Friday, November 22, 2013
Catherine Martin Christopher has a new article titled, "Whack-a-Mole: Why Prosecuting Digital Currency Exchanges Won't Stop Online Laundering." The SSRN abstract states:
Law enforcement efforts to combat money laundering are increasingly misplaced. As money laundering and other underlying crimes shift into cyberspace, U.S. law enforcement focuses on prosecuting financial institutions’ regulatory violations to prevent crime, rather than going after criminals themselves. This article will describe current U.S. anti-money laundering laws, with particular criticism of how attenuated prosecution has become from crime. The article will then describe the use of Bitcoin as a money-laundering vehicle, and analyze the difficulties for law enforcement officials who attempt to choke off Bitcoin transactions in lieu of prosecuting underlying criminal activity. The article concludes with recommendations that law enforcement should look to digital currency exchangers not as criminals, but instead as partners in the effort to eradicate money laundering and — more importantly — the crimes underlying the laundering.
Thursday, November 14, 2013
Todd Haugh (Illinois Institute of Technology - Chicago-Kent College of Law) has a new forthcoming article in the Fordham Law Review - here. The SSRN Abstract states -
“So why did Mr. Gupta do it?” That question was at the heart of Judge Jed Rakoff’s recent sentencing of Rajat Gupta, a former Wall Street titan and the most high-profile insider trading defendant of the past 30 years. The answer, which the court actively sought by inquiring into Gupta’s psychological motivations, resulted in a two-year sentence, eight years less than the government requested. What was it that Judge Rakoff found in Gupta that warranted such a modest sentence? While it was ultimately unclear to the court exactly what motivated Gupta to commit such a “terrible breach of trust,” it is exceedingly clear that Judge Rakoff’s search for those motivations impacted the sentence imposed.
This search by judges sentencing white collar defendants — the search to understand the “why” motivating defendants’ actions — is what this article explores. When judges inquire into defendants’ motivations, they necessarily delve into the psychological justifications defendants employ to free themselves from the social norms they previously followed, thereby allowing themselves to engage in criminality. These “techniques of neutralization” are precursors to white collar crime, and they impact courts’ sentencing decisions. Yet the role of neutralizations in sentencing has been largely unexamined. This article rectifies that absence by drawing on established criminological theory and applying it to three recent high-profile white collar cases. Ultimately, this article concludes that judges’ search for the “why” of white collar crime,
which occurs primarily through the exploration of offender neutralizations, is legally and normatively justified. While there are potential drawbacks to judges conducting these inquiries, they are outweighed by the benefits of increased individualized sentencing and opportunities to disrupt the mechanisms that make white collar crime possible.
Wednesday, August 14, 2013
Call for Papers from the Notre Dame Jrl of Law, Ethics, and Public Policy -
The Notre Dame Journal of Law, Ethics & Public Policy is currently accepting articles and essays from professors, practitioners, and public officials for publication in its symposium issue, which will focus on the legal, moral, and ethical considerations of white-collar crime in the twenty-first century, which will be published early next year. Articles should be approximately 9,000 to 15,000 words and in Bluebook Citation format. Additionally, symposium authors will be among those selected to participate in our symposium event, which will be scheduled during the Spring 2014 semester.
The law student-edited Journal is unique among legal periodicals because it examines public policy and legal questions within the framework of the Judeo-Christian intellectual and moral tradition. The Journal has a national audience of persons actively involved in the formulation of public policy, and often includes timely pieces from a broad spectrum of prominent scholars and officials. The Journal’s unique focus is widely recognized, as demonstrated in citations to the Journal by various state and federal courts, including the United States Supreme Court. More information on the Journal is available at https://law.nd.edu/publications/journals/notre-dame-journal-of-law-ethics-public-policy/.
If you are interested in submitting a piece, please contact the Journal’s Executive Articles Editor, Angela Johnson at firstname.lastname@example.org or (574) 238-9225. Please submit by November 1, 2013. The Executive Board will consider submissions for publication immediately and would appreciate hearing of an author’s intent to submit as soon as possible.
Tuesday, June 25, 2013
Washington University Law School reports the passing of Kathleen F. Brickey here. The New York Times here called her " the dean of the field." She authored the first casebook in this area, wrote an incredible treatise on Corporate Criminal Liability, a book on Environmental Crimes and authored many articles in the white collar field. (see here). She served as the model professor and author for so many of us that came after her, entering a white collar scholarship world that was carved by her work. R.I.P.
