Thursday, June 19, 2014

DOJ Narrows Basis for Section 1001 Prosecutions

According to a May 12, 2014 article in the National Law Journal (Tony Mauro, "DOJ's Quiet Concession:  U.S. gives up a widely decried charging theory."), the Department of Justice has quietly narrowed the scope of 18 U.S.C. 1001, the statute that makes lying to an FBI or other government agent a five-year felony.  The statute -- perhaps most notably used to send Martha Stewart to jail when the government couldn't make out an insider trading case against her -- makes it a crime to "knowingly and willfully" make materially false statements in any matter under federal jurisdiction, including lying to an FBI agent.  The government now has conceded that, in order to prove that a defendant accused of a Section 1001 violation acted "willfully," it must show that she knew that her action making or providing a false statement was unlawful.

The change in government attitude was mentioned in low-profile submissions to the Supreme Court containing confessions of error.  The Supreme Court has already returned at least two cases to lower courts for further consideration in light of the concessions.

The most questionable use of the statute, in my opinion, has occurred when agents without prior notice confronted an individual about a purported crime she committed and elicited a knee-jerk exculpatory false denial (although such denials are now to my knowledge infrequently prosecuted).  Prosecutors and agents may now have to forego prosecutions where targets or witnesses lie to them (in the field or their offices) or alternatively give those targets and witnesses a warning that a false response to the government questions is unlawful., which, of course, may discourage them from talking.

(Hat Tip to Monroe Freedman and Steve Lacheen.)

(goldman)

 

June 19, 2014 in Investigations, Prosecutors, Statutes | Permalink | Comments (0) | TrackBack (0)

Wednesday, June 18, 2014

Italian Accused of U.S. Antitrust Crime Extradited After Switching Planes in Germany

With the growing internationalization of business crime, the question of when a foreign national may be extradited to the United States for crimes charged in the United States is arising more frequently.  Generally speaking, under the requirement of "dual criminality," a resident of a foreign country charged in the United States will not be extradited if the country he is residing in does not deem his conduct criminal.  If, however, that person travels from his "safe haven" home country to another country (even in transit) where such conduct is criminal, he may be extradited.

As reported in a recent Wilmer Hale article, see here, Romano Pisciotti, an Italian citizen charged with an antitrust bid-rigging violation in 2010, this April was extradited from Germany after the connecting flight on his trip from Nigeria to Italy landed there.  Germany generally criminalizes bid-rigging; Italy generally does not.  Presumably, had Pisciotti not left Italy, he would not have been arrested. 

Pisciotti's extradition demonstrates that foreign residents indicted in the United States who are not extraditable from their home country (some nations, like Germany, will not extradite its own citizens other than to another European Union country or the International Criminal Court, for instance) take a considerable risk whenever they travel away from their country of residence.

(goldman)

June 18, 2014 in Antitrust, International, Prosecutions, Travel | Permalink | Comments (0) | TrackBack (0)

In the News & Around the Blogosphere

DOJ Press Release, Former CEO and CFO of Arthrocare Corporation Convicted for Orchestrating $400 Million Securities Fraud Scheme

Libby Longino, Women and White-Collar Crime

James Aldridge, San Antio Business Journal, Three San Antonio PEO owners sentenced for fraud (discussing the largest tax fraud case in San Antonio - Lawyer Gerald Goldstein represented an individual who received probation - and this was without a 5K1.1).

Paul Hastings Press Release, Seasoned Government Lawyer Joins Paul Hastings in New York as Firm Continues Growth of Investigations and White Collar Defense Practice (John Nowak - who was Deputy Chief of the Business and Securities Fraud Section of U.S. Attorneys Office, ED New York)

Paul Hastings Press Release, Respected White Collar Team Joins Paul Hastings in Washington, DC (Michael Levy, Michael Spafford, Amy Carpenter-Holmes).

