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Business Crimes Bulletin
Federal Public Corruption Prosecutions
Elkan Abramowitz and Jonathan S. Sack
This article describes pending federal prosecutions, which level corruption charges against high-level officials, considers how the theories of prosecution in these cases might be viewed in light of court decisions in other public corruption cases, and concludes with some observations about the outer limits of federal public corruption prosecutions.
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Business Crimes Bulletin
Corporate ESG Integration Not Optional
Alexandra Poe and Bryan Sillaman
Corporate ESG (environmental, social and governance) integration is becoming less optional every day, driven by increasing regulation, investor demand and the recent embrace of stakeholder capitalism.
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Business Crimes Bulletin
Congress Leaves SEC Subject to Litigation Over Disgorgement
Sarah Aberg and Chris Bosch
Buried in the massive National Defense Authorization Act for Fiscal Year 2021 is §6501, a provision authorizing the SEC to seek disgorgement of unjust enrichment within 10 years for certain securities law violations, and five years for others.
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Business Crimes Bulletin
Criminal Liability of Executives and In-House Attorneys for Corporate Actions
Joseph G. Poluka and David J. Oberly
Data breaches, while frequent in number and severity, remain big news events today. Even more newsworthy is when a corporate in-house attorney is criminally prosecuted in connection with his role in responding to a data breach event.
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Business Crimes Bulletin
Anti-Money Laundering Enforcement Update
Kyle R. Freeny and Benjamin G. Greenberg
Over the last decade or so, anti-money laundering (AML), counter-terrorism financing (CFT), and sanctions compliance have been the subject of increased enforcement efforts. We expect this trend to accelerate in 2021 and beyond, propelled at least in part by the recent enactment of the Anti-Money Laundering Act of 2020.
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Business Crimes Bulletin
Telehealth Enforcement: Is It the Next Big Thing?
Ty E. Howard, Scarlett S. Nokes, Gene R. Besen and Jason P. Mehta
With the Biden administration and a DOJ led by Merrick Garland, predictions have begun about future trends in government enforcement. Two pieces of conventional wisdom emerge: First, the focus will shift to more white-collar crime enforcement actions. And second, the healthcare industry will continue to be a major focus for investigators and prosecutors.
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Business Crimes Bulletin
Congress Expands SEC Powers Just In Time for New Administration
Robert J. Anello and Richard F. Albert
Wall Street has greeted Gary Gensler’s nomination as Chair of the SEC with some trepidation, perhaps with good reason. Congress, by contrast, may have presented him with a powerful signing bonus.
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Business Crimes Bulletin
Global Increase of FCPA Bribery Cases Raises Specter of Piling On
Sozi Pedro Tulante and Joshua Drew
The increasing number of regulators and enforcement agencies bringing foreign bribery cases across the globe raises the specter of successive or “carbon copy” cases. Policymakers and practitioners need to be aware of this developing risk and take steps to mitigate it.
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Business Crimes Bulletin
Does Corporate Attorney-Client Privilege Extend to Company Executive?
Elkan Abramowitz and Jonathan S. Sack
The question of when does company counsel also represent a company executive often comes up in white-collar issue investigations.
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Business Crimes Bulletin
Best Practices for Virtual Internal Investigations
Peter W. Baldwin, Daniel E. Pulliam, Elizabeth B. Boggia and Sophie H. Gotlieb
In order to ensure that remote internal investigations are probative and effective, companies and their outside counsel should employ a few simple and practical practices.
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Business Crimes Bulletin
Considerations When Entering Into a Tolling Agreement
Evan T. Barr and Christopher H. Bell
Defense counsel in complex white-collar investigations are often asked to waive these important protections by entering into tolling agreements, stopping the clock on the statute of limitations at issue. Whether such an agreement is actually in a target or subject’s best interest presents a difficult question, and COVID-19 has impacted the calculus.