Sunday, March 31, 2013
Maurice E. Stucke (University of Tennessee) authored an article titled, "Should Competition Policy Promote Happiness?" The SSRN abstract states:
What, if anything, are the implications of the happiness economics literature on competition policy? This Paper first examines whether competition policy should promote (or at least not impede) citizens’ opportunities to increase well-being. The Paper next surveys the happiness literature on five key issues: (i) What constitutes well-being; (ii) How do you measure well-being; (iii) What increases well-being; (iv) Do people want to be happy; and (v) Can and should the government promote total well-being? Although the happiness literature does not provide an analytical framework for analyzing routine antitrust issues, this does not mean that competition officials should discount or ignore the literature altogether.
The findings of the happiness literature, as this Paper argues, offer some helpful insights on the current debate over competition policy's goals. The literature suggests that competition policy in a post-industrial wealthy country would get more bang (in terms of increased well-being) in promoting economic, social and democratic values, rather than simply promoting a narrowly-defined consumer welfare objective.
Sunday, March 24, 2013
Daniel Sokol (UF & Minn) has a new piece titled, Policing the Firm. SSRN states:
Criminal price fixing cartels are a serious problem for consumers. Cartels are hard to both find and punish. Research into other kinds of corporate wrongdoing suggests that enforcers should pay increased attention to incentives within the firm to deter wrong-doing. Thus far, antitrust scholarship and policy have ignored this insight. This article suggests how to improve antitrust enforcement by focusing its efforts on changing the incentives of internal firm compliance.
Sunday, February 10, 2013
A recent publication in the Case Western Reserve Law Review by Dain C. Donelson and Robert A.
Prentice, Scienter Pleading and Rule 10b-5: Empirical Analysis and Behavioral Implications. From the abstract:
Pleading requirements are the keys to the courthouse. Nowhere is this more true than with rule 10b-5 class action securities fraud claims. Provisions of the Private Securities Litigation Reform Act of 1995 impose special pleading burdens upon plaintiffs regarding the scienter element and bar them from discovery when defendants file a motion to dismiss. This Article begins with a doctrinal history of the scienter element of a rule 10b-5 claim that indicates that many key legal questions remain unsettled and that application of legal rules to specific factual allegations regarding a particular type of defendant—external auditors—is extraordinarily muddled. To determine whether the impression arising from this extensive but nonsystematic examination of the case law is accurate, we also empirically examine rule 10b-5 claims against auditors and confirm that few facts are consistently viewed by the courts as indicating the presence (or absence) of scienter. This lack of clarity in the law and its application makes it difficult for either plaintiffs or defendants to evaluate the settlement value of claims. Furthermore, the law’s excessive vagueness affords judges virtually untrammeled discretion. The literature of behavioral psychology and related fields indicates that excessive discretion exacerbates problems that arise from unconscious judicial bias.
Thursday, February 7, 2013
Though extensive due process protections apply to the investigation of crimes, and to criminal trials, perhaps the most important part of the criminal process -- the decision whether to charge a defendant, and with what -- is almost entirely discretionary. Given the plethora of criminal laws and regulations in today's society, this due process gap allows prosecutors to charge almost anyone they take a deep interest in. This Essay discusses the problem in the context of recent prosecutorial controversies involving the cases of Aaron Swartz and David Gregory, and offers some suggested remedies, along with a callfor further discussion.
Monday, February 4, 2013
Announcement from the Fordham Law Moot Court Board
Each spring, Fordham University School of Law hosts the Irving R. Kaufman Memorial Securities Law Moot Court Competition. Held in honor of Chief Judge Kaufman, a Fordham Alumnus who served on the United States Court of Appeals for the Second Circuit, the Kaufman Competition has a rich tradition
of bringing together complex securities law issues, talented student advocates, and top legal minds.
This year’s Kaufman Competition will take place on March 22-24, 2013. The esteemed final round panel includes Judge Paul J. Kelly, Jr., of the Tenth Circuit; Judge Boyce F. Martin, Jr., of the Sixth Circuit; Judge Jane Richards Roth, of the Third Circuit; and Commissioner Troy A. Paredes, of
the United States Securities and Exchange Commission. The competition will focus on two issues that arise in the fallout of Ponzi schemes: whether the “stockbroker safe harbor” of the Bankruptcy Code applies to Ponzi scheme operators, and the application of SLUSA, which was recently granted cert by the Supreme Court.
