March 01, 2009
The Future of White Collar Crime Press Investigations - Bleak
With the final edition of the Rocky Mountain News (see here), with newspapers across the U.S. closing (see here for an map that tracks the newspaper layoffs), one has to wonder about the future of white collar investigations that originate from the press. Press investigations and exposure of corruption have lead to prosecutions. It is frightening to see the dying press, not only because of what this means to having a well informed public, but also from the perspective of having white collar criminality exposed.
January 02, 2009
More on Pardons & Commutations
More on Pardons & Commutations -
Charlie Savage NYTimes, has an article titled On Fast Track for Clemency, via the Oval Office and there are wonderful follow-ups from P.S. Ruckman Jr., Pardon Power, ABC News: Pardon Breakdown and The Times: On Pardons and Access . Some observations -
- The process has its issues and those who are less fortunate and don't have a connection may not have as good a chance of securing a pardon or commutation.
- Politics and/or influence may have played a factor and this needs to be scrutinized.
- The press is monitoring every pardon issued.
It's this last point that interests me. We see newspapers cutting staffs and suffering from the economy and also the effect of the Internet. Investigative reporters have served an important role in society and in uncovering many corruption and white collar crimes. So, too, they serve an important role in keeping the government in check. Will this continue and what happens if we lose the power of the press?
Addendum, Mary Flood, Houston Chronicle, Pardon watch on as transition nears -But it's doubtful any Houstonians will make the cut
March 08, 2008
U.S. Attorney Firings -- The Book
Former U.S. Attorney David Iglesias of New Mexico, one of the seven (or eight or even nine) federal prosecutors fired by the Department of Justice in 2006, will be publishing a book, "In Justice," that discusses his career and the process by which he and the others were terminated. In the fashion of other tell-all books that leak certain details to pique our interest, a story in the McClatchey Newspapers (here) reveals that Iglesias spoke with U.S. Attorney Johnny Sutton of the Western District of Texas, the head of the U.S. Attorneys committee and a close ally of the President, to see if he could intercede to save Iglesias' job. According to Iglesias, Sutton said that his name was on a list, and that the firings were "political." While not exactly earth-shattering, the fact that Sutton was shown the list and acknowledged the political nature of the decision shows how the decision-making process was tainted. Prior to being fired, Iglesias received a call from New Mexico Senator Pete Domenici questioning the slow progress of a corruption case involving a Democrat official, and complained about the case not moving forward quickly enough before the 2006 election. Iglesias was fired less than two months later. There are sure to be further disclosures from the book until its release in a few months. I can't wait for the movie, and I wonder who will play Alberto Gonzales, Monica Goodling, Carol Lam, Kevin Ryan, and the rest of the crew. Iglesias was the model for Tom Cruise's role as a Navy lawyer in "A Few Good Men," but he may not be right for the part this time. Suggestions are welcome. (ph)
December 20, 2007
Will a Perjury Trap Be Set for Roger Clemens on Capitol Hill?
There is nothing quite like a high-profile scandal to attract Congressmen like moths to a flame, and the Mitchell Report on steroid and HGH use in baseball is one of the brightest flames around these days. Two Congressional Committees have scheduled hearings in January on the issue, inviting former Senator George Mitchell and MLB Commissioner Bud Selig to testify. Back in March 2005, in the first round of publicity-mongering on steroids in baseball, the House Oversight and Government Affairs Committee invited a number of major leaguers to testify about steroid use. That hearing produced Mark McGwire's famous non-assertion of the Fifth Amendment when he proclaimed he would only talk about the future -- who cares about what a retired baseball player does after his playing days -- and Rafael Palmeiro aggressively asserting that he never used steroids -- only to test positive a couple months later, thus ending his career.
The prospect of such enticing nuggets showing up on YouTube may well result in one or more invitations to superstar pitcher Roger Clemens to testify about his reported steroid use. Clemens is the highest profile player, perhaps after Barry Bonds, named in the Mitchell Report, and he issued the following statement denying the assertions in the Report: "I want to state clearly and without qualification: I did not take steroids, human growth hormone or any other banned substances at any time in my baseball career or, in fact, my entire life. Those substances represent a dangerous and destructive shortcut that no athlete should ever take." A USA Today story (here) quotes Representative Tom Davis as stating that no players will be subpoenaed, but they are free to appear voluntarily and testify under oath.