Day Pitney Press Release, Robert Appleton, Former U.S. Prosecutor and United Nations Corruption Fighter, Joins Day Pitney's White Collar Defense and Internal Investigations Practice

Blank Rome Press Release, Blank Rome Welcomes New White Collar Defense Of Counsel Jed M. Silversmith

(esp)

June 18, 2014 | Permalink | Comments (1) | TrackBack (0)

Tuesday, June 3, 2014

Tilting Toward a Travesty in Texas: The Wallace Hall Referral

If it was not such a serious abuse of power, it would almost be funny. It certainly has its comic elements. Wallace Hall is a Member of the University of Texas System Board of Regents, appointed to that position in 2011 by Governor Rick Perry. The Board of Regents is the governing body for the entire University of Texas System. Hall started snooping around and uncovered several things that troubled him, including:

1. An allegedly secret forgivable loan program for favored law professors at the University of Texas School of Law.

2. Allegedly incorrect accounting treatment of certain in-kind donations to the University's fund-raising campaign. The University had to restate its fund-raising figures after the Council for the Advancement and Support of Education rejected the school's accounting theory.

3. Admission of students to the University of Texas School of Law who had LSAT scores below the average for entering U.T. Freshlaws. Some of the admitted students were related or connected to powerful state legislators with key roles in funding the university and law school.

That last revelation was apparently too much for the legislature (or "the leg" as we called it in my day) and impeachment hearings were commenced by the House Select Committee on Transparency in State Agency Operations ("Transparency Committee").

As I said, the controversy has had its comic moments. The Transparency Committee voted to recommend impeachment of Hall before deigning to draft any Articles of Impeachment. And Transparency Committee Co-Chair Dan Flynn wrote a public letter stating that: 1) there were insufficient grounds to impeach Hall; 2) Hall should resign anyway; and 3) Hall should be impeached if he did not resign. When Hall refused to resign, Flynn voted to impeach him. (The Texas Tribune has a good story here on Flynn's remarkable letter and the response he received from Representative Eric Johnson. Both letters are attached to the story in PDF format.)

The fight between Hall and the legislature is apparently part of a larger years-long battle between th Board of Regents and UT President Bill Powers. The Regents have Governor Perry and company on their side and Powers has legislative allies on his. I'm not concerned about that. I have reviewed Hall's purportedly impeachable offenses and find the allegations against him unpersuasive, but I would not be writing about these things on a white collar blog if impeachment hearings were the only thing going on. Unfortunately, there's more.

The Transparency Committee's Co-Chairs also referred Hall to the Travis County District Attorney's Public Integrity Unit, which has opened an investigation into possible criminal wrongdoing by Hall. This is the same office that brought dubious charges against former U.S. House Speaker Tom DeLay and has a long history of questionable public corruption prosecutions. The Public Integrity Unit is an odd creature of Texas law, housed in the Travis County DA's Office with statewide jurisdiction to investigate and prosecute state officials. The old Travis County DA was Ronnie Earle. The current Travis County DA is Rosemary Lehmberg, an Earle disciple, who refused to resign from office after pleading guilty to Driving While Intoxicated.

One of the House Transparency Committee members made the mistake of asking the U.T. System to review whether Hall had violated state or federal law. The U.T. System hired outside counsel Philip Hilder, a nationally known and well-regarded white-collar heavyweight, to research the issue and write a report. The Hilder Report found "no credible evidence" that Hall violated the Texas Government Code or "any other state or federal law."

In a normal world Hall would be breathing easier. But with the Public Integrity Unit lurking in the background, anything is possible.

To me Hall looks like a classic whistle-blower, albeit a powerful one. He may not have the purest of motives. I really don't know and certainly don't care. But he has uncovered, or helped to uncover, potentially serious problems in the U.T. System. His reward? A criminal referral by the powerful interests whom he has offended. And that is an outrage.

(wisenberg)

June 3, 2014 in News, Prosecutors | Permalink | Comments (0) | TrackBack (0)

Monday, June 2, 2014

Second Circuit Reverses Convictions Due to Prosecutorial Misconduct and Exclusion of Good-Faith Evidence

The Second Circuit Court of Appeals, which issues complete reversals in only about five percent of the criminal cases it hears, last week in an opinion by Judge Jed S. Rakoff (sitting by designation) reversed the trial conviction of two individuals and a corporation for environmental crimes involving asbestos removal, and ordered a new trial.  United States v. Certified Environmental Services, Inc., et al. (see here).  The reversal was based on the denial of a fair trial due cumulatively to the exclusion of evidence of good faith to demonstrate the defendants' lack of intent (an issue not discussed here) and prosecutorial misconduct in improper "bolstering" during the opening and closing arguments.  The Court denied that part of the defendants' appeal based on Brady v. Maryland.