We are currently soliciting practitioners and academics to judge oral argument rounds and grade competition briefs. No securities law experience is required to participate and CLE credit is available.
Information about the Kaufman Competition and an online Judge Registration Form is available on our website, www.law.fordham.edu/kaufman. Please contact Michael N. Fresco, Kaufman Editor, at KaufmanMC@law.fordham.edu or (561) 707-8328 with any questions.
Thursday, January 3, 2013
Thursday, December 27, 2012
Prosecutors often express mistrust of professional regulators, their rules and their processes. This may have been more understandable twenty years ago, when prosecutors perceived that the organized bar had been captured by defense lawyers seeking to use professional regulation as a means of imposing limits on criminal investigative authority that the law did not otherwise recognize. Although that criticism no longer has much basis in reality, it has persisted in the rhetoric prosecutors employ in advocacy regarding their professional conduct. This article explores prosecutors’ public attitude toward professional regulation, beginning with a brief account of their responses two decades ago, then considering three recent examples: the NDAA’s opposition to a broad reading of Model Rule 3.8(d)’s disclosure obligation; some prosecutors’ opposition to states’ adoption of the post-conviction obligations of Model Rules 3.8(g) and (h); and the Queens County, NY, district attorney’s opposition to a trial court’s consideration of the ethical propriety of his office’s post-arrest interrogation practices. The article argues that prosecutors’ anti-regulatory rhetoric undermines the culture of prosecutors’ offices and is contrary to the public interest in other ways.
Gabriel Markoff has a piece titled, Arthur Andersen and the Myth of the Corporate Death Penalty: Corporate Criminal Convictions in the Twenty-First Century that is forthcoming in the University of Pennsylvania Journal of Business Law, April 2013 issue. The SSRN abstract states:
The conventional wisdom states that prosecuting corporations can subject them to terrible collateral consequences that risk putting them out of business and causing massive social and economic harm. Under this viewpoint, which has come to dominate the literature following the demise of Arthur Andersen after that firm’s prosecution in the wake of the Enron scandal, even a criminal indictment can be a "corporate death penalty." The Department of Justice ("DOJ") has implicitly accepted this view by declining to prosecute many large companies in favor of using criminal settlements called deferred prosecution agreements, or "DPAs." Yet, there is no evidence to support the existence of the "Andersen Effect" and the much-hyped corporate death penalty. Indeed, no one has ever empirically studied what happens to companies after conviction. In this Article, I do just that. Using the database of organizational convictions made publicly available by Professor Brandon Garrett, I find that no publicly traded company failed because of a conviction in the years 2001–2010. Moreover, many convictions included plea agreements imposing compliance programs that advocates have pointed to as a key justification for using DPAs. Because corporate convictions do not have the terrible consequences they were assumed to have, and because they can be used to obtain compliance programs just as DPAs can, the DOJ should prosecute more lawbreaking companies and reserve DPAs for extraordinary circumstances. In the absence of some other justification for using DPAs, the DOJ should exploit the stronger deterrent value of corporate prosecution to its full capacity.
Wednesday, December 12, 2012
Gregory M. Gilchrist (Todelo) has a forthcoming article in Hastings Law Journal titled, "Condemnation Without Basis: An Expressive Failure of Corporate Prosecutions." The abstract describes it as:
This is the second of two articles on the expressive aspects of corporate criminal liability. The first article argued that to justify imposing criminal liability on corporations we must refer to the expressive function of criminal liability. This Article considers the expressive function of actual corporate prosecutions, and identifies aspects of corporate prosecutions that generate expressive costs rather than benefits. These are the expressive failures of corporate prosecutions. The article identifies a number of these failures and introduces a model of perceived legitimacy and the expressive function of punishment that explains how expressive failures harm the legal system. Mere respondeat superior liability – holding corporations criminally liable where there is no basis to condemn the corporate qua corporation – is the most significant expressive failure. It is also the easiest to fix: allow corporations a good faith defense against criminal liability. Good faith defenses have been proposed before, but this is the first proposal based on the expressive impact of the defense. A good faith defense will limit the application of corporate criminal liability to those instances where there is a basis to condemn the corporation as a whole, thus realigning the expression inherent in criminal punishment with commonly-held views about blaming corporations.
