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Business Crimes Hotline
NEW YORK
Former Ropes & Gray Attorney Sentenced to 30-Month Imprisonment
On June 30, Arthur Cutillo, the disbarred former attorney at Ropes & Gray LLP, was sentenced to a 30-month prison term, along with a two-year term of supervised release and court-ordered forfeiture of $378,608, by Judge Richard J. Sullivan of the United States District Court for the Southern District of New York. Cutillo had previously pled guilty to a single count each of conspiracy and securities fraud in January 2011 for his role in the Galleon insider trading case. According to the government, the forfeiture amount corresponded to the “amount of foreseeable proceeds obtained as a result of the securities fraud offenses.”
According to the government, from 2007-2008, in exchange for cash payments, Cutillo provided a then-hedge fund manager with inside information regarding several public company acquisitions and mergers ' deals on which Ropes & Gray was providing legal services.
In announcing Cutillo's sentencing, U.S. Attorney for the Southern District of New York Preet Bharara stated: “Attorney Arthur Cutillo exploited his access to confidential information in exchange for cash. With today's sentence, he now joins a growing group of privileged professionals who are paying a high price for insider trading.”
Cutillo's co-conspirator and co-defendants await sentencing, currently scheduled for later this year, after their respective convictions on related conspiracy and securities fraud counts.
PENNSYLVANIA
Former President of Department of Defense Contractor Enters Guilty Plea
Justin W. Lee, former president of defense contractor Lee Dynamics International, on July 15, entered a guilty plea on five counts in connection with a scheme to bribe U.S. military officials in order to gain government contracts providing services to the U.S. military in Iraq. In the plea, entered before Judge Joel H. Slomsky of the United States District Court for the Eastern District of Pennsylvania, Lee pled guilty to an indictment charging him with four substantive counts of bribery, along with a single count of conspiracy to commit bribery. The indictment also included charges against Lee's father, George H. Lee, Jr., the former chairman and chief executive officer of Lee Dynamics International. George H. Lee, Jr. currently remains at large.
In entering his plea, Lee admitted that, as part of a conspiracy with his father and others to secure Department of Defense contracts supporting U.S. combat operations in Iraq, he made bribes to military contracting officers totaling more than $1.2 million. Beyond just cash, the bribes were made via a number of items of value, including airline tickets, meals, hotel stays, spa visits and jobs. Subsequently, Lee's company successfully secured multi-million dollar contracts on which bribes had been paid.
Prior to Lee's guilty plea, four of the military contracting officials with whom he conspired had already pled guilty for their respective roles.
In announcing Lee's plea, Assistant Attorney General Lanny A. Breuer stated: ” ' Private contractors will not be allowed to win business by stacking the deck against the competition and, as this investigation shows, the military officials who participate in such fraudulent schemes will also be held to account.”
Robert Craig, Special Agent in Charge for the Defense Criminal Investigative Service, Mid-Atlantic Field Office, added: “This plea illustrates that it does not matter where they reside, work, or travel, the Defense Criminal Investigative Service will not stop pursuing those individuals who steal funds from the Department of Defense and U.S. taxpayers.”
Lee, who will be sentenced at a later date, faces up to a 15-year prison term for each substantive bribery conviction, along with a five-year maximum sentence for conspiracy to commit bribery. He also faces a $250,000 fine for each bribery count (or, alternatively, three times the bribe value), as well as a $250,000 fine for the conspiracy count.
Former
On June 30, Arthur Cutillo, the disbarred former attorney at
According to the government, from 2007-2008, in exchange for cash payments, Cutillo provided a then-hedge fund manager with inside information regarding several public company acquisitions and mergers ' deals on which
In announcing Cutillo's sentencing, U.S. Attorney for the Southern District of
Cutillo's co-conspirator and co-defendants await sentencing, currently scheduled for later this year, after their respective convictions on related conspiracy and securities fraud counts.
PENNSYLVANIA
Former President of Department of Defense Contractor Enters Guilty Plea
Justin W. Lee, former president of defense contractor Lee Dynamics International, on July 15, entered a guilty plea on five counts in connection with a scheme to bribe U.S. military officials in order to gain government contracts providing services to the U.S. military in Iraq. In the plea, entered before Judge Joel H. Slomsky of the United States District Court for the Eastern District of Pennsylvania, Lee pled guilty to an indictment charging him with four substantive counts of bribery, along with a single count of conspiracy to commit bribery. The indictment also included charges against Lee's father, George H. Lee, Jr., the former chairman and chief executive officer of Lee Dynamics International. George H. Lee, Jr. currently remains at large.
In entering his plea, Lee admitted that, as part of a conspiracy with his father and others to secure Department of Defense contracts supporting U.S. combat operations in Iraq, he made bribes to military contracting officers totaling more than $1.2 million. Beyond just cash, the bribes were made via a number of items of value, including airline tickets, meals, hotel stays, spa visits and jobs. Subsequently, Lee's company successfully secured multi-million dollar contracts on which bribes had been paid.
Prior to Lee's guilty plea, four of the military contracting officials with whom he conspired had already pled guilty for their respective roles.
In announcing Lee's plea, Assistant Attorney General Lanny A. Breuer stated: ” ' Private contractors will not be allowed to win business by stacking the deck against the competition and, as this investigation shows, the military officials who participate in such fraudulent schemes will also be held to account.”
Robert Craig, Special Agent in Charge for the Defense Criminal Investigative Service, Mid-Atlantic Field Office, added: “This plea illustrates that it does not matter where they reside, work, or travel, the Defense Criminal Investigative Service will not stop pursuing those individuals who steal funds from the Department of Defense and U.S. taxpayers.”
Lee, who will be sentenced at a later date, faces up to a 15-year prison term for each substantive bribery conviction, along with a five-year maximum sentence for conspiracy to commit bribery. He also faces a $250,000 fine for each bribery count (or, alternatively, three times the bribe value), as well as a $250,000 fine for the conspiracy count.
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