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Business Crimes Bulletin
Leveraging Data to Drive Innovation in A Post-Pandemic World
Debra Baker
With a new year and fresh outlook for the future, the time is ripe for legal technologists and innovators to take the delivery of legal services and client experience to the next level. One key is recognizing that successful innovation is equal parts mindset, method and message.
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Business Crimes Bulletin
Not-So-Incidental Byproducts of 'Kelly'
Gary Stein
Early returns are in, and they indicate that the Supreme Court’s decision in the so-called “Bridgegate” case will be an effective tool for pruning the wild overgrowth that has built up around the federal fraud statutes.
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Business Crimes Bulletin
Second Circuit Ruling on Personal Benefit Test Widens Scope of Criminal Insider Trading
Robert J. Anello and Richard F. Albert
The holding in Blaszczak significantly widens the scope of criminal insider trading. It also creates the anomaly of extending the criminal law beyond the SEC’s civil enforcement authority.
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Business Crimes Bulletin
Equal Justice Should Apply to All, Including the President’s Friends
Harry Sandick and Jacob Tuttle Newman
This article considers certain positions taken by DOJ in cases involving Roger Stone, Michael Flynn and the subpoenas duces tecum issued by the New York District Attorney’s Office in connection with its investigation into the Trump Organization.
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Business Crimes Bulletin
Defending Attorneys Against Extortion Charges Presents Unique Challenges
Bradley A. Marcus
Although the criminal prosecution of lawyer misconduct is nothing new, the recent indictment of a plaintiffs’ lawyer in Maryland and sentencing of two plaintiffs’ lawyers in Virginia illustrate the particular danger to attorneys who arguably cross the line during negotiations with potential litigation counterparties.
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Business Crimes Bulletin
Implications of a More Conservative Supreme Court for White-Collar Practitioners
Robert J. Anello and Richard F. Albert
A review of recent decisions of the Roberts court and of decisions in which Barrett participated during her limited tenure on the U.S. Court of Appeals for the Seventh Circuit provides some hints regarding how the Supreme Court’s future decisions may affect the law relevant to white-collar criminal practice.
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Business Crimes Bulletin
SCOTUS Set to Address Circuit Split in Interpreting CFAA
Elkan Abramowitz and Jonathan S. Sack
The Computer Fraud and Abuse Act (CFAA) is the sort of broadly worded criminal statute which gives white-collar prosecutors considerable power — and makes defense counsel and judges uneasy. The meaning of “or exceed[ing] authorized access” is not so clear.
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Business Crimes Bulletin
Biden Administration May Bring Uptick In White-Collar Work
Andrew Maloney
With a change in priorities, and issues such as health care, climate and another stimulus package potentially on the agenda for President-elect Joe Biden, white-collar defense lawyers anticipate an uptick in enforcement work.
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Business Crimes Bulletin
Ransomware: To Pay or Not to Pay Is Not the Question
Michel Sahyoun
It is not the ransom but the costs associated with the failure to prevent the attack and the consequent remediation that may prove to be a real company killer.
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Entertainment Law & Finance
Inside Prosecutors’ 5Dimes Deal for Offshore Online Sports Betting
Ross Todd
Laura Varela was unaware that her husband, William Sean Creighton, was under investigation by the U.S. Department of Homeland Security and prosecutors in the Eastern District of Pennsylvania for his 5Dimes sports betting website until Creighton was kidnapped — and later found dead.
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Business Crimes Bulletin
No ‘Fishing’ In Trump Tax Return Case
Steven A. Cash
“Give a man a fish, and you feed him for a day. Teach a man to fish, and you feed him for a lifetime.” Judge Victor Marrero, writing in a decision dismissing the President’s civil suit under the Civil Rights Act, neither gives a fish, nor teaches how to fish — rather he explains what fishing is.
