Publications

11.26.19 | Blog Posts

Intimidation or Free Speech: Are Trump’s Tweets Witness Tampering?

The Insider: White Collar Defense and Securities Enforcement

President Trump’s use of Twitter to shape the narrative is notorious. True to form, he was tweeting fast and furious during the impeachment hearings. Negative testimony about the president’s interactions with Ukrainian leader Volodymyr Zelensky repeatedly incited his aggressive retorts, prompting speculation about whether his outbursts may be viewed as witness intimidation. Citing the First Amendment, Trump claims he is free to say what he pleases, including name-calling and denigrating witnesses. But is it criminal witness intimidation? [...]

Related Lawyer: Robert J. Anello

11.04.19 | Blog Posts

The Minuses of Bringing a Plus One to Meetings with Counsel

The Insider: White Collar Defense and Securities Enforcement

It’s a privilege to have a close family, but the presence of family members for conversations with counsel can waive privilege. Nowhere does this create more of a potential problem than in criminal prosecutions. In such cases, it is not uncommon for a client to want a spouse, parent, or even child on hand at counsel’s office to discuss, for example, general strategy, the risks of going to trial, or plea options. The desire to include family members in these conversations makes sense, because the choices an individual makes in a criminal matter can have wide-ranging consequences for loved ones. But including family members in conversations with counsel creates the risk that the conversation will not be treated as confidential, and that one of those family members could be called to testify to the contents of the conversation. It is important that counsel, clients, and family members alike understand those risks and how to minimize them. [...]

Related Lawyer: Brian A. Jacobs

10.18.19 | Blog Posts

Tax Gap Estimates Show That Compliance Rates Remain Unchanged

The Insider: White Collar Defense and Securities Enforcement

With the passing of the October 15 deadline for filing individual income tax returns on extension, the extent to which taxpayers voluntarily comply with their tax obligations is top of mind for many tax professionals and observers. For people concerned with such things, the Internal Revenue Service periodically issues reports measuring voluntary compliance with the tax laws by computing the so-called “tax gap”, which purports to represent the difference between taxes that are owed and taxes that are paid. [...]

Related Lawyer: Jeremy H. Temkin

09.22.19 | Blog Posts

Trump's Efforts to Quash Manhattan DA's Tax Subpoena: A Tortured Version of the Rule of Law

The Insider: White Collar Defense and Securities Enforcement

In January 2016, President Trump publicly announced that he would “absolutely” release his tax returns. Since that proclamation, Trump consistently has fought efforts to disclose those same returns. Continuing that trend, Trump has filed a federal complaint to enjoin a subpoena from Manhattan prosecutors that required Trump’s accountant to produce his tax returns. Through his lawsuit, Trump has staked out an unreasonably broad conception of presidential immunity that finds no support in the law—and contorts “policy” beyond recognition. Indeed, read literally, it could unreasonably suggest that even a President’s coconspirators could not be investigated, if to do so would touch on information about the President. [...]

Related Lawyer: Robert J. Anello

09.18.19 | Blog Posts

Employee Liability for Corporate Misconduct – Elizabeth Warren Style: Can Negligence Become Criminal?

The Insider: White Collar Defense and Securities Enforcement

Since the last financial crisis and the resulting increased scrutiny on business entities, companies involved in suspected corporate misconduct repeatedly have paid massive fines to resolve criminal charges. Alongside high-profile announcements by the government of multi-million- and billion-dollar recoveries has been a near constant refrain from politicians and commentators that prosecutors have been lax in pursuing individuals in connection with large corporate malfeasance. [...]

Related Lawyer: Robert J. Anello

08.14.19 | Blog Posts

All Defendants Are Created Equal Under The Bail Reform Act – or Are They?

The Insider: White Collar Defense and Securities Enforcement

On August 1, 2019, the Second Circuit Court of Appeals jumped into the fray of what has been a growing debate about the right under the federal Bail Reform Act for individuals facing indictment to create conditions for release that only the wealthiest of defendants can even contemplate, including paying for their own home detention service. In a highly unusual opinion, in the case of United States v. Boustani, the Circuit held that the Bail Reform Act “does not permit a two-tiered bail system in which defendants of lesser means are detained pending trial while wealthy defendants are released to self-funded private jails.” Although the Second Circuit’s “all created equal” pronouncement may be laudable, it is inconsistent with the plain meaning of the Act and unnecessary given the facts of Boustani. As I explain in my prior blog post, “Too Rich to Bail?,” the Bail Reform Act requires that, in each case, courts conduct an individualized assessment of the charges against the defendant as well as the weight of the evidence and the defendant’s underlying history and circumstances, to determine whether any conditions exist that would assure the defendant’s appearance in court. Thus, the Act is inequitable by its very terms. This blog discusses the Circuit’s Boustani opinion and whether the Circuit, in reaching the issue of equitable treatment, misconstrued the Act’s text. [...]