The decision does not concern any novel legal grounds.  Perhaps most significant in the white-collar area is its detailed discussion of the proper and improper use by prosecutors of the cooperation agreements their witnesses commonly enter into with the government.  Since many, probably most, white-collar cases involve cooperating government witnesses, prosecutorial introduction of and comments on cooperation agreements frequently occur in white-collar trials.  Here, the prosecutor improperly bolstered the witnesses' testimony on numerous occasions, both in the opening and closing arguments, by referring directly and indirectly to the self-serving language that prosecutors routinely place in the cooperation agreements they draft to the effect that the witnesses are obligated to tell the truth.  Prosecutors and defense attorneys would do well to review the opinion to determine when and how the government may disclose and use the truth-telling requirement language of cooperation agreements during testimony and in argument.

The opinion also excuses, but does not condone, the improper failure of the government to turn over handwritten notes by a testifying agent which were discovered in the later examination of another agent and belatedly revealed to the defense.  The notes should have been revealed earlier, says the Court, not only since they included evidence favorable to the defense, but also pursuant to Fed. R. Crim. Pro. 16(a)(1)(B)(ii), a discovery rule, and 18 U.S.C. 3500, the Jencks Act.  However, since the notes were, however belatedly, turned over and the defense had an opportunity to review them, examine the later-testifying agent about their content, and recall the earlier witness if it chose, and since their timely disclosure would not have changed the verdict, in any case there was no Brady violation.  The opinion thus demonstrates that late provision of Brady (or Rule 16 or Jencks) by the government during trial will virtually never be grounds for reversal, at least not in the Second Circuit.

 (goldman)

June 2, 2014 in Environment, Judicial Opinions, Legal Ethics, Prosecutors | Permalink | Comments (0) | TrackBack (0)

Thursday, May 29, 2014

Credit Suisse Conviction Does Not Demonstrate Substantial Change In Department Of Justice Enforcement

The Department of Justice (DOJ) and Attorney General Eric Holder were strutting last week over the criminal conviction by plea of guilty of Credit Suisse, a major financial institution.  "This case shows that no financial institution, no matter its size or global reach, is above the law," declared the Attorney General.  Recent prosecutions of major financial institutions had resulted in lesser results,  "deferred prosecutions," a somewhat deceptive term for "delayed dismissals," or a guilty plea by a minor affiliate.

The Credit Suisse guilty plea does not represent a sea change in the attitude of DOJ toward major financial institutions; rather, it appears to be a small ratcheting-up of the baseline penalty for serious criminal financial acts by such institutions.  Credit Suisse, despite paying a hefty $2.6 billion fine, will not suffer the severe collateral consequences that ordinary individual defendants do upon a criminal conviction.  (See here, NACDL's report "Collateral Damage:  America's Failure to Forgive or Forget in the War on Crime -- A Roadmap to Restore Rights and Status After Arrest or Conviction," released today, Thursday, May 29, 2014.)  It will still be able to act as an investment advisor, due to waivers agreed to by federal and New York State governmental agencies.  Thus, its conviction, according to its chief executive Brady Dougan, will not have "any material impact on our operational or business capabilities."  In other words, for Credit Suisse, it will be business as usual. 

I hold no sympathy for Credit Suisse.  Its crimes, continuous and notorious, have enabled American citizens and citizens of other countries to launder and evade tax payments on billions of dollars.  In effect, Credit Suisse (not alone among Swiss banks) (see here) was a criminal enterprise, for many years making huge profits from extraordinary fees for its knowing and willful provision of a presumably safe haven for untaxed income, ill-gotten or otherwise.  Mr. Dougan had stated to a Senate hearing in February that the tax evasion scheme was the work of a small group of private bankers that was hidden from senior management.  That hard-to-believe claim was challenged in a statement by Schweitzerisher Bankpersonalverband, the organization representing the bank's employees:  "It was common knowledge that tax evasion was the strategy, a business model pursued by many banks for a long time."  See here

To be sure, Credit Suisse's crimes did not cause the vast hardship to tens of millions of Americans that the wrongs -- criminal or not -- of other major financial institutions did in the last several years.  And, further, its acts -- while subject to the long-arm jurisdiction of American courts -- were apparently legal under Swiss law, and seemingly condoned by the Swiss government.