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Business Crimes Bulletin
The ‘Right to Control’ Wire Fraud Theory Should Be Eliminated
Harry Sandick and Ian Eppler
In recent decades, federal fraud prosecutions have relied on the theory that a defendant can fraudulently deprive a victim of the intangible “right to control” its assets, even if the victim is not deprived of any tangible money or property. While this theory has been repeatedly affirmed by the Second Circuit, it is incompatible with a series of recent Supreme Court cases in which the Court has narrowed the scope of federal white-collar criminal statutes by adopting narrow definitions of the term “property.”
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Business Crimes Bulletin
Don’t Set It & Forget It: The Importance of Evaluating & Evolving Healthcare Compliance Programs
Brian Bewley, James D. Gatta and Kaitlyn L. Dunn
The federal government won or negotiated over $2.6 billion in healthcare fraud judgments and settlements in 2019. The government’s investment of resources toward combatting fraud, waste and abuse in healthcare can be expected to continue in full force, irrespective of a change in political administration. Accordingly, it is important for healthcare companies to focus on maintaining flexible and effective compliance programs.
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Business Crimes Bulletin
Corporate Compliance Programs and the DOJ’s Emphasis on Data Analytics: What Companies Need to Consider
Jonathan B. New, Jimmy Fokas, Patrick T. Campbell and Bari R. Nadworny
In recent months, the Dept. of Justice has raised expectations for companies to use data analytics to monitor the effectiveness of their compliance programs and to identify potential misconduct.
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Business Crimes Bulletin
The Potential for Fraud or Misbehavior In the Time of COVID-19
A roundtable discussion on the topic of government investigations, corporate compliance efforts, and the potential for fraud or misbehavior in the time of COVID-19.
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Business Crimes Bulletin
Particularized Pleading of Underlying Illegal Acts in the Second Circuit
Steven Paradise and Matthew Catalano
Gamm v. Sanderson Farms, establishes a high burden for a plaintiff to plead adequately failure to disclose illegal conduct — regardless of how much circumstantial evidence a plaintiff is able to amass or how much news coverage the alleged conduct attracts.
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Business Crimes Bulletin
The Updated FCPA Resource Guide
Jacqueline C. Wolff
Something Old, Something New, Something Borrowed, Something Blue
this second edition contains some new “hypotheticals” — facts of actual cases the DOJ finds important enough to focus on — and, in keeping true to its name, has included additional resources and links for chief compliance officers looking to design and audit their companies’ anticorruption compliance programs.
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Business Crimes Bulletin
FIFA Decision Confirms Long Arm of Honest Services Fraud
Robert J. Anello and Richard F. Albert
United States v. Napout
The U.S. government’s lead role in the prosecution of corruption within the Zurich-based FIFA may be a paradigmatic example of U.S. law enforcement acting as the world’s policeman. If corruption is based on foreign executives violating their duties of loyalty to foreign private entities, how does that translate into a violation of U.S. criminal law? Does it matter that the conduct in which the foreign executive engaged — commercial bribery — may not be illegal under the law of the executive’s home country?
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Business Crimes Bulletin
Is an ‘Official Act’ An Element of Public and Private Corruption?
Elkan Abramowitz and Jonathan S. Sack
This article discusses cases that have begun to address whether “official act” is an element in a private honest services fraud prosecution.
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Business Crimes Bulletin
Lessons from the Insider Trading Prohibition Act After Its Likely Demise In the Senate
Telemachus P. Kasulis
For a moment there, it really looked like it was going to happen. After a long and winding road, insider trading reform had reached the floor of the House of Representatives for a vote. The Insider Trading Prohibition Act (ITPA) had support on both sides of the aisle and on Dec. 5, 2019, the House voted to pass the ITPA. Then the bill went to the Senate and vanished. We should take this opportunity to learn what lessons we can from the successes and failures of the ITPA as a bill with an eye toward fashioning the best possible legislation next time — whenever that may be.
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Business Crimes Bulletin
An Ounce of Prevention: Preparing for CARES Act Fraud Investigations
Nekia Hackworth Jones
The government appears to be fulfilling its commitment to rooting out PPP fraud, even when the amount at issue falls below the $2 million threshold. No matter the size of the loan, a company that obtained PPP funds is not immune from a possible government investigation or audit. Borrowers have already started to submit loan forgiveness applications, and many more will be submitted in the weeks ahead, and both lenders and the government will be scouring these submissions for red flags.
