Bankruptcy Fraud in the Spotlight?
March 29, 2005
As we all know, the feds continue to investigate and prosecute fraud in the financing, accounting and operation of businesses. The Second Year Report of the President's Corporate Fraud Task Force declares that over 500 corporate fraud convictions have been obtained to date and that charges have been brought against over 60 corporate CEOs or presidents. However, executives and their counselors would do well to note that the government's will and ability to prosecute high-level management may not lessen just because a business is in extremis.
Written vs. Oral Joint-Defense Agreements
March 29, 2005
The Joint-Defense Agreement (JDA) has become a fixture in complex white-collar cases and even many purely civil actions. When the government begins an investigation of a company and its employees, it is often advisable and sometimes necessary to secure separate representation for the company, its employees and perhaps other entities or individuals. Independent attorneys owe a duty of loyalty to their individual clients and can provide them with personalized, confidential legal advice that an attorney for the company cannot provide. The company, however, needs to communicate with these represented parties. Employees will speak frankly with company counsel only if they know they are not exposing themselves to prosecution. A company cannot produce documents and engage in frank conversation with the government without such employee cooperation.
Money Laundering Compliance Examinations
March 29, 2005
The biggest change that financial institutions face is the new, expanded-scope anti-money laundering (AML) regulatory examination and the proliferation of Written Agreements, Memoranda of Understanding, or Cease and Desist Orders issued by bank regulatory agencies should the financial institution be found to be deficient. An analysis of recent regulatory orders including, among others, AmSouth, ABN AMRO, Standard Chartered, Hudson United Bank, and City National Bank, demonstrates that the regulators are focused on multiple issues.
Failing to Report Suspicious Activity
February 24, 2005
Recent criminal investigations of banks show that prosecutors are increasingly taking a hard look at financial institutions that allow themselves to be used by wrongdoers, from scam artists to terrorists. Banks, and myriad other entities deemed "financial institutions" under federal law, have an obligation to report suspicious activity to law enforcement. In what some consider a dramatic change in policy, prosecutors are increasingly willing to investigate and prosecute financial institutions for failing to meet this obligation -- even where the institution did not participate in the wrongdoing.
Supreme Court Gives the Defense a Boost in Plea Bargaining
February 24, 2005
The Supreme Court's Jan.12 decision in <i>U.S. v. Booker</i>, which made the federal Sentencing Guidelines advisory rather than mandatory, is likely to: 1) prove modest in its impact on sentences in the short run; 2) alter a bit the balance of power among prosecutors, defense attorneys and judges; and 3) spur Congress to make federal sentencing even more Draconian than it was for 2 decades under the mandatory Guidelines.
The TAP Pharmaceutical Acquittals
February 24, 2005
In 2001, the U.S. Attorney in Boston charged TAP Pharmaceutical Products Inc. (TAP) with conspiring to provide urologists with thousands of free samples of Lupron', for which the doctors billed Medicare and their patients. In order to survive and continue selling its blockbuster product for advanced prostate cancer, TAP made a reasoned decision to pay the government $885 million to resolve both civil and criminal charges. With this resolution, Boston's talented federal prosecutors continued their remarkable success in bringing major pharmaceuticals to their knees and reaching landmark settlements.
In The Courts
February 24, 2005
Recent rulings of importance to you and your practice.