Some commentators have suggested that there is considerable unfairness in prosecuting corporations for acts of low- or mid-level employees without knowledge of corporate leaders (see here), a position with which I generally agree.  The demi-prosecution of Credit Suisse, however, does not appear to fit within that category, despite Mr. Dougan's claim.  I see no unfairness in the government's requiring Credit Suisse to plead guilty.

I do, however, wonder about the effectiveness of the insistence on a guilty plea if the collateral consequences are waived.  The conviction of a major financial institution with a considerable financial penalty but a waiver of regulatory bars is to me little different from a civil finding of wrongdoing with such a penalty.  Other than its current status as a convicted felon, Credit Suisse today is essentially in the same position it was two weeks ago.

Given the legitimate (but probably exaggerated) fear that a felony conviction of a major financial institution without regulatory waivers will have on its existence and thus on the economy and societal well-being, it may well be that guilty pleas (and trial convictions too) of such corporations should be accompanied by limited collateral consequences.  Such prosecutions, however, will then serve little more than a symbolic purpose (which I accept as a legitimate purpose).  Overall, DOJ's prosecution to conviction of Credit Suisse is a positive step, albeit a small one.

The resolution here suggests again that the criminal process is inadequate to prosecute large financial institutions.  Society looks to the criminal law to solve far more problems than the criminal law is capable of solving.  Meaningful reform of a flawed financial system will not come from criminal prosecutions of corporations, but, if at all, from strong, substantial regulatory rulemaking and non-criminal legislation.

 (goldman)

 

May 29, 2014 in Current Affairs, Deferred Prosecution Agreements, International, Money Laundering, News, Prosecutions, Prosecutors, Tax | Permalink | Comments (0) | TrackBack (0)

Wednesday, May 28, 2014

In the News & Around the Blogosphere

Thursday, May 22, 2014

DOJ Announces Policy Favoring Electronic Recording of Statements

The Department of Justice (DOJ) on May 12, 2014 issued a memorandum creating "a presumption" that the Federal Bureau of Investigation (FBI), Drug Enforcement Agency (DEA), Bureau of Alcohol, Firearms, Tobacco and Explosives (AFT) and United States Marshals Service (USMS) electronically record, if possible videotape, post-arrest statements made by individuals in their custody in a place of detention, essentially FBI and local police offices and detention facilities, where the facility has suitable equipment.  Additionally, agents and prosecutors are encouraged to consider electronic recording in circumstances where the presumption does not apply.  This policy is not intended to create any enforceable rights for arrestees.

This is a significant change and DOJ should be commended.  Historically, the FBI, in particular, has resisted recording conversations and in fact has had a formal policy prohibiting it without special permission from a supervisor.  FBI memoranda stated that recording "may interfere with and undermine . . . successful rapport building techniques" and that "perfectly lawful and acceptable interviewing techniques do not always come across in recorded fashion to lay persons as proper means of obtaining information from defendants."  A transcript of the testimony of an FBI agent in a 2013 trial reads: 

                           Q:  Does the FBI have a policy of recording interviews?

                           A:  We do not record interviews.

Civil liberties and defense lawyer groups have been seeking such a policy for well over a decade.  Indeed, I wrote an NACDL president's column on the subject in December 2002.  The cynical have believed that the FBI refusal to record investigations was in order to allow agents to use tough, deceptive and coercive methods to induce confessions and then testify to a sugar-coated sanitized version of the interrogation.  The more cynical have believed it gave FBI agents a license to lie with impunity about what the defendants said or did not say.

I believe recording interrogation is a win-win situation.  Jurors will be able to see and hear the circumstances surrounding the questioning and the specific words and tones used by the agents and the defendant.  Agents will be discouraged from shading testimony as to their methods and the defendant's statements.  Defendants and defense lawyers will be unable to argue effectively that the defendants did not make the statement they actually did or claim that they were beaten or coerced when they were not.

To be sure, the memorandum does not require, as some civil liberties and defense lawyer groups have advocated, that the recording begin at arrest.  Thus, there still remains the possibility that agents will coerce statements on the way to the place of detention and lie about it or falsely state that the defendant confessed, or that defendants who did make admissions upon arrest will deny it before the jury.