The source of the information about Clemens is a former trainer, Brian McNamee, who is reported to have spoken to Mitchell and his investigators pursuant to a proffer agreement with federal prosecutors that limits any subsequent use of his statements against him while requiring him to be truthful. This type of limited immunity, sometimes called a "Queen for a Day" agreement, usually is a prelude to a plea bargain with the government that will include a recommendation of leniency from prosecutors based on the defendant's cooperation. There is no report at this point that McNamee has agreed to plead guilty to any charges, and there's a chance prosecutors could decide not to charge him or even grant full immunity. Either way, the limited protection does not mean he is a credible witness automatically.
Given Clemens' denial and McNamee's statements to Mitchell, could there be much better theater than having them both appear on Capitol Hill, a surefire lead story on the evening news? While statements to the media are not subject to the perjury or false statement laws, much to the consternation of many journalists, testimony before Congress is under oath. If you were Clemens' attorney, would you have your client testify, especially if there were others out there aside from McNamee who could provide information against him? On the other hand, given the clarity of his denial of steroid and HGH use, can counsel advise Clemens not to testify if given the opportunity? While Clemens declined to speak with Mitchell, now that his name it out in public, there will be enormous pressure on him to go to Capitol Hill. In his statement he said "I plan to publicly answer all of those questions at the appropriate time in the appropriate way." Is a Congressional hearing the "appropriate" forum, or was he thinking about perhaps going on Larry King?
Of course, Congress would learn nothing of any importance from having Clemens testify, just like no real legislative purpose was served in 2005 when McGwire, Palmeiro, Sammy Sosa, and others were dragged in front of the Committee -- but not Barry Bonds, as it turns out. The invitation is really asking Clemens to step into a perjury traps because Congressional testimony is under oath, and hence subject to a perjury prosecution. The trap is easily avoided, if Clemens is not subpoenaed to testify, because he can just decline the invitation while castigating the media. Indeed, he may already have laid the groundwork for such a position when his statement included the following: "I am disappointed that my 25 years in public life have apparently not earned me the benefit of the doubt." Perhaps he will simply ask for the benefit of the doubt, but at what cost to his credibility if there's an open invitation to reiterate under oath what he has already said to the media. (ph)
November 09, 2007
Help for Homeless Vets
The Race to the Bottom blog has an interesting post here on ways to provide help for homeless veterans. (ph)
September 02, 2007
ABA Webcast on the McNulty Memo
"Corporate Representation after DOJ's McNulty Memo: The Implications of DOJ Policy for White Collar Defenders, Internal Investigators, Civil Litigators and Everyday Business Advisors."
The program will bring together experts to explain the McNulty Memo, its background and meaning for practitioners in white-collar prosecutions, internal investigations, civil litigation, and everyday corporate practice. Our faculty will offer insight into how DOJ is actually implementing the McNulty Memo, its significance for other government agencies, how lawyers are practicing in light of it, and how critics are taking steps to achieve further restraints.
For more details see here.
August 15, 2007
Washington Legal Foundation Program
Washington Legal Foundation Program -
"Over the past year, criminal defense lawyers, civil liberties advocates, and business associations have been seeking greater protection for white collar defendants’ rights and privileges in the face of increased corporate criminalization. A series of federal court rulings on the constitutional rights of former KPMG executives have helped to fuel the drive for such reform. On Thursday, August 16 from 10:00-11:00 a.m. EST, Washington Legal Foundation will be broadcasting a live Web Seminar examining the ongoing legal drama of U.S. v. Stein and the larger debate over the attorney-client privilege, the ability of companies to pay accused employees’ legal fees, and the McNulty Memo. The discussion features National Association of Criminal Defense Lawyers’ Stephanie Martz, and Lawrence Barcella, a leading white collar crime partner from the law firm Paul, Hastings, Janofsky & Walker LLP.
