Evasion of Foreign Tax Can Be Mail Fraud
The Supreme Court has decided that the Federal mail and wire fraud statutes can be used in prosecutions involving schemes to defraud a foreign government of tax revenue. The April 26 decision, written by Justice Thomas, expansively interpreted the words of 18 U.S.C. '' 1341 and 1343 and narrowly interpreted the common law "revenue rule," which some courts had viewed as limiting the reach of these statutes in cases involving foreign tax evasion. <i>Pasquantino v. United States</i>, 125 S.Ct. 1766 (2005).
The World Economic Forum
The hills were alive with the sound of Sarbanes-Oxley in January when the Swiss mountain resort of Davos hosted the World Economic Forum. Representatives of some of Europe's largest companies discussed the impact of the U.S. legislation on their operations, asking whether the impact of the additional regulation was worth the prestige of a New York listing or the opportunity to raise money on the world's largest capital market. It was reported that up to 60 European companies were ready to drop their U.S. listings.
A Roundtable Discussion on Leading Compliance Issues in the U.S. and EU
Throughout the world, Sarbanes-Oxley (SOX) legislation might well have had the biggest impact in corporate governance since the introduction of limited liability. To that end, jurisdictions outside the U.S. have not been idle. A recent Eversheds survey found more than 100 studies on the topic in 29 European countries within and outside the EU. Clearly, proper compliance to corporate governance guidelines is top of the list to in-house counsel across the EU, as well as the U.S. This roundtable sought to road-test some of these issues and look to some of the U.S.'s best governed corporations to see if there is a map for the journey ahead.
The Corporate Attorney-Client Privilege Survives
The dangers to the proper functioning of the corporate attorney-client privilege in the wake of recent federal and state law enforcement activities have been well-documented and widely discussed. The year is only half over and already two reports on the issue have been produced and a third major inquiry is underway. A survey by the Association of Corporation Counsel disclosed that 30% of the respondents' corporate clients had "personally experienced an erosion in protections offered by privilege/work product." A similar survey of outside counsel conducted by the National Association of Criminal Defense Lawyers reported 47% of corporate clients had experienced such an erosion. Both organizations have taken up the difficult task of 'debunking the myth' that assertion of the privilege is inappropriate or a sign of guilt.
In The Courts
National rulings of interest to you and your practice.
Enforcement Against Market-Driven Misconduct
Government plays a critical role in the design of some free markets and in the operation of many. The recent energy debacle in California resulted in part from defective governmental design of California's markets for wholesale and retail electricity. Even where markets are shaped largely by private-sector activity, government often has a critical role in influencing the incentives that guide conduct in those markets. In particular, law enforcement agencies, especially regulatory agencies, have a critical responsibility for the proper functioning of competitive markets within their jurisdiction -- the responsibility to elaborate and enforce applicable laws so as to constrain market forces from driving participants into socially undesirable conduct.
The Benefits of Booker for Cooperating Defendants
The Supreme Court's decision in <i>United States v. Booker</i>, 125 S.Ct. 738 (2005), brought significant changes to federal criminal procedure. Mandatory sentences under the federal Sentencing Guidelines (Guidelines) became advisory, and with this change came some subtle but important opportunities for criminal defendants who cooperate or provide "substantial assistance" in prosecutions. Now, convicted corporations and employees may be able to provide more input to courts about their cooperation with or assistance to the government. This may make sentencing judges more willing to grant downward departures from sentences calculated by Guidelines formulas.