Nonetheless, this is an important positive step toward presenting the triers of fact with accurate best-evidence versions of events so that they will reach a more just determination.  It will reduce the number of unjust convictions and perhaps unjust acquittals also.  Every law enforcement agency -- federal, state and local -- should adopt such a policy, absent special reasons.  The federal government should require it as a condition of a state police agency receiving federal support.

(I just received notice that Martin Tankleff, who was released from prison in 2007 after serving 17 years upon a wrongful conviction for killing his parents based on a false confession when he was 17 years old, will graduate from Touro Law School this Sunday.  Had Marty's confession been recorded, Marty would very likely not have been convicted.  Marty has vowed to dedicate himself to becoming an advocate for the wrongfully convicted.  Congratulations, Marty; consider this policy a graduation present from DOJ.)

(goldman)

May 22, 2014 in Current Affairs, Prosecutors | Permalink | Comments (0) | TrackBack (0)

Wednesday, May 21, 2014

New York Legislators Propose Commission on Prosecutorial Misconduct

 Two New York State legislators have proposed the creation of a state commission on prosecutorial misconduct to review and investigate complaints of prosecutorial misconduct and to discipline prosecutors who have been found to have acted improperly.  See here.

The proposed commission would, it is said, be the first in the nation of its kind.  It will be modeled upon New York's Commission on Judicial Conduct,  which investigates allegations of misconduct by judges and, if misconduct is found, may discipline a judge by public admonition, censure or removal from the bench.

Virtually every state (but not the federal government) has a commission on judicial conduct  and these commissions,  it is generally agreed, have had a positive effect in limiting judicial misconduct, removing unfit judges who had committed serious misconduct and increasing public confidence in and awareness of the workings of the court system.  (I note that I am a past chair of New York's Commission.)  There is, I believe, no good reason that there should not be an analogous agency to review instances of alleged prosecutorial misconduct, sanction offending prosecutors, and remove the most serious offenders from their positions.  Indeed, there are stronger reasons for a commission concerning prosecutorial misconduct than for one concerning judicial misconduct.  Much of the most serious prosecutorial misconduct, such as concealing exculpatory material and suborning perjury, occurs in the investigative and preparatory stages of a case and is hidden from the view of judges, defense attorneys, and the public and thus not detectable and reviewable by a court.  Almost all judicial misconduct, on the other hand, occurs on the bench in public view, is recorded and observed by lawyers and the public, and is readily reviewable by appellate courts.

With rare exception, see here, prosecutorial misconduct has gone unpunished by prosecutorial offices, bar disciplinary committees and judicial authorities.  Although grievance committees have authority over the improprieties of prosecutors as much as other lawyers, they have historically shown little interest in sanctioning prosecutorial misconduct.  See, e.g., Gershman, Reflections on Brady v. Maryland, 47 S. Tex. L. Rev. 685 (2006); Yaroshefsky, Wrongful Convictions:  It is Time to Take Prosecution Discipline Seriously, 8 D.C. L. Rev. 275 (2004).  Similarly, judges, even when they reverse a conviction due to egregious prosecutorial misconduct, almost always conceal the prosecutor's identity and rarely refer the prosecutor for professional discipline.  And, prosecutorial offices themselves often defend on appeal and thus ratify even serious misconduct of line prosecutors, and fail to sanction even those prosecutors whose serious misconduct they concede.  See, Rudin, The Supreme Court Assumes Errant Prosecutors Will Be Disciplined By Their Offices or the Bar:  Three Case Studies That Prove That Assumption Wrong, 80 Fordham L. Rev. 537 (2011).

Further, potentially criminal misconduct by judges may be investigated and prosecuted by the District Attorney, an agency wholly independent from the judiciary.  However, except in the extremely rare instances where a special prosecutor is appointed, potentially criminal misconduct by prosecutors generally may only be investigated or prosecuted by the very same prosecutorial office that committed that misconduct, which in almost all instances will be hesitant to prosecute one of its own and embarrass the office.

Additionally, there is a stark imbalance in the adversarial criminal justice system where one adversary -- the prosecutor -- may criminally charge the other adversary -- the defense attorney -- when he  tampered with evidence or suborned perjury, but where the defense attorney who believes the prosecutor committed such criminal acts may only make a shout in the wilderness by a futile complaint to an overprotective disciplinary agency with no criminal prosecution power.  A commission on prosecutorial conduct will not wholly right this imbalance, but will tilt it in the right direction.

