United States Sentencing Commission Issues Proposed Guidelines Related to the Sentencing of Companies Charged With Federal Crimes

Last month, the United States Sentencing Commission (“USSC”) proposed several modifications to the United States Sentencing Guidelines that will have far-reaching ramifications for any company caught up in a federal investigation.

Internal Investigations Prove Valuable But Hold Some Traps

The internal investigation has long been a hallmark of the best practices of any company that is confronted with allegations of misconduct.

Unfortunately, it appears that many more businesses will face the need for internal investigations in the future. The economic meltdown, the resulting push for more regulation by Congress and the recent legislative changes to the federal whistleblower statute make it inevitable that more managers and boardrooms will receive reports of misconduct.

Broadcom: Lessons From the Frenzy Over Stock Options Backdating

Last month, a federal judge in Santa Ana, Calif., dismissed with prejudice federal criminal fraud charges against several Broadcom Corp. executives and essentially terminated one of the last of the stock options backdating cases brought by federal prosecutors. As the dust settles on this case, there are lessons to be drawn from that one case and from the plethora of investigations the government commenced on the issue of stock options backdating.

Feds Heat Up Investigations and Enforcement for Entities With TARP Funds

As was widely reported in the press several months ago, the federal government hired a former federal prosecutor to act as the Deputy Special Inspector General for monies given out under the Troubled Asset Relief Program (“TARP”). The Inspector General was given a staff to assist in this process, and all these folks work for the newly-minted federal agency called The Office of the Special Inspector General for the Troubled Asset Relief Program (“SIGTARP”).

Foreign Corrupt Practices Act Update: A Rare Jury Trial, Increased Resources by the Feds and a Novel Theory to Charge Upper-Management All Reaffirm the Need for Vigilance in Policing a Company’s International Practices

Following a six-week jury trial in Manhattan federal court, a Connecticut investor was found guilty of conspiracy to violate the Foreign Corrupt Practices Act (“FCPA”). The case is noteworthy because FCPA cases rarely go to trial and the post-trial comments of the jurors provide insight into the critical “due diligence” a company or individual needs to undertake to avoid FCPA investigations by the government.

View full article (PDF).

IRS Sharpens Tools in Pursuit of Alleged Tax Violations

Two recent court cases – one that received much press and another less-publicized case – both demonstrate the IRS’s aggressive stance on investigating alleged tax violations and the degree to which the courts will bless such conduct over the protests of corporate and individual taxpayers.

View full article (PDF).

Demand Continues to Rise for Help of Forensic Accountants

The field known as forensic accounting has become an increasingly important, if not vital and indispensable, tool for a wide range of industries. View full article (PDF).

This article appeared in the Portland Business Journal.

Swallowing the Wrong Pill – Criminal Drug Diversion by Medical Professionals: A Federal Prosecutor’s Perspective

I am a federal prosecutor in Seattle. During the past two years, I have participated in a series of prosecutions of physicians and other health care professionals for criminal conduct involving the unlawful diversion of controlled substances. The drugs involved in these cases included highly abused opiates such as oxycodone, hydrocodone and meperidine.  View full article.

This article first appeared in Pain Medicine News.

Six Critical Strategies for a Company Under Investigation

In 2009, for a variety of reasons, more and more businesses in Oregon and across the nation will become susceptible to investigations than at any other time in history. View full article (PDF).

This article first appeared in the Portland Business Journal.

Justice Department takes on ‘malicious’ mortgage lenders

In times of national economic upheaval, the criminal justice system often seems to be the janitorial squad of emergency management. View full article (PDF).

This article first appeared in the Portland Business Journal.

‘Scheme liability’ can put professional firms at risk

As the developing “credit crunch” places more businesses under financial stress, and as the investors in these businesses grow restless, Oregon firms that provide financial and related services to those businesses should be watchful. View full article (PDF).

This article first appeared in the Portland Business Journal.

The Subprime Crisis: Will the Feds Show Up at Your Doorstep?

