Recent Posts
Follow Us
twittergoogle_pluslinkedinrssyoutube
The Legal Stuff
Government Enforcement Exposed - "The GEE"
0 0

21 Mar 2017 The Yates Memo – DOJ Issues Questions and Answers: Question 2

  *This is the third in a series of blog posts that examines seven FAQs issued by the DOJ in an effort to clarify certain aspects of its Individual Accountability Policy—as articulated in the “Yates Memo.” The second of these questions concerns what a company is required to do to earn cooperation credit.   Question: What else, in addition to providing the DOJ with all non-privileged relevant information about individuals involved in misconduct, is a company required to do to earn cooperation credit?   Answer: The United States Attorneys’ Manual (“USAM”) identifies several factors that will be considered by the Department of Justice to determine the level of cooperation credit a company will receive. In short, the level of cooperation credit the DOJ will bestow directly correlates with…

READ MORE
0 0

23 Mar 2016 A New Approach: DOJ Antitrust Division in Wake of Yates Memo

  For more than five years, the Department of Justice’s (DOJ) Antitrust Division and the FBI have had the automotive parts industry under a microscope. In September 2015, the DOJ announced it would undertake a policy shift to focus more ardently on the investigation and prosecution of individuals responsible for company misconduct. This new policy shift may already be influencing the manner in which the Antitrust Division is conducting criminal investigations.   The ongoing federal investigation into price fixing, bid rigging, and other anticompetitive conduct has netted at least 38 corporate convictions, 58 indictments of corporate executives, and approximately $2.6 billion in criminal fines. Most recently, INOAC Corp., an auto parts supplier and major player in the advanced materials industry, pled guilty for conspiring to…

READ MORE
0 0

23 Nov 2015 Federal Prisoner Release: The First Step of a More Ambitious Plan

The Federal Bureau of Prisons has caused quite a stir recently due to its anticipated early release of an approximately 6,000 prisoners convicted of drug possession and/or drug trafficking crimes. Much of the debate between opponents and advocates of the mass release has focused on its impact on public safety. Yet, many of its critics are completely unaware of the fact that these events were set in motion more than a year ago, when the U.S. Sentencing Commission unanimously voted to amend the federal sentencing guidelines with respect to drug offenses. What may be even more troubling to critics of the Bureau and Commission’s actions is that this is likely only the first step toward a more ambitious reform – the elimination of mandatory minimum…

READ MORE
0 0

12 Aug 2015 What the DOJ Expects of ‘Effective’ Compliance Programs

If you have been keeping up with current U.S. Department of Justice (DOJ) antitrust investigations, you have no doubt noticed the hefty criminal fines that have been paid by violators of U.S. antitrust laws. In recent years, the United States government has literally collected billions of dollars in criminal fines. In light of the staggering fines, one important factor that antitrust practitioners should consider is the DOJ’s evaluation of a company’s compliance and ethics program. In theory, a company that pleads guilty to antitrust violations may be afforded a reduction in its culpability score if it can demonstrate that there was a compliance and ethics program in place at the time of the violation, and that the program was “effective” as defined by the U.S….

READ MORE
0 0

05 May 2015 Extradition from Japan: The Gamble

It is no secret amongst criminal antitrust practitioners that the U.S. Department of Justice (DOJ) has had difficulty extraditing foreign nationals indicted for Sherman Act violations.  Indeed, the extradition process is complex and uncertain given the multitude of hurdles the DOJ faces when attempting to extradite a citizen of a sovereign country.   Japanese nationals are no exception. The reality is that Japanese law and extradition proceedings afford the Japanese government a huge amount of discretion as to whether or not to comply with an extradition request made by the United States government.  Interestingly, despite the nearly insurmountable challenges faced by the DOJ in extradition proceedings, a surprising number of Japanese executives and employees have acquiesced to the U.S. justice system, the result of which…