Friday, December 7, 2012
New Article - Unregulated Corporate Internal Investigations: Achieving Fairness for Corporate Constituents
Professor Bruce Green (Fordham) and I have a new article coming out in Boston Colleg Law Review, titled Unregulated Corporate Internal Investigations: Achieving Fairness for Corporate Constituents. You can download the article here. The SSRN abstract states:
This Article focuses on the relationship between corporations and their employee constituents in the context of corporate internal investigations, an unregulated multi-million dollar business. The classic approach provided in the 1981 Supreme Court opinion, Upjohn v. United States, is contrasted with the reality of modern-day internal investigations that may exploit individuals to achieve a corporate benefit with the government. Attorney-client privilege becomes an issue as corporate constituents perceive that corporate counsel is representing their interests, when in fact these internal investigators are obtaining information for the corporation to barter with the government. Legal precedent and ethics rules provide little relief to these corporate employees. This Article suggests that courts need to move beyond the Upjohn decision and recognize this new landscape. It advocates for corporate fair dealing and provides a multi-faceted approach to achieve this aim. Ultimately this Article considers how best to level the playing field between corporations and their employees in matters related to the corporate internal investigation.
New Article - Can the CEO Learn from the Condemned? The Application of Capital Mitigation Strategies to White Collar Cases
Todd Haugh has a forthcoming article in the American University Law Review titled, Can the CEO Learn from the Condemned? The Application of Capital Mitigation Strategies to White Collar Cases
. The Abstract states:
Ted Kaczynski and Bernie Madoff share much in common. Both are well-educated, extremely intelligent, charismatic figures. Both rose to the height of their chosen professions — mathematics and finance. And both will die in federal prison, Kaczynski for committing a twenty-year mail-bombing spree that killed three people and seriously injured dozens more, and Madoff for committing the largest Ponzi scheme in history, bilking thousands of people out of almost $65 billion. But that last similarity — Kaczynski’s and Madoff’s plight at sentencing — may not have had to be. While Kaczynski’s attorneys tirelessly investigated and argued every aspect of their client’s personal history, mental state, motivations, and sentencing options, Madoff’s attorneys offered almost nothing to mitigate his conduct, simply accepting his fate at sentencing. In the end, Kaczynski’s attorneys were able to convince the government, the court, and their client that a life sentence was appropriate despite that he committed one of the most heinous and well-publicized death penalty-eligible crimes in recent history. Madoff, on the other hand, with almost unlimited resources at his disposal, received effectively the same sentence — 150 years in prison — for a nonviolent economic offense. Why were these two ultimately given the same sentence? And what can Madoff, the financier with unimaginable wealth, learn from Kaczynski, the reclusive and remorseless killer, when it comes to federal sentencing?
The answer lies in how attorneys use sentencing mitigation strategies. This Article contends that federal white collar defendants have failed to effectively use mitigation strategies to lessen their sentences, resulting in unnecessarily long prison terms for nonviolent offenders committing financial crimes. The white collar defense bar has inexplicably ignored the mitigation techniques perfected by capital defense attorneys, and in the process has failed to effectively represent its clients. After discussing the development of the mitigation function in capital cases and paralleling it with the evolution of white collar sentencing jurisprudence, particularly post-Booker, this article will present seven key mitigation strategies currently used by capital defense teams and discuss how these strategies might be employed in federal white collar cases. The goal throughout this Article will be to highlight new strategies and techniques available in defending white collar clients and to enhance sentencing advocacy in federal criminal cases.