(goldman)

May 21, 2014 in Legal Ethics, News, Prosecutors | Permalink | Comments (0) | TrackBack (0)

Tuesday, May 20, 2014

Former Wellcare Individuals Sentenced

The sentencing of three former Wellcare individuals demonstrates the importance of having the guidelines as advisory, and the importance of an independent judicary that can recognize that sentences should be about individuals and not about arithmetic. (see here) Hats off to Hon. James S. Moody for being a judge that went beyond the math in sentencing the individuals and for his recognition that the stigma and collateral consequences of a conviction for a white collar offender are huge.  With little chance of recidivism, strict guideline sentences were unwarranted here. (see here)

 The court gave Todd Farha three years (significantly below the number asked for by the government).  Paul Behrens received a sentence of 24 months; William Kale a year and a day, and Peter Clay 60 months of Probation.  The attorneys representing these individuals were: 

Todd Farha: Barry Boss, Stephen Miller, Rebecca Brodey, Seth Waxman, Peter Neiman, Alan Schoenfeld, Robert Stauffer, Laura Vaughan

Paul Behrens: John Lauro; Jeffrey Lamken; Michael Matthews, Michael Califano

William Kale: Stan Reed, Patrick Donahue, Lauri Cleary, Larry Nathans

Peter Clay: Bill Jung, Larry Robbins, Donald Burke.

(esp)

May 20, 2014 in Defense Counsel, Fraud, Sentencing | Permalink | Comments (0) | TrackBack (0)

Sunday, May 18, 2014

In the News & Around the Blogosphere

Blank Rome hires Carlos Ortiz as a partner in the White Collar Defense and Investigations Group- here

Scott Neuman, NPR, Congress Holds Former IRS Official Lois Lerner In Contempt

Tony Mauro, NLJ, U.S. gives up a widely decried charging theory

Todd Ruger, Legal Times, Leslie Caldwell Confirmed to Lead DOJ Criminal Division

(esp)

May 18, 2014 in News | Permalink | Comments (0) | TrackBack (0)

Friday, May 16, 2014

Too Big To Jail: Do Guilty Pleas Matter?

Here is an unusually sophisticated article about a white collar topic in today's NYTimes. The piece, by Floyd Norris, probes what are essentially debarment waivers obtained by many financial and brokerage institutions as part of their global deals with DOJ and SEC. A guilty plea or deferred prosecution agreement with DOJ, accompanied by an SEC fine and censure, in the past may have been a company's death knell. Now it is just another cost of doing business. Naturally, guilty pleas still look bad and companies want to avoid them. But there's a rather large difference between a short-term public relations nightmare (or even a long-term and expensive monitoring agreement) and a firm's demise. So when government officials say that no companies are too big to jail or too big to fail, it is important to understand the context of the particular global agreement in question. Because a company can't be jailed, and if the company is big and important enough, it won't be allowed to fail.

(wisenberg)

 

May 16, 2014 in Civil Enforcement, Current Affairs, Deferred Prosecution Agreements, SEC, Securities | Permalink | Comments (0) | TrackBack (0)

Thursday, May 15, 2014

White Collar Sentencing is Not All About Loss

An amici brief was filed by a group of law professors and practitioners in support of  three defendants in United States v. Farha.  It's unusual to see amici coming in at the trial level, but this esteemed group offers some important reasons for allowing this brief. 

They note "that this case highlights a serious problem facing federal sentencing judges today - namely, that the federal sentencing guidelines as currently written place too much emphasis on economic 'loss' and too little emphasis on other factors that traditionally have been important factors in determining a fair and just sentence that takes full account of the factors set forth in 18 U.S.C. s 3553(a)." In addition to discussing the distortion caused by the loss guidelines, the authors of this brief also note how other judges have recognized that focusing on loss under the guidelines presents problems. As aptly noted by Hon. Jed Rakoff, the guidelines "tend to place great weight on putatively measurable quantities, such as .....the amount of financial loss in fraud cases, without however, explaining why it is appropriate to accord such huge weight to such factors."  (United States v. Adelson).