Related Lawyer: Catherine M. Foti

08.06.19 | Blog Posts

The Tax Man Taps the Brakes on Digital Currency Expansion

The Insider: White Collar Defense and Securities Enforcement

In June 2019, Facebook and a consortium of 28 founding members including Visa, Mastercard, PayPal, Uber Technologies, Inc., and eBay announced the launch in 2020 of a new digital currency called Libra, promoted as “a simple global currency and financial infrastructure that empowers billions of people.” In a White Paper introducing Libra, the consortium promises accessibility to the 1.7 billion adults globally who remain outside the financial system but who have access to mobile phones and the internet and pledges trustworthiness and support for “collaborating and innovating with the financial sector, including regulators.” Yet Libra’s global reach and potential for misuse has alarmed U.S. regulators and central bankers worldwide. At a July 11, 2019 Senate Banking Committee hearing, Federal Reserve Chair Jerome Powell expressed concern that no single regulator currently has authority to oversee Libra, stating that “Libra raises a lot of serious concerns, . . . [including] privacy, money laundering, consumer protection, [and] financial stability.” Treasury Secretary Steven Mnuchin, in a White House press briefing on July 15, 2019, acknowledged the great interest in Libra and other cryptocurrencies but voiced Treasury’s serious concern “regarding the growing misuse of virtual currencies by money launderers, terrorist financiers, and other bad players.” Concerns have also been articulated by private citizens. In an Opinion piece published by the Financial Times on June 21, 2019, Facebook co-founder Chris Hughes warned that Libra will permit companies that will put their private interests ahead of public ones to exercise monetary control and will “disrupt and weaken nation states by enabling people to move out of unstable local currencies and into a currency denominated in dollars and euros and managed by corporations.” [...]

Related Lawyer: Jeremy H. Temkin

07.19.19 | Blog Posts

The Vanishing of Federal Sentencing Decisions

The Insider: White Collar Defense and Securities Enforcement

In civil cases, the most important decisions that federal district judges make typically are recorded in the form of written opinions that are collected in the Federal Supplement, widely available for free online, and available in searchable databases on Westlaw and LexisNexis, among other places. In criminal cases, by contrast, some of the most important decisions that federal district judges make—regarding what sentences to impose—are, in the vast majority of cases, lost in the ether of PACER, where they are available only to those who know precisely where to look. This state of affairs is far from ideal for prosecutors, defense attorneys, and district judges, and it is patently unfair for criminal defendants themselves. [...]

Related Lawyer: Brian A. Jacobs

06.05.19 | Blog Posts

Insiders Report on the State of the IRS

The Insider: White Collar Defense and Securities Enforcement

On May 28, the Commissioner of the Small Business/Self-Employed (“SB/SE”) Division, the National Taxpayer Advocate (“NTA”) and the Chief of IRS Criminal Investigation (“CI”) provided their insider perspectives on the current state of the IRS at a town hall held at the New York City Bar Association. Each of these executives gave insights into the challenges facing the Service. [...]

Related Lawyer: Jeremy H. Temkin

05.22.19 | Blog Posts

How Many Company Employees Can Fit Into a White-Collar Lawyer's Pool?

The Insider: White Collar Defense and Securities Enforcement

State and federal prosecutors often are suspicious and critical of efforts by a company under criminal investigation to control costs and centralize knowledge by establishing “pool counsel” to represent employees who may be called upon to be witnesses. As a result, government attorneys frequently attempt to dissuade potential witnesses (current/former employees, officers, or agents of the subject organization) from agreeing to be represented by an attorney hired by their company to concurrently represent a group of similarly situated individuals. A recent ethics opinion issued by the Committee on Professional Ethics of the Association of the Bar of the City of New York, chaired by renowned ethics expert Professor Bruce Green, makes clear that although pool counsel must evaluate a number of ethical considerations, such representation often is reasonable, practical, and desirable. Hopefully, at least in New York, the Committee’s thoughtful and insightful analysis will allay prosecutors’ undue concerns. [...]