"We encourage you to interact with our speakers by emailing your questions during the program to email@example.com."
For more information, see here -
August 13, 2007
Is the Government Leaking Information to the Press?
The NYTimes has an article titled, "5 Reporters Ordered to Testify About Government Sources."
April 26, 2007
M&A Law Prof Blog
A new blog that is part of the Law Professor Blogs network is the M&A Law Prof Blog written by my colleague, Professor Steven Davidoff. For those interested in corporate mergers, acquisitions, private equity investments, and the securities markets, it is an interesting read. (ph)
February 14, 2007
Coming to a Theater Near You -- The Collapse of Enron
Perhaps it was inevitable that there would be a movie, and there are reports that leading man Leonardo DiCaprio will star in a movie about the demise of Enron. According to a CNN story (here), the screenplay will be based on Kurt Eichenwald's book "Conspiracy of Fools," and DiCaprio will play a newly-hired employee who exposes the fraud at the company. I suspect the role of Sherron Watkins will be downplayed, and no doubt hints about a conspiracy involving President Bush and major energy companies will have to enliven what is an otherwise mundane story -- it's awfully hard to make the use of an off-shore special purpose entity to transfers assets to avoid the proper accounting treatment of a loan sound the least bit interesting. DiCaprio starred in Titanic, so it will be difficult to resist comparisons to that disaster, and I doubt there will be any scenes on the roof of the Enron tower in Houston. Then again, there are those who claim the government's prosecution of Lay, Skilling, and others was a work of complete fiction anyway, the so-called "criminalization of agency costs" argument, so this story can't be viewed as any more of a fabrication. (ph)
October 13, 2006
Lord Black's "Difficulties"
The Wall Street Jrl here tells of the life Conrad Black is leading despite charges pending against him. Oftentimes those who are alleged to have committed white collar crimes remain hidden during the pendency of the case. Lord Black, however, has been on the social scene, even serving as a speaker at Toronto's Empire Club.
The article also speaks of whether Black is trying to reinstate his Canadian citizenship in case he is convicted, thus allowing him to serve any sentence issued in Canada. Prisoner Transfer Treaties allow a person convicted in one country to serve their sentence in another country. (see here). "However, a prisoner is not eligible for transfer until the judgment and sentence in his case is final; that is, when no appeals or collateral attacks are pending." (Id.) But perhaps this entire conversation is premature as Conrad Black has only been indicted, and that does not mean the government will be successful in proving a case against him.
May 10, 2006
Another New Law Blog
In the burgeoning world of media-sponsored law blogs, the Washington Post has started one called Bench Conference (here) that is written by Andrew Cohen. Another good source of legal information and commentary in the blogging world. (ph)
April 12, 2006
SEC Issues Policy Guidelines for Subpoenas to the Media
The SEC issued a policy statement (here) setting forth its procedures for issuing a subpoena to the media during a formal investigation. The issue came to the forefront in February when the Commission issued subpoenas to three columnists who publish on-line for information about contacts with short sellers of Overstock.com shares. An allegation commonly made against those who specialize in selling short a company's stock -- a bet that the stock will decline -- is that they spread false information through the media and internet to drive down the market price of the shares. The Enforcement Division sought information from the journalists about columns they wrote that contained negative information about Overstock.com, but the subpoenas were withdrawn shortly thereafter due to the storm of criticism regarding interference with the media.
SEC Chairman Christopher Cox issued the new policy, which imposes of number of intermediate steps before the Enforcement Division staff can issue a subpoena to members of the media. First, the SEC must try to obtain the information informally, and contacts should be done through counsel for the journalist rather than by a direct contact. The benefit of this approach is that issues of whether the journalist even has relevant information, and whether a claim of privilege might be raised, can be decided before any further steps are taken. The policy also stresses that other avenues for obtaining the information should be exhausted, and any information sought should be important and not peripheral:
If negotiations are not successful in achieving a resolution that accommodates the Commission's interest in the information and the media's interests without issuing a subpoena, the staff investigating the matter should then consider whether to seek the issuance of a subpoena for the information. The following principles should guide the determination of whether a subpoena to a member of the news media should be issued:
(1) There should be reasonable grounds to believe that the information sought is essential to successful completion of the investigation. The subpoena should not be used to obtain peripheral or nonessential information.