Hopefully the court will note the growing number of judges that reject strict adherence to a sentence that is ascertained solely by examining numbers and will remember that we sentence people, not numbers.

 See Amici- Download AmiciBrief 

(esp)

May 15, 2014 in Defense Counsel, Fraud, Sentencing | Permalink | Comments (0) | TrackBack (0)

Tuesday, May 13, 2014

Corporate Criminal Liability: Recent and Noteworthy

Josh Greenberg and Ellen Brotman have written a timely and informative article entitled Strict Vicarious Liability for Corporations and Corporate Executives-Stretching the Boundaries of Criminalization for Volume 51 of the American Journal of Criminal Law. The article, and related pieces on criminal liability in the corporate context by Mark Filip, Julie O'Sullivan, Barry Pollack and others, can also be found on the Journal's website at http://www.americancriminallawreview.com/.

 

(wisenberg)

May 13, 2014 in Scholarship | Permalink | Comments (0) | TrackBack (0)

Thursday, May 8, 2014

The Taslitz Galaxy: A Gathering of Scholars at Howard - Friday, September 19th, 2014

Howard University School of Law is hosting a conference in honor of Andrew Taslitz, who died on February 9, 2014. It is not a traditional symposium, for we expect concurrent sessions on many subjects. It is open to people who knew Taz and to those who were inspired by his writing or teaching. If you would like to take part in the live event, please submit an abstract by May 30, 2014 to the co-chairs named below. The conference is free but speakers must pay their own way.

Send abstact to co-chairs:

Josephine Ross      JRoss.howardlaw@gmail.com

Lenese Herbert      LHerbert@law.howard.edu

Ellen Podgor         EPodgor@law.stetson.edu

For more details, see here - Download Andrew Taslitz Galaxy

May 8, 2014 in Conferences | Permalink | Comments (0) | TrackBack (0)

Monday, May 5, 2014

Supremes Rule Unanimously: Property=Money Under MVRA

This morning in Robers v. United States (2014), the U.S. Supreme Court resolved a circuit split and unanimously affirmed the Seventh Circuit. The Mandatory Victim Restitution Act of 1996 requires offenders to pay their victims "an amount equal to...the value of the property" taken, minus "the value (as of the date the property is returned) of...the property that is returned." The Supreme Court, through Justice Breyer, held that the "property" in question is money, rather than real property. Thus, Appellant's argument that his criminal restitution judgment, payable to the bank he defrauded through his straw purchases, should have been reduced by the value of the two properties securing the two loans on the day that the bank took the properties back, was rejected. The sentencing court had determined its restitution figure by subtracting the amount of money the bank received through sale of the two houses from the original loan amount. The Court approved this approach. The Court did note that the statute has a proximate cause component and that offenders may be able to show in some instances that intervening factors broke the causal chain. But Appellant failed to make this argument at the district court level. Justice Sotomayor, joined by Justice Ginsburg, joined in the Court's opinion, but expounded upon the proximate cause issues in a separate concurrence.

(wisenberg)

May 5, 2014 in Fraud, Judicial Opinions | Permalink | Comments (0) | TrackBack (0)

Saturday, May 3, 2014

Cyberstalking Statute Survives First Amednment Challenges in the First Circuit

Yesterday in United States v. Shawn Sayer, the First Circuit ruled that that a portion of the federal cyberstalking statute, 18 U.S.C. Section 2261A (2) (A), is constitutional as applied to defendant Sayer's actions and is not facially overbroad. The Court held that Sayer waived his void for vagueness challenge. The facts were undisputed and the case involved a multi-year effort by Sayer to harass his ex-lover by, among other things, posting their intimate sex tapes on pornographic web sites and inviting male strangers to contact her for sexual activity. The Court also approved the trial court's upward variance/departure.

(wisenberg)

May 3, 2014 in Computer Crime, Judicial Opinions | Permalink | Comments (0) | TrackBack (0)

Thursday, May 1, 2014

Fourth Circuit Confirms: "I'm My Own Grandpa."

Well. It's complicated.

Can your co-conspirator also be your victim? Your darn tootin' he can, under the Hobbs Act, according to the Fourth Circuit.