Related Lawyer: Robert J. Anello

05.15.19 | Blog Posts

The Proper Treatment of Fraud Victims in Federal White Collar Prosecutions

The Insider: White Collar Defense and Securities Enforcement

In white collar cases, federal prosecutors around the country reflexively file—and district courts routinely grant—motions seeking to bar defense counsel from making arguments, introducing evidence, or pursuing cross-examination regarding a fraud victim’s carelessness in dealing with the defendant. Any such argument or evidence, prosecutors generally argue, should be precluded as irrelevant, under Rule 401 of the Federal Rules of Evidence, on the ground that a victim’s lack of caution and diligence is no defense to fraud. Although these motions find support in well-established precedent, there are several reasons why courts should view them with a bit of skepticism, and should give defense counsel more latitude in exploring, particularly through cross-examination, the behavior of fraud victims. [...]

Related Lawyer: Brian A. Jacobs

05.13.19 | Blog Posts

Will the Rise of Originalism Spell the End of Gay Rights Under Title VII?

The Insider: White Collar Defense and Securities Enforcement

With the arrival of Justices Neil Gorsuch and Brett Kavanaugh to the Supreme Court, almost half of the justices now subscribe to originalism—the view that vague constitutional provisions mean what they were originally understood to mean when they were enacted. While originalism figures prominently in debates about constitutional interpretation (for example, originalists claim that Roe v. Wade must be wrong because nobody alive in 1791 believed the Bill of Rights protected the right to have an abortion), originalism is seldom discussed in the context of statutory interpretation. That will likely change in the upcoming Supreme Court term, as the Court agreed on April 22 to review the Second Circuit’s en banc decision in Zarda v. Altitude Express—a decidedly non-originalist decision. In Zarda, notwithstanding that no one thought Title VII prohibited discrimination based on sexual orientation when the law passed in 1964, the Second Circuit held that Title VII prohibits just such discrimination. [...]

Related Lawyer: Catherine M. Foti

04.23.19 | Blog Posts

Top 10 Crimes Mueller’s Report Considers

The Insider: White Collar Defense and Securities Enforcement

The long-awaited Mueller Report provides a detailed picture of the wide variety of crimes investigated by the Special Counsel’s Office, many of which resulted in indictments or guilty pleas, and, in the case of President Trump, a suggestion that Congress may review the legality of obstructive acts. Although Mueller declined to make a final determination regarding President Trump’s criminal liability, contrary to assertions from the administration, the investigation did not exonerate Trump. Instead, the report identified multiple instances of what may be considered obstructive conduct by the President. Citing limitations on its role as an arm of the Justice Department, the Special Counsel’s Office referred determination of the question of whether Trump obstructed justice to Congress. [...]

Related Lawyer: Robert J. Anello

03.06.19 | Blog Posts

From Teapot Dome to Trump: How Congress Investigates Criminal Scandals

The Insider: White Collar Defense and Securities Enforcement

Since the House passed a resolution in 1792 to investigate the defeat of the United States Army at the hands of American Indians in Ohio (known as St. Clair’s Defeat), Congress has investigated hundreds of instances of possible misconduct by members of the executive branch. Today’s news is rife with reports of congressional investigations into potential obstruction of justice and more serious substantive crimes by President Trump and his immediate circle. Inevitably, the paths of congressional and criminal investigations into this type of misconduct overlap. History shows that this intersection can be fruitful, frustrating, and fraught with pitfalls. [...]

Related Lawyer: Robert J. Anello

02.20.19 | Blog Posts

Too Rich To Bail?

The Insider: White Collar Defense and Securities Enforcement

Recently, a federal judge in Brooklyn questioned whether the Bail Reform Act permits “disparate treatment based on wealth,” and denied bail to a high-net worth defendant who proposed a package that included home detention secured by privately-funded guards. In United States v. Boustani, U.S. District Judge William F. Kuntz II rejected the bail package proposed by Jean Boustani, an international businessman at the center of a $2 billion alleged fraud, bribery, and money laundering scheme that the government claims caused “staggering” losses to foreign and American investors and “devastated” the economy of Mozambique. In addition to what courts have called the “private prison” concept, Boustani’s proposed bail package included a $20 million personal recognizance bond secured by $1 million cash, and the surrender of travel documents by Boustani and his wife. [...]

