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Doing Even More With Relatively Less - 04.02.2020
Over the past decade, the IRS suffered a series of deep budget cuts that, by 2018, left the agency with fewer agents conducting audits and criminal investigations than it had 20 years earlier. The budget cuts also resulted in fewer employees responding to taxpayer inquiries and fewer representatives in the Office of the Taxpayer Advocate helping taxpayers resolve issues with the IRS. Notwithstanding the severe budget cuts, Congress expected the IRS to maintain its civil and criminal enforcement programs, provide resources to the vast majority of taxpayers who strive to comply with their tax obligations and implement key provisions of the Affordable Care Act, the Tax Cuts and Jobs Act and the Taxpayer First Act. [...]
In just a few weeks COVID-19 has stopped most businesses in the United States in their tracks. The business of fraud, however, respects no boundaries and thrives in times of crisis. Understanding this to be the case, both federal and state law enforcement already have stepped up their responses to such schemes. [...]
Just as the COVID-19 pandemic has devastated public and private life with alarming speed – with forced social distancing, widespread layoffs, stock market turmoil, and the nightmare scenario of hospitals being overrun – so too has it had a massive and tumultuous effect on the criminal justice system. Indeed, just as the elderly and those with underlying health conditions are particularly vulnerable to COVID-19 and its effects, so are those who have the extreme misfortune (whether through their own actions or otherwise) of finding themselves in the criminal justice system as the virus races through all corners of America, including its jails, prisons, and potentially its courthouses as well. [...]
In 2010, the U.S. Supreme Court held that competent criminal defense lawyers must advise their clients of the immigration consequences of pleading guilty in order to provide “reasonable professional assistance.” Two years later, in Kawashima v. Holder, the Supreme Court held that offenses relating to the preparation and filing of false tax returns constitute aggravated felonies that can serve as a predicate for deportation. In this article, I analyze recent decisions by several Circuit Courts of Appeals applying Kawashima’s reasoning not just to defendants convicted of making false statements on tax returns, but to other white-collar offenders as well, and question whether immigration considerations will make it more difficult to achieve pretrial dispositions in false statement cases.
On Wednesday, March 11, 2020, partner Jonathan S. Sack will moderate a panel entitled, “Compliance, Cooperation, and Monitorships: Current DOJ Policy” at the American Bar Association’s 34th Annual National Institute on White Collar Crime. The panel will focus on the framework for evaluating the effectiveness of compliance programs set out in the DOJ Manual and DOJ leadership pronouncements, as well as recent adjustments. It will also consider the impact on compliance programs, cooperation, and the need for monitorships. The event will take place in San Diego at the Marriott Marquis.
For more information about this program, please click here.
A Good Sentencing Precedent is Hard to Find - 03.11.2020
In the February 2020 issue of the Federal Sentencing Reporter, Vol. 32, No. 3, pp. 138-144, Morvillo Abramowitz partner Brian A. Jacobs expands upon a prior column he wrote (available here) and discusses in depth the role sentencing precedent has played in recent federal sentencing proceedings, with a particular focus on cases involving gambling addictions and college admissions and testing fraud. Notwithstanding the key role sentencing precedent can play, courts and parties still face significant challenges in finding applicable sentencing precedents, and the article ultimately explores ways in which the body of sentencing law could be made more readily available to parties and courts alike.
Criminal fraud charges are often described very broadly, without identifying the specific misstatements central to the case. A bill of particulars is an important tool to help prepare a defense and minimize surprise at trial. In this article, we discuss the standard for granting a bill of particulars, and analyze a recent decision which ordered particulars in the high-profile prosecution growing out of the Theranos blood-testing scandal. We hope you find the article of interest.
On February 20, 2020, Morvillo Abramowitz partner Jeremy H. Temkin was quoted in a Bloomberg article entitled, “Roger Stone Gets Over Three Years in Jail for Trump Cover-Up.”
To read the article and review Jeremy's comments, please click here.
More than 500 years ago, English courts developed a common law privilege, which was incorporated into American law in the early years of the republic, protecting against civil arrests of parties and witnesses on courthouse premises and when traveling to or from court. Recently, the U.S. Immigration and Customs Enforcement agency (ICE) has taken action contrary to this privilege by engaging in courthouse civil arrests of undocumented and other aliens. The State of New York and Kings County District Attorney have brought suit to stop this practice. In this article, we analyze Southern District Judge Jed S. Rakoff’s recent decision denying ICE’s motion to dismiss the lawsuit and concluding that although ICE enjoys broad discretion in enforcing the nation’s immigration laws, its discretion is not unlimited, with one powerful such limit potentially being the common law privilege against courthouse civil arrests.
For more than a decade the Internal Revenue Service has devoted substantial resources to pursuing individuals who use offshore vehicles to cheat on their U.S. tax obligations, as well as banks and professionals that facilitate their misconduct. As the IRS has struggled to tackle the challenges presented by foreign bank secrecy, the introduction of virtual currencies and the increasingly global nature of the economy have complicated its enforcement efforts. [...]
On Monday the career prosecutors who handled the trial of the president’s friend and former campaign advisor, Roger Stone, recommended that the court sentence Stone, convicted in November of obstructing Congress and witness tampering, to 87 – 108 months in federal prison, the sentence called for by the federal sentencing guidelines. Less than twenty-four hours later, at 1:48 a.m., President Trump weighed in with a tweet about the recommendation: “This is a horrible and very unfair situation. The real crimes were on the other side, as nothing happens to them. Cannot allow this miscarriage of justice!” Putting aside, for a moment, the fact that the party on the “other side” in Mr. Stone’s case is none other than our own United States of America, with this tweet, the president attempted to put both thumbs on the scale in the criminal prosecution of his friend. What he missed unfortunately was the opportunity to focus legislators properly on the sometimes unduly harsh results of the sentencing guidelines in white collar cases. [...]
One of the key tools that white-collar attorneys regularly use to engage with prosecutors – the attorney proffer – often proceeds without any express agreement regarding what ground rules apply. In this article, we discuss the law around attorney proffers, highlight special considerations for corporate clients, and conclude that ample support exists for the longstanding custom and practice of using a careful attorney proffer as a means for necessary “frank discussion between defense counsel and prosecutor” without undue risk to either side.
In 2017, the SEC brought an insider trading action against an individual named Todd Alpert in the Southern District of New York for breaching a duty by misappropriating information used to trade securities. The case raised an interesting issue: What kind of duty did Alpert breach? Insider trading narratives have traditionally turned on breaches of fiduciary duties – but was a fiduciary duty required? In this article, I discuss the impact of Alpert, highlight the Second Circuit cases grappling with whether a simple contract is sufficient to create a duty to refrain from insider trading, and conclude that absent new legislation we will have to look to forthcoming decisions for guidance on what kind of promises are sufficient to create duties under the Exchange Act.
Morvillo Abramowitz Partner Brian A. Jacobs was cited in a petition for rehearing en banc before the United States Court of Appeals for the Second Circuit in connection with a recent blog he published in Forbes.com. The blog engaged in a close reading of an important sentence from the Second Circuit’s recent split decision in United States v. Blaszczak, and assessed whether that sentence accurately interprets the Supreme Court’s decision in Dirks v. SEC.
To read Brian’s full blog, please click here.
To read the petition, please click here.