimes, A Promise to Be Ethical in an Era of Immorality

Joe Ryan, New Jersey News/Star Ledger, Defense lawyer says prosecutors overstated case

Allan Lengel, ticklethewire.com, Press Spokesman Channing Phillips Named Interim D.C. U.S. Attorney; Joe Palazzolo, BLT Blog, Phillips Is Named Acting U.S. Attorney in D.C.

Sheri Qualters, NLJ, law.com, Mass. Lawyer Sentenced to 87 Months for Money Laundering, Obstruction of Justice

Polyana da Costa, Daily Business Review, law.com, Business Development
Green-card deal lures foreign investors

Chicago Tribune, Ald. Carothers, developer accused of corruption; DOJ Press Release here

DOJ Press Release, Aventis Pharmaceutical to Pay U.S. $95.5 Million to Settle False Claims Act Allegations

Jon Katz, 4th Circuit: Trial courts may not presume reasonableness of Guidelines sentences

DOJ Press Release, Defense Contractor Pleads Guilty to Wire Fraud in Connection with the Procurement of a Bullet-Proof Vest Contract in Iraq

Brian Baxter, American Lawyer, law.com, Weil Partner Takes the Stand in Refco Case

(esp)

New Director at NACDL White Collar Crime Policy Office

Shana-Tara Regon to Lead NACDL White Collar Crime Policy Office here.  The press release states that:

Ms. Regon, formerly of Shipman & Goodwin LLP, Hartford, CT, has represented individual and corporate clients in state and federal civil and criminal investigations. She is a member of the bars of Connecticut and Massachusetts and is admitted to the U.S. Court of Appeals for the Second Circuit. She has represented clients facing a variety of criminal charges including fraud, public corruption, RICO, tax fraud, espionage, felony escape, criminal harassment and assault; and in civil matters such as Qui Tam, Freedom of Information Act and unfair trade practices. She has also served as pro bono immigration counsel for political refugees seeking asylum.

(esp)

Upcoming Conferences

12th Transnational Crime Conference, June 11-13, 2009, New York - here

IncisiveMedia Events, 21st Annual General Counsel Conference, June 9-10, New York - here

NACDL, Defending White Collar Crimes, October 1-2, 2009, New York here

(esp)

New Articles & Books

Alan Ellis & James H. Feldman, Jr., "Intended Loss" Redefined in Fraud Cases," 24 Criminal Justice (2009)    

Pew Center on the States, Arming the Courts with Research - Evidence Based Sentencing Brief

(esp)