READ MORE
0 0

22 Jan 2015 Chasing the Gatekeepers

In an earlier post on our Government Enforcement Exposed blog, we highlighted the Securities and Exchange Commission’s anticipated focus on cracking down on those they have referred to as “gatekeepers” – attorneys, auditors, accountants, compliance officers, and the like. As pointed out in our prior post, SEC Commissioners have stated in public speeches that they intended on using new rules and novel approaches to prosecute all responsible individuals involved in facilitating a securities violation.[i]   True to its word, the SEC recently announced that it was instituting administrative proceedings alleging fraud against an attorney and seven auditors for their peripheral role in an attempt by a Canadian-based attorney, John Briner, to effectuate a microcap pump-and-dump scheme. The recent charges stem from a stop order proceeding…

READ MORE
0 0

22 Dec 2014 Still Waiting: House of Representatives Over-Criminalization Task Force Report

Over the past six months, we have been keeping a watchful eye on the U.S. House of Representatives Over-Criminalization Task Force and awaiting the results of their efforts. Since June 2013, the Task Force has held eight hearings to discuss a wide array of topics and to obtain expert testimony pertaining to the federal criminal code and the consequences of this country’s perpetually expanding federal criminal laws. The Task Force concluded its proceedings in early August 2014, but a report has not yet been issued. As we await the report, we anticipate some very interesting observations and recommendations from the Task Force – recommendations that may have a significant impact on the federal criminal landscape.   In its first session in June 2013, the Task…

READ MORE
0 0

31 Oct 2014 A Cozy Relationship: The DOJ and JFTC, and the Potential Risks of Taking Advantage of JFTC’s Leniency Program

Over the past year, the United States Department of Justice (DOJ) and the Japanese Fair Trade Commission (JFTC) have made concerted efforts to coordinate and join forces in the enforcement of U.S. and Japanese antitrust policies. This growing relationship makes sense, from the agencies’ perspective, given that they are both responsible for upholding their respective antitrust laws and prosecuting violators. The relationship really makes sense when one considers that the DOJ Antitrust Division’s prosecution of Japanese auto parts manufacturers has resulted in over $2.4 billion in criminal fines from their ongoing investigation of price fixing and bid rigging in the auto parts industry. On the surface, the JFTC’s teeth don’t seem as sharp as the DOJ’s, especially in light of the JFTC’s much heralded Leniency…

READ MORE
0 0

04 Jun 2014 “Gatekeepers” Beware: A New Tool of the SEC

  In a recent speech at Compliance Week 2014, the premier conference for corporate compliance officers and government regulators, Securities and Exchange Commissioner Kara M. Stein expressed disappointment in the lack of scrutiny and infrequency of enforcement cases brought against what she called the “gatekeepers” – i.e. compliance officers, accountants, auditors and—yes—attorneys.   In Stein’s opinion, failures by those tasked with maintaining and promoting corporate compliance have led to tragic financial losses that have harmed innocent individuals and threatened confidence in the markets. Stein targeted attorneys, stating they in particular are rarely prosecuted even though they are deeply entrenched in almost every decision and transaction a company makes. Stein argued that attorneys who facilitate fraud or provide poor legal advice are typically protected from liability…

READ MORE
0 0

15 Apr 2014 Disgorgement in the Second Circuit: Equitable Relief or Punishment?

  In legal circles, disgorgement is known as an equitable remedy used to force a defendant to return money or property earned from illegal conduct.  Traditionally, disgorgement has not been used as punishment, but a recent Second Circuit decision has suggested that disgorgement may now be a punitive remedy in disguise.   In September 2005, Joseph Contorinis, an investment banker at Jefferies & Company, was given confidential information from a friend and fellow investment banker regarding a major financial acquisition.  Contorinis used the non-public information to make very profitable trades for a Jeffries’ fund that Contorinis managed and controlled.  By virtue of the information Contorinis had received and his subsequent trades, the fund earned a profit of $7,304,738, and avoided a loss of $5,345,700.  Most…

READ MORE