Sunday, November 4, 2012
T. Markus Funk, Perkins Coie Partner and former federal prosecutor, and Chicago Assistant U.S. Attorney Andrew S. Boutros examine the growing - but still largely under-recognized - international phenomenon of what Funk and Boutros term "carbon copy prosecutions." A country’s incentive to vindicate its own laws is not insubstantial, especially when a company or individual has already admitted, in a foreign proceeding, to having violated local law. With the increase in FCPA and money laundering cases, globalization presents many new concerns. Check out - Andrew S. Boutros & T. Markus Funk, "Carbon Copy" Prosecutions: A Growing Anticorruption Phenomenon in a Shrinking World
Maurice E. Stucke has a piece on SSRN titled, Is Competition Always Good? The abstract states:
Competition is the backbone of U.S. economic policy. The U.S. Supreme Court observed, "The heart of our national economic policy long has been faith in the value of competition." Competition advocacy is also thriving internationally. Promoting competition is broadly accepted as the best available tool for promoting consumer well-being. Competition officials, who regularly try to protect the public from anticompetitive special interest legislation, are justifiably jaded about complaints of excess competition. Although the economic crisis has prompted some policymakers to reconsider basic assumptions, the virtues of competition are not among them.
Nonetheless to effectively advocate competition, officials must understand when competition itself is the problem's cause, not its cure. Market competition, while harming some participants, often benefits society. But does competition always benefit society? This is antitrust’s blind spot. After outlining the virtues of competition, and discussing some well-accepted exceptions to competition law, this Article addresses four scenarios where competition yields a suboptimal result.
Saturday, July 21, 2012
By - Lucian Dervan & Markus Rubenstahl - available here
Abstract: Written for a European publication focusing on internal investigations, this piece seeks to introduce the reader to the fundamental elements of the American FCPA, including discussion of available defenses under the statute. Further, this piece discusses some of the collateral considerations that must be made during the investigation of an FCPA matter, particularly given the existence of overlapping anti-bribery provisions in various countries throughout the world and the likelihood of concurrent parallel proceedings both in the United States and abroad during the pendency of any international bribery matter. Finally, this piece offers some thoughts regarding FCPA compliance programs.
Friday, July 6, 2012
Check out Daniel D. Sokol's new article titled, Cartels, Corporate Compliance and What Practitioners Really Think About Enforcement available here and to be appearing in the Antitrust L.J.
The SSRN abstract states:
This article shows the limitations to the optimal deterrence-inspired cartel enforcement policy currently used by the Department of Justice Antitrust Division. This article employs both quantitative and qualitative survey evidence of cartel practitioners to shed light upon the realities of US cartel enforcement policy. The empirical evidence provided by the practitioner surveys challenges the traditional assumptions behind the success of the DOJ’s cartel program. Perhaps the most interesting finding is that firms regularly game the leniency program to punish their competitors. For various reasons, firms and the DOJ have strong incentives to settle rather than to litigate cases in which the legality of cartel conduct may be in doubt. The surveys also expose limitations to the optimal deterrence framework for firms and individuals regarding incentives and behavior. These findings suggest the need for an enforcement focus on sub-units within the firm as well as various processes to change behavior that would improve enforcement and deterrence. Finally, the surveys suggest certain structural limitations in organizational behavior within firms that have prevented antitrust compliance programs from becoming embedded in a way that would reduce cartel activity. Additionally, this article provides an analysis of media coverage of cartel enforcement from 1990-2009. The analysis suggests that successful enforcement has not created sufficient awareness of cartel behavior among the public. Relative to other types of financial crimes, such as accounting fraud, the public seems unaware or uninterested in cartel activity. The conclusion summarizes the article’s findings and outlines potential future steps in cartel research."
Sunday, April 22, 2012
Check out this new article by Mike Koehler here. His abstract states:
"Bringing criminal charges and marshalling the full resources of law enforcement agencies against an individual is an awesome power that our government possess. Because that power alters the lives of real people and their families, sidetracks real careers, empties real bank accounts in mounting a defense, and causes often irreversible damage to real reputations, it ought to be exercised with real discipline and prudence.
While it is unrealistic (and probably not desirable from a policy perspective) to expect the Justice Department to win 100 percent of its Foreign Corrupt Practices Act prosecutions against individuals when put to its burden of proof, given the above referenced dynamics, it is realistic (and desirable from a policy perspective) to expect the department to win a very high percentage of its FCPA prosecution against individuals. However, several recent DOJ FCPA prosecutions against individuals have fallen short of this desirable objective, often in spectacular ways. This raises the question - what percentage of DOJ FCPA losses is acceptable?
To borrow from Justice Potter Stewart's classic reasoning in Jacobellis v. Ohio, I don't know what level of DOJ FCPA losses is acceptable and the answer may be indefinable. But I know it when I see it, and the number and magnitude of DOJ's recent FCPA losses is unacceptable."