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Keeping a Lid on Dow
First Dow Chemical fired a senior executive and a board member purportedly for holding secret talks with private investors about a possible buy-out of the company. That has triggered dueling law suits in federal and state courts in Michigan and New York, and the centerpiece of the case is likely to be J.P Morgan Chase…
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No Insider Trading Is Too Small for the SEC These Days
The SEC’s crackdown on insider trading is bringing in some fairly small cases. In one case, the two defendants learned about the buy-out of Serologicals and the next day bought 500 and 400 shares. When the deal was announced the following day, the stock jumped 34%, and the defendants made $3,785 and $2,897. Not a…
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Insider Trading Investigation of Sallie Mae Chairman
The House Education & Labor Committee released information that representatives from student loan giant Sallie Mae met with the Office of Management & Budget in December 2006, less than two months before President Bush’s budget called for a significant cut in support for student loans that caused a significant drop in the company’s shares. Three…
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Fitzgerald Asks for Up to Three Years for Libby
Special Counsel Patrick Fitzgerald has asked U.S. District Judge Reggie Walton to impose a sentence of 30 to 37 months on I. Lewis Libby, the former chief of staff to Vice-President Dick Cheney who was convicted on perjury, false statement, and obstruction charges. The range is based on the Federal Sentencing Guidelines, which the Judge…
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Judge Tells Lord Black to Put a Sock in It
Lord Conrad Black’s reaction to the testimony of his former lieutenant, David Radler, was more than just a little bit testy. Black assailed the former chief operating officer of Hollinger International as a liar, something his attorney Edward Greenspan spent almost three days saying, and concluded that no "jury in the world would convict anybody…
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Second Circuit Upholds Convictions of John and Timothy Rigas
The U.S. Court of Appeals for the Second Circuit upheld convictions on twenty-two counts of conspiracy, securities fraud, and bank fraud of the former CEO and CFO of Adelphia Communications, John Rigas and his son, Timothy. The court reversed one bank fraud conviction for insufficient evidence. The Rigas family controlled Adelphia, a cable company that…
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H-P Gets a Slap on the Wrist
The internal investigation of boardroom leaks at Hewlett-Packard turned into a major controversy in September 2006, garnering significant negative publicity for the company when it came out that private investigators engaged in pretexting to obtain private telephone records of employees and journalists. All those negative headlines did not translate into any significant regulatory actions against…
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No Confidence Resolution on AG Gonzales Introduced
Senators Charles Schumer and Diane Feinstein introduced a resolution expressing a lack of confidence in Attorney General Alberto Gonzales. The text reads: "It is the sense of the Senate that Attorney General Alberto Gonzales no longer holds the confidence of the Senate and of the American people." That’s concise, to say the least, allowing those…
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Transparency International Issues Annual Global Corruption Report
International corruption watchdog Transparency International issued its 2007 Global Corruption Report, and the focus is on judicial corruption. The organization notes that "a corrupt judiciary erodes the international community’s ability to prosecute transnational crime and inhibits access to justice and redress for human rights violations. It undermines economic growth by damaging the trust of the…
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Goodling Points the Finger at McNulty
Monica Goodling’s testimony before the House Judiciary Committee began with a clear shot at Deputy Attorney General Paul McNulty, who said that his testimony in February 2007 about the firing of eight U.S. Attorney’s was not completely accurate because Goodling (among others) withheld information from him. In her prepared testimony (here), Goodling fired back: "I…
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