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Business Crimes Bulletin
Survey Says: Tips On Getting Over the Daubert Hurdle
Rebecca Kirk Fair, Peter Hess and Vendela Fehrm
This article draws on a review of over 300 U.S. court rulings in cases involving surveys, including over 150 Daubert motions, and provides suggestions for getting survey evidence admitted for consideration in court. Our recommendations fall under two broad categories: relevance and reliability.
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Business Crimes Bulletin
Where Will the Needle Land?
Scott Pink and John Dermody
COVID-19 Contact Tracing v. Protecting Personal Privacy
As states roll back stay-at-home orders, contact tracing has quickly emerged as an essential tool to manage the spread of the coronavirus and allow the country to return to work safely. But innovative contact tracing methods raise a host of privacy concerns, forcing a reckoning with how we balance privacy and public health.
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Business Crimes Bulletin
Preparing for the LIBOR Phase Out: Contract Remediation Starts with Contract Intelligence
Ryan Drimalla and Karl Dorwart
The London Interbank Offered Rate has long been the global basis for agreements that include a variable interest rate component. However, LIBOR would be replaced by other benchmarks by the end of 2021. Key to assessing risk of exposure, quantifying the financial impact, developing remediation plans and communicating material information to stakeholders will be the identification, analysis and remediation of LIBOR-based contracts.
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Business Crimes Bulletin
Supreme Court Reins in Broad Reading of Fraud Statutes with ‘Bridgegate’ Case Ruling
Robert J. Anello and Richard F. Albert
When federal prosecutors focus their attention on high profile misconduct that is not an obvious violation of federal criminal law, they often cannot resist the attractions of broadly worded “catch-all” fraud statutes. From time to time, however, the U.S. Supreme Court has pushed back on efforts to further expand the boundaries of these statutes, leading to reversals of some well-publicized criminal convictions.
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Business Crimes Bulletin
Shareholder Class Actions During, and After, COVID-19
Margaret A. Dale and Mark D. Harris
Given the current turmoil in the markets, an increasing number of plaintiffs are bringing shareholder class action suits, citing corporate statements about COVID-19. As first-quarter earnings season draws to a close, now is a good time to reflect on the shareholder class actions that have been brought to date related to COVID-19, and others potentially yet to come.
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Business Crimes Bulletin
What TARP Investigations Can Teach Us About Stimulus Fraud
Terence M. Grugan, David L. Axelrod and Emilia McKee Vassallo
For more than 10 years, federal investigators have investigated criminal conduct in connection with the 2008 recession-era TARP program. From those investigations, U.S. Attorneys across the country brought cases and earned convictions for offenses spanning the federal criminal code. We can expect that these same agencies will use the same techniques and strategies to investigate crimes and bring cases involving fraud related to the COVID-19 stimulus packages.
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Business Crimes Bulletin
SEC Targeting Fraudulent Disclosures During Pandemic
Russell Koonin and Adam Schwartz
In the midst the current COVID-19 pandemic, the SEC is paying attention. The Division of Enforcement has made clear that it will act, and act quickly, to stop fraudulent conduct that falls under its jurisdiction related to the pandemic.
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Business Crimes Bulletin
Defending FCA Actions Related to Pandemic Programs
Steve Sozio, Rebecca Martin, Rajeev Muttreja and Mark Rotatori
With the federal government appropriating more than $2 trillion for businesses affected by the COVID-19 pandemic, plaintiffs’ lawyers, regulators and politicians have trumpeted the search for whistleblowers — many of whom will try to cash in on perceived fraud in the funding programs created by the CARES Act and other enactments.
