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New Use of Wiretaps in Insider Trading Cases
As 2008 ended with the arrests of Marc Dreier and then Bernard Madoff nine days later, it seemed unlikely that 2009 would prove as significant. Then, on Oct. 16, 2009, federal agents arrested Raj Rajaratnam, the founder of hedge fund Galleon Group, in an alleged insider trading scheme that involved well known public companies and thus far 20 defendants, including lawyers, stock traders, management consultants, and executives inside the issuers themselves. Unlike the Dreier and Madoff cases, these arrests proved shocking not simply because highly placed members of the financial, business and legal world were seen in handcuffs, but also because of how they got there.
The Department of Justice (“DOJ”) relied heavily on wiretapped telephone conversations to build its case. According to Preet Bharara, the U.S. Attorney for the Southern District of New York, the case against Rajaratnam and his co-defendants is the “first time that court-authorized wiretaps have been used to target significant insider trading on Wall Street,” and all defendants charged “were ultimately caught committing their alleged crimes over phones that [law enforcement was] listening to.” The technique proved fruitful: in addition to the 20 arrests from across the country, DOJ suggests that more are forthcoming. As of this writing, five hedge fund managers and an attorney have pled guilty.
The DOJ's Corporate Enforcement Policy: One Year Later
The DOJ's Criminal Division issued three declinations since the issuance of the revised CEP a year ago. Review of these cases gives insight into DOJ's implementation of the new policy in practice.
The DOJ's New Parameters for Evaluating Corporate Compliance Programs
The parameters set forth in the DOJ's memorandum have implications not only for the government's evaluation of compliance programs in the context of criminal charging decisions, but also for how defense counsel structure their conference-room advocacy seeking declinations or lesser sanctions in both criminal and civil investigations.
Use of Deferred Prosecution Agreements In White Collar Investigations
This article discusses the practical and policy reasons for the use of DPAs and NPAs in white-collar criminal investigations, and considers the NDAA's new reporting provision and its relationship with other efforts to enhance transparency in DOJ decision-making.
Bankruptcy Sales: Finding a Diamond In the Rough
There is no efficient market for the sale of bankruptcy assets. Inefficient markets yield a transactional drag, potentially dampening the ability of debtors and trustees to maximize value for creditors. This article identifies ways in which investors may more easily discover bankruptcy asset sales.
A Lawyer's System for Active Reading
Active reading comprises many daily tasks lawyers engage in, including highlighting, annotating, note taking, comparing and searching texts. It demands more than flipping or turning pages.