(2) The staff should have exhausted all reasonable alternative means of obtaining the information from non-media sources. Whether all reasonable efforts have been made to obtain the information from alternative sources will depend on the particular circumstances of the investigation, including whether there is an immediate need to preserve assets or protect investors from an ongoing fraud.
Only after working through other possibilities can a request for a subpoena be made, and the decision whether to issue the subpoena will be made by the Director of Enforcement in consultation with the General Counsel. If the decision is made to issue the subpoena, the Chairman must be notified, and the terms of the subpoena negotiated with counsel for the media outlet in advance so that it can be as narrow as possible. Moreover, the policy states that "[i]n the absence of special circumstances, subpoenas to members of the news media should be limited to the verification of published information and to surrounding circumstances relating to the accuracy of published information."
All in all, the Commission's policy will make it very difficult for the Enforcement Division staff to issue subpoenas because of the many layers of review. The policy stresses a cooperative process, in which counsel for the subpoena recipient will work with the staff to shape the information request, rather than an "issue first, ask questions later" approach to obtaining information through the SEC's compulsory powers. (ph)
April 08, 2006
Did A Gossip Columnist Try to Extort Money?
Yahoo News (Reuters) reports here on an investigation of a gossip columnist at a NY newspaper who is alleged to have tried to extort money from an individual in return for not printing a story. Clearly such reprehensible form of conduct would be ethically improper. And if this extortion did occur then there might be also be legal implications, including criminal ones. But the columnist is saying hold on - - on Poynter Online - Romenesko here . He said he is hoping that his paper will "not rush to judgment."
April 03, 2006
Some Avoid the Perp Walk
Isn't it amazing that some have to do the perp walk, and others do not? And isn't it amazing that the ones doing the perp walk do not have a pre-arranged deal with the government?
According to Newsday here, a former business executive at Newsday surrendered to federal officials on charges related to his alleged role in Newsday's circulation scandal. And yes, there was no perp walk. No one appears to be talking, according to Newsday, but one has to wonder what will happen here next. Check out the Newsday article to see what sources are telling them.
March 09, 2006
Former Newsday Executive Pleads
One might say that everyone is attacking the press lately. (Mary Matalin, who spoke along with husband James Carville, at the Hillsborough County Bar Foundation last night, was particularly harsh on the press and press coverage.)
The Government has even had some recent indictments related to the press (see here). And the word is out (here) that the former vice president of circulation of Newsday entered a guilty plea a few weeks ago. The plea was to charges of "mail fraud and income-tax evasion" and includes cooperation on the part of the accused. One can only imagine that with cooperation there will be more to come.
March 08, 2006
Steroid Accusations Against Barry Bonds May Reignite Interest in Possible Perjury Charges
A book by two San Francisco Chronicle reporters called "Game of Shadows" that is scheduled to appear in late March alleges that San Francisco Giants star Barry Bonds became a heavy steroid user beginning in 1998, including the use of some of the strongest drugs available that are injected into the body. Bonds testified before a federal grand jury in San Francisco in 2003 in the BALCO (Bay Area Laboratory Co-Operative) steroid investigation that led to guilty pleas by its founder, Victor Conte, and Bonds' personal trainer, Greg Anderson. Reports of the grand jury testimony indicate that Bonds admitted to going to BALCO's office to have his blood tested and that he used a cream provided by Anderson, but stated he did not know that it contained a designer steroid. Bonds purportedly asserted that he never knowingly took steroids, a position that would be contradicted if the claims in "Game of Shadows" are true.