Related Lawyer: Catherine M. Foti

02.15.19 | Blog Posts

Peremptories And Prejudice: The Striking Role Of Employment Status In Jury Selection

The Insider: White Collar Defense and Securities Enforcement

It is a truth universally acknowledged, that a trial lawyer in possession of limited information about prospective jurors, may exercise strikes based on a juror’s employment status. Criminal prosecutors may strike jurors who are unemployed, in the belief that such jurors may be less socially connected, less accustomed to following rules, less experienced in making serious decisions (such as voting for conviction), and thereby potentially biased against the government and in favor of the defendant. Criminal defense lawyers, meanwhile, may strike jurors who are employed, for the inverse reasons. And in civil cases, as one commentator wrote, “[j]ury consultants consistently report that,” among other things, “long-term, unemployed people . . . tend to favor the plaintiff’s position.” Employment status can be an entirely reasonable reason for a trial lawyer to strike a prospective juror. At the same time, however, employment status can at times be misused by trial lawyers as a pretext to strike a juror when the real reason is the juror’s membership in a so-called cognizable group, such as a racial minority. In order to distinguish between a permissible and impermissible strike, judges should engage in extraordinarily careful fact-finding and analysis, as the stakes for both the lawyers and the parties run high. [...]

Related Lawyer: Brian A. Jacobs

01.23.19 | Blog Posts

The Harmless Error Standard on a Silver Platter

The Insider: White Collar Defense and Securities Enforcement

In United States v. Stewart, in a 2-1 decision, the Second Circuit vacated defendant Sean Stewart’s insider-trading conviction, holding that the district court erroneously excluded a key piece of impeachment evidence and that this error could not be excused as harmless. Although the opinion focused on the admissibility of evidence that impeaches hearsay statements, the majority’s defense-friendly application of the harmless error standard could have a greater impact in future criminal appeals. [...]

Related Lawyer: Brian A. Jacobs

12.19.18 | Blog Posts

Naughty or Nice: Is Trump's Hint of a Gift of a Pardon to Manafort Obstruction of Justice?

The Insider: White Collar Defense and Securities Enforcement

According to various media reports, President Trump’s Christmas list may include the gift of a pardon to his former campaign chairman, Paul Manafort. Many critics claim that the mere suggestion of a pardon to Manafort amounts to an obstruction of justice. The law on whether and when the nation’s chief law enforcer can be said to engage in obstruction is unsettled, although what is clear is that the president’s constitutional authority is not limitless. Other presidents have exercised their absolute power to pardon in questionable ways, but the question on everyone’s mind lately is whether Trump’s dangle of a pardon to Manafort, as distinguished from the act of pardoning, may constitute an obstructionist act. [...]

Related Lawyer: Robert J. Anello

10.15.18 | Blog Posts

Rethinking Corporate Monitors: DOJ Tells Companies to Mind Their Own Business

The Insider: White Collar Defense and Securities Enforcement

Since about the early 2000s, corporate monitors have become a go-to weapon for the Justice Department in its battle against business crime. Imposition of such monitors often results in the disruption of companies’ activities and expenditures of millions of corporate dollars – that might otherwise go to benefit shareholders. In line with its more business-friendly approach, Attorney General Jeff Sessions’ Department of Justice has signaled a retreat from such intrusion on businesses’ operations. Last Friday, Brian A. Benczkowski, the Assistant Attorney General in charge of the Justice Department’s Criminal Division, delivered a speech at New York University School of Law revealing this change in the Department’s approach to the use of corporate monitors. [...]

Related Lawyer: Robert J. Anello

09.26.18 | Blog Posts

Corporate Health Care Fraud Prosecutions in the Trump Administration: It Ain’t Over Til It’s Over

The Insider: White Collar Defense and Securities Enforcement

As we near the two-year point since the election of Donald J. Trump to the White House, the topic of white collar crime continues to dominate the public conversation – but the conversation in fact consists of two distinctly separate streams of dialogue. The first, and plainly more prominent, relates to the conduct of the Trump administration itself. The Special Counsel investigation regarding Russian intervention in the 2016 election, the prosecution of Michael Cohen for violating campaign finance laws, Paul Manafort’s decision to cooperate with the Special Counsel following his trial conviction on counts of bank fraud and tax fraud, and the investigation of President Trump for a host of potential crimes – all of these matters have rightfully earned headlines and generated tremendous public attention. But a second stream of dialogue, while less present in the mainstream media, is nonetheless of significant importance as well. Indeed, it is this second topic – namely, how aggressively the Trump Administration’s Department of Justice will pursue investigations into white collar crime in general, and health care fraud in particular – that is understandably a subject of much import to the corporations and individuals whose conduct may be the focus of government scrutiny. [...]

Related Lawyer: Robert M. Radick


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