In 2007, the Sixth Circuit ruled that the victim of a Hobbs Act conspiracy must be a person outside of the alleged conspiracy. The case is United States v. Brock, 501 F.3d 762 (6th Cir. 2007). This decision seems to have common sense on its side. How can your victim be your co-conspirator, unless you are the Symbionese Liberation Army?

Prior to Brock, the Fourth Circuit had taken a more nuanced and sophisticated view in United States v. Spitler, 800 F.2d 1267 (4th Cir. 1985). There the Fourth Circuit noted a difference between "mere acquiescence" by an extortion victim, which would NOT render him a Hobbs Act co-conspirator, and "active solicitation", which would. "Refusing to paint with a broad brush," the Court ruled that Spitler's conduct was closer to "active solicitation" than "mere acquiescence."

On Tuesday, in United States v. Samuel Ocasio, the Fourth Circuit refused to abandon Spitler in favor of BrockOcasio involved the notorious Baltimore City Police Department towing scandal, in which city cops steered accident victims to a particular towing service in return for kickbacks. Ocasio, a former Bawlmer cop, claimed that, as a matter of logic, he could not have conspired with the towing service owners who were his alleged victims. The Fourth Circuit disagreed, applied the Spitler test, and found the towing service owners' actions closer to "active solicitation" than "mere acquiescence." According to the Court, the plain and unambiguous text of the Hobbs Act compels the conclusion that one CAN conspire with one's victim.

Hat Tip to Lonzo and Oscar.

(wisenberg)

May 1, 2014 in Judicial Opinions | Permalink | Comments (0) | TrackBack (0)

Wednesday, April 30, 2014

Recent and Noteworthy

The Tenth Circuit explains the rather Talmudic distinction between a material omission, which requires the government to prove the defendant's duty to disclose, and a half-truth, which imposes no such requirement on the government. The case is  U.S. v. Charles Homer Chip Sharp (10th Cir. 2014) (omission in mail fraud). I'm surprised that no academic has done a study on the number of white collar defendants named Chip and Skip.

The Third Circuit's current willful blindness instruction is a vast improvement over its old one.  It survives a valiant and brilliant attack from appellate guru Peter Goldberger in U.S. v. Abdur Razzak Tai.

Here's a novel idea. Before a defendant can be sentenced, the jury has to actually render a guilty verdict. The Fourth Circuit provides remedial instruction in U.S. v. Saul Ramirez-Castillo.

(wisenberg)

 

April 30, 2014 | Permalink | Comments (0) | TrackBack (0)

Tuesday, April 29, 2014

In My Expert Opinion The Defendant Is A Liar

This post isn't about a white collar case, but America is our beat. Yesterday the Tenth Circuit reversed the bank robbery conviction of Stanley Hill, because FBI Special Agent Charles Jones (qualified as an "expert" trained in "special tactics and ways to identify deception in statements and truth in statements") testified that Hill's answers during a government interrogation were "not worthy of credence and 'did not make sense.'" Jones also testified that Hill "displayed evasive behaviors 'common among the criminal element to keep law enforcement at bay'" during interrogations. When asked about Hill's purported statement that he would rather die than face charges, Jones opined that "[n]ever in my career have I seen that with an innocent person." Finally, in discussing Hill's frequent invocation of God during the interrogation, Jones told the jury "'[m]y training has shown me...when people start bringing faith into validating their statements, that they're deceptive. Those are deceptive statements.'"

The surprise here is not that the Tenth Circuit found plain error and reversed. The surprise is that a DOJ trained prosecutor would ever put on such testimony in the first place. The surprise is that a federally trained public defender  CJA Panel Attorney would sit like a potted plant and fail to object to such flagrantly inadmissible testimony. The surprise is that a United States District Court Judge with even a cursory understanding of the Federal Rules of Evidence and due process would allow such testimony to go forward. Of course the Tenth Circuit panel went out of its way to absolve the trial court of any responsibility: "We cast no blame on the district court for the error that occurred in this case." That's the federal judicial protection racket for you. Most traffic court judges would know better than to allow in testimony like this. Here is the opinion in United States v. Stanley Hill.

(wisenberg)

 

Update: Hat Tip to Steve Levin of Levin & Curlett LLC for pointing out that the case was tried by a CJA Panel Attorney rather than the Public Defender's Office.

April 29, 2014 in Judicial Opinions | Permalink | Comments (0) | TrackBack (0)