The subprime mortgage crisis is unique in America’s array of economic downturns. There have been banking crises on Wall Street (most recently, the Savings and Loan scandal) and real estate and mortgage crises on Main Street, but this crisis is on both. It spans the entire mortgage industry and reaches across the globe. View full article (PDF).

Not Your Father’s Banking Crisis: Confronting the Subprime Fallout

The so-called subprime mortgage crisis is the hottest topic around. Staggering bank losses related to defaulted or risky mortgages are being splashed daily across the news. View full article (PDF).

Federal Regulators and Prosecutors Ramp Up Resources in the Mortgage Fraud Arena

Continuing its aggressive post-Enron investigation of white-collar crime, the federal government has trained its sites on the mortgage financing industry. For example, the FBI recently announced: “The FBI views mortgage fraud as a significant and growing crime problem. The mortgage lending and housing market have a considerable overall effect on the nation’s economy and combating mortgage fraud will remain a top priority for the FBI. … The FBI is proactively working with the mortgage industry in an effort to curb mortgage fraud crimes.” View full article (PDF).

Internal investigations: Be alert, be prepared and hire the right professionals

Business professionals working in the post-Enron landscape are acutely aware of perils that can arise from the misconduct of employees, officers, directors and even independent contractors. These perils, including financial and criminal exposure at the individual level, have heightened concerns about compliance and enforcement. View full article (PDF).

Don’t Take the Money and Run – Be Careful When a Client Pays in Cash

I am an assistant U.S. attorney in Seattle, Wash. During the past 12 months, I have participated in the investigation and prosecution of four attorneys for felony offenses which they committed in their professional practices. Each of these attorneys has either been disbarred or is in the process of disbarment proceedings. As a result of their conduct and prosecution, their law practices have been ruined. I write out of a concern for what has happened to them, a concern for our common endeavor to practice law, and a concern for the public perception of lawyers. Also, I write in the hopes that by reading this article, attorneys may avoid such misconduct in the future.  View full article (PDF).

This article first appeared in The Champion.

Feds at Your Doorstep: More Policing of U.S. Corporations

One would have to have lived under a rock for the last five years to not notice the increased pursuit of white collar crime in corporate America. While frauds and scandals at Enron, Adelphia, WorldCom, and Cendant have received much publicity in recent years, they are only the proverbial tip of the iceberg as the government has ratcheted up regulations and enforcement against all types and sizes of businesses. View full article (PDF).

This article first appeared in the Portland Business Journal.

Seven Things a Prosecutor Probably Won’t Tell You – (I Know. I Used to be One)

Of course, you have to cooperate if a prosecutor starts asking questions about your company. For one thing, many federal and local investigations are no more than that and don’t necessarily lead to prosecution. Allegations by anonymous whistleblowers, for example, may turn out to be groundless, but they always have to be looked into. View full article (PDF).

What Every Business Needs To Know About The Long-Arm Reach of Anti-Bribery Statutes

Is your company conducting international transactions or involved in foreign commerce? If you answered yes, then now is the time to get acquainted with the Foreign Corrupt Practice Act (FCPA). The FCPA makes it unlawful to offer, promise or make a corrupt payment to a foreign entity in order to obtain an unfair advantage in business. Learn more about FCPA and how your organization can comply. View full article (PDF).

Congress, the Courts, and the Feds Agree – Bankruptcy Crime Does Not Pay

While the debate over various aspects of bankruptcy reform continues, there is one area where a consensus has clearly developed and taken deeper root – criminal bankruptcy activity is treated seriously and punished more severely than ever. Along with the sweeping changes made to other areas in the Sarbanes-Oxley Act3 , Congress addressed bankruptcy crime by including a provision making it easier to prosecute those who play games of any sort with records or documents involved in a bankruptcy case.4 At the same time, the United States Department of Justice stepped up its eçorts to prosecute bankruptcy crimes despite the reallocation of many law enforcement resources to the terrorism battle. View full article (PDF).