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Business Crimes Bulletin
Corporate Criminal Liability in the COVID-19 Era
Carolyn H. Kendall
Compliance Programs Offer Companies an Opportunity to Mitigate Risk
This article outlines the principles of corporate criminal liability, including the factors prosecutors consider when making charging decisions, and the potentially available sanctions in light of applicable U.S. Sentencing Guidelines, and offers strategies for minimizing risk, including lessons from recent criminal enforcement actions.
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Business Crimes Bulletin
CARES Act Puts Inspectors General Back in the Spotlight
Daniel R. Alonso, Preston Burton and Meredith Leeson
IGs have been part of the federal landscape for more than 40 years, so why all the fuss now? The answer is that they are a key element of the government’s built-in mechanisms for protecting the nation’s public treasury, and a relief package of this scope strongly indicates that the IGs and the new oversight bodies will spend many years scrutinizing funds spent under it.
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Business Crimes Bulletin
Prosecuting PPP Fraud May Be Harder Than It Seems
Christopher M. Ferguson
This article discusses what tools the government has for pursuing seemingly undeserving PPP borrowers, the obstacles to bringing such cases, and the factors that may influence the government’s decision in pursuing criminal or civil cases.
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Business Crimes Bulletin
Defending FCA Actions Related to Pandemic Programs
Steve Sozio, Rebecca Martin, Rajeev Muttreja and Mark Rotatori
There will likely be some fraud in connection with the pandemic-related programs that should be pursued by the DOJ and the Inspectors General, who have said they will keep close eyes on these programs. They will have no shortage of targets, given the many recipients of government funds, and the breadth of the requisite certifications.
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Business Crimes Bulletin
New FCPA Decision Limits DOJ’s International Reach
Harry Sandick and Devon Hercher
In recent years, we have seen the DOJ expand its international focus, as it looks to punish foreign nationals, often for conduct that occurred almost entirely outside of the territorial borders of the United States. DOJ’s eagerness, however, has not been matched by judicial enthusiasm concerning the extraterritorial application of U.S. law.
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Business Crimes Bulletin
Federal Crackdown on Hoarding and Gouging During COVID-19 Crisis
Marjorie Peerce and Justin Kerner
Storage and Hauling Companies Take Note
Imagine that it’s Spring 2020 and you run a warehousing company and you discover that your warehouse contains containers of goods that could help combat the spread of the COVID-19 virus — masks, medical gowns, gloves or other personal protective equipment (PPE). Or imagine you own a trucking company and learn that your drivers are delivering pallets of hand sanitizer and disinfectants to a residential address. What, if any, liability might you have if it turns out a customer is hoarding PPE?
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Business Crimes Bulletin
Cutting Off the Stream: How United States v. Silver Affects “Stream of Benefits” or “Retainer” Bribery
James D. Gatta, Andrew Kim and Emily M. Notini
Although the court stressed that, by vacating certain of former NY State Assembly Speaker Sheldon Silver’s counts of conviction, it was clarifying and not altering the “as opportunities arise” theory, it nevertheless emphasized that this theory requires particularity with respect to the “question or matter” that is the subject of the bribe payor and recipient’s corrupt agreement.
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Business Crimes Bulletin
Conducting Internal Investigations During the COVID-19 Pandemic
Jacqueline C. Wolff, Scott T. Lashway, and Matthew M.K. Stein
In times of crisis, criminal activity — particularly crimes involving theft and fraud — tend to spike. There is no reason to believe that the Covid-19 pandemic and the unrest in the financial markets will be any different. An important difference for company counsel, however, will be in how the malfeasance, negligence or wrongdoing can be investigated.
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Business Crimes Bulletin
Force Majeure and the Doctrine of Impossibility
John Kelly
The COVID-19 pandemic is resulting in landlords and tenants closely reviewing a clause in their lease that was long considered unimportant boilerplate. Yes, we are referring to the “force majeure” provision.
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Business Crimes Bulletin
New Normal Sets In for White-Collar Lawyers in the Virus Era
C. Ryan Barber
In a practice that prizes in-person meetings, virtual communication has become commonplace.
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