Whether the book contains anything not already known to federal prosecutors will likely be the key to the possibility that Bonds could face a federal investigation for perjury or obstruction of justice. If the information in the book comes from Anderson, Conte, and others implicated in the BALCO prosecution, then it is likely federal prosecutors already know about it, although perhaps not in as much detail. A perjury case built on the testimony of convicted felons does not strike me as particularly strong, and Conte in particular has been quite erratic in his public statements. In 2005, former major leaguer Rafael Palmeiro testified before Congress that he had never used steroids and then three months later tested positive for stanozolol, one of the drugs Bonds is accused of using. The House committee, however, did not pursue perjury charges because of the lack of evidence that Palmeiro had used steroids before his testimony.
This type of case is difficult to win because the government must prove that the defendant lied, and not just that the person was less-than-forthright in the testimony. Bonds admits to using something that turned out to contain steroids, and does not deny his interactions with BALCO. Did he lie before the grand jury, or was he just perhaps just evasive? More than accusations in a book containing sensational claims of continued steroid use will be needed to pursue a criminal prosecution. A Yahoo Sports column (here) by Jeff Passan discusses the book. (ph)
February 27, 2006
Respect for the Press
Subpoenaing the press will not be haphazard at the SEC. The Wall Street Journal reports here that Securities and Exchange Commission Chairman Christopher Cox will require commissioner notification prior to subpoenaing documents from journalists. This policy comes in the aftermath of a subpoena that had been issued to two Dow Jones & Co. journalists.
Internal agency policy on issues of this magnitude is important to protect against individual decision-makers, who may have enormous discretion, acting in variance with others with the same discretionary power. Approval not only will provide oversight to these policy decisions, but also allow the agency to operate with some uniformity in making such decisions.
February 23, 2006
The Libby Website -- New Motion to Dismiss the Indictment
The legal defense fund for I. Lewis Libby has a website (www.scooterlibby.com) with information about Libby, a list of the fund's Advisory Committee that includes a number of former administration officials and senators, and links to recent headlines. The fund's trustee is G. Michael Green, a tax lawyer at Dickstein Shapiro in Washington, D.C.
The site links to an AP story (here) discussing the response of Libby's lawyers to the "greymail" accusation made by Special Counsel Patrick Fitzgerald, that Libby seeks a large volume of classified materials as part of a strategy to obtain a dismissal of the charges under the Classified Information Procedure Act (see earlier post here). The response of defense counsel is that the greymail accusation "is not only false, but insulting" -- an almost sure sign that the defense strategy includes seeking a means to have the charges dismissed under CIPA. But that's not the only avenue for seeking dismissal. Also available on the website is Libby's motion to dismiss the indictment (here) filed on Feb. 23. The motion asserts that the appointment of the Special Counsel violates the Appointments Clause (Art. 2, Sec. 2), which requires the advice and consent of the Senate for a "principal officer" who can exercise the power of the United States to approve an indictment and prosecute a case without further supervision by a superior officer. Because Fitzgerald's office need not obtain the prior approval of the Attorney General or U.S. Attorney before seeking an indictment, he can only be appointed after the advice and consent of the Senate, according to Libby's brief. Needless to say, in the current political climate, I suspect Fitzgerald's nomination would sail through the Senate if that were necessary. This new front in the litigation could cause a delay in the trial if U.S. District Judge Reggie Walton agrees with the defense argument because it would trigger an immediate appeal, or perhaps Senate approval of Fitzgerald's appointment and a reindictment. (ph)
February 21, 2006
Skip TV and Movies - Go Watch Ryan's Case
You can skip TV and the movies and just go sit in the courtroom trial of former Governor Ryan, as the stars have been parading to the witness stand. According to the Chicago Tribune here, the defense witnesses have included "Hollywood actor Mike Farrell, who played B.J. Hunnicut on TV's 'M.A.S.H'" and Sister Helen Prejean, who authored best-selling movie "Dean Man Walking." The defense has also managed to secure testimony from "U.S. Attorney Edward E. McNally, chief federal prosecutor in the Southern District of Illinois." (See CNN here) But the most important witness for the defense may be Ryan's doorman, a witness who will be able to provide direct knowledge that Ryan is an honest and caring man.