From 24 years, to 6 years, and now finally to a camp setting.  Jamie Olis has finally arrived in a prison camp in Three Rivers, Texas.  No bars, and most of all – an ability to perhaps walk hand in hand with his child.  For someone serving a white collar sentence, this is a major achievement.  Like most individuals who fit the white collar category – Olis has no priors and can hardly be considered a security risk.  With new motions filed and pending, it will be interesting to see if the next step in this story is even better. (see here)

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The Jamie Olis Story has been one that needs to be followed.  From an initial draconian sentence, to a more modest term in prison, to watching those around him receive minimal sentences or fines — this case has been a case to continue to draw interest – as it should.  The bottom line here has always been – if you risk the trial – you risk an outrageously high punishment.

But today there is a new dimension to the Jamie Olis story.  It comes in the form of a motion filed by Olis’ new counsel, and is a Motion to Set Aside Jamie Olis’ Conviction Pursuant to 28 U.S.C.§ 2255.  The 105 page motion, not including introductory material, presents the argument that "[t]he United States Attorney’s Office (“USAO”) acted purposefully to sabotage Olis’ ability to prepare and defend his case by blocking funding from his former employer, Dynegy, despite the fact that Dynegy was legally and contractually obligated to pay the funds." 

The KPMG related case also contested DOJ interference with the company’s payment of individual attorney fees.  The Stein case brought to light DOJ practices in a deferred prosecution agreement.  The question is now whether Olis was deprived of his right to counsel and whether a court should examine this issue.  Olis, in his Memo "requests a hearing with evidence" and argues that "[t]he violation of Olis’ fundamental right to prepare and present his defense using funds lawfully available to him requires that the Court vacate Olis’ conviction and dismiss the charges against him with prejudice."

Memo – Download 2255_Olis_Memorandum_Final.pdf

See also – Tom Kirkendall’s Houston ClearThinker’s here; Larry Ribstein’s Ideoblog here; Paul Davies – Wall Street Journal here; Mary Flood – Houston Chronicle here; John Porretto – Houston Chronicle (AP) here; Loren Steffy – Houston Chronicle here.

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According to a press release of the U.S. Attorney’s Office for the Central District of California, the sentence issued by a judge in the U.S. District Court for the Central District of California to "the owner and operator of the now -defunct downtown investment advisor firm," was 87 months in prison and $28.8 million in restitution to individual investors and $2.4 million to Wells Fargo Bank.  The defendant had pleaded  "guilty to four counts of bank fraud, 11 counts of mail fraud, two counts of investment advisor fraud and two counts of criminal forfeiture."  The defendant was arrested outside the United States and returned to the U.S. to face these charges.

Press Release –  Download c_capital_yi_sentenced.113.pdf

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The Wall St Jrl reports that one of the individuals in the KPMG related case has agreed to plead guilty and cooperate against two others that remain charged.  Thirteen others were dismissed from the case. (see here and here).

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A DOJ press release reports on an attorney and two former judges in Mississippi being sentenced following jury convictions to charges of bribery, RICO, and fraud.  The attorney received a sentence of 11 years, a 2.7 million dollar fine, a 1.5 million dollar restitution that will be shared with a co-defendant, and a special assessment.  One of the judges received a sentence of 70 months incarceration plus the joint fine, restitution and special assessment, with the last judge receiving 110 months incarceration, a fine of 125,000 dollars and a special assessment.

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Hyundai Motor Group CEO Chung Mong-koo had his three year jail sentence for diverting over $100 million from the company into a political slush fund suspended by the Seoul High Court in favor of what is in effect five years of probation.  Hyundai accounts for approximately 7% of Korea’s exports, and Chung’s absence likely would have caused significant problems for the company because of the degree of control he exercises over the organization.  Along the lines of the old "too big to fail" approach to banks and other large industrial enterprises in the 1980s — remember the Chrysler bailout? — the appellate court viewed the collateral consequences on the country’s economy from sending away Korea’s second wealthiest man as more important than enforcing the sentence.  While the argument is sometimes made at sentencing in the U.S. that the leader of a company, usually a closely-held one, is too important to the business to be incarcerated, it would be very unlikely that any one individual in the United States would be viewed as so important to a publicly-traded company that he or she could not be removed as CEO to serve a jail sentence — even at a company that makes iPods, iPhones, and other cool gadgets.  A Reuters story (here) discusses the sentencing. (ph)

The former chairman of the board of E.S. Bankest received a 20-year prison term for his role in the $164-million fraud, the same sentence received by his brother, who was president of the factoring company.  According to a press release issued by the U.S. Attorney’s Office for the Southern District of Florida (here):

Evidence at trial showed that E.S. Bankest, a factoring company in the business of funding clients secured by clients’ accounts receivable, borrowed multi-millions of dollars of money from Espirito Santo Bank clients based on fraud, including fabricated accounts receivable; Espirito Santo Group eventually took the debt positions of the clients, and absorbed the loss. The indictment charged a conspiracy from approximately June, 1994, until August, 2003, when an examiner was appointed by the federal court to look into the affairs of the company, which collapsed.

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