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Stewart and Bacanovic Convictions Upheld
The Second Circuit upheld the convictions of Martha Stewart and Peter Bacanovic on conspiracy, false statement, perjury (Bacanovic only), and obstruction of an agency investigation charges in a published opinion (available on Findlaw here). The opinion is long — 74 pages — and goes into a fair amount of detail about the government’s evidence because…
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Former Dynegy Executives Receive Lighter Sentences
Former Dynegy Corp. executives Bill Gene Foster and Helen Sharkey, who entered guilty pleas and testified against Jamie Olis, another executive at the company, received sentences well below the government’s recommendation for their part in an accounting fraud. The three were involved in a program called Project Alpha that inflated Dynegy’s earnings by $300 million. …
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Looking for DeLay-Abramoff Connections
Not to be forgotten in all the hoopla about the guilty pleas of lobbyist Jack Abramoff is the pending case against Rep. Tom DeLay for money laundering and conspiracy in Texas. Travis County DA Ronnie Earle, who filed the charges against Rep. DeLay, is now pursuing information related to a $500,000 contribution from the National…
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Sen. Clinton’s Campaign Committee Fined $35,000
The AP reports (here) that a fundraising committee for Senator Hillary Clinton will pay a $35,000 fine for not properly reporting expenses related to a fundraising event in Los Angeles in 2000. The filings with the Federal Election Commission related to the event, which involved appearances by a number of Hollywood stars, eventually led to…
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SEC Announces Principles for Imposing Penalties on Companies
SEC Chairman Christopher Cox has cobbled together a set of principles (here) regarding when the Commission will impose civil penalties on companies ("issuers") who run afoul of the federal securities laws. Like any pronouncement of guidelines that will apply in a wide variety of cases, they are vague to the point of providing little more…
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Scrushy Ordered to Repay $47.8 Million in Bonuses
You can’t keep track of all the litigation related to HealthSouth and its former CEO, Richard Scrushy, without a crib sheet these days. In addition to the federal corruption charges against Scrushy (and former Alabama Governor Don Siegelman), the SEC’s securities fraud suit against him related to the accounting problems at the company, a breach…
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Abramoff Pleads Guilty to Florida Charges, and the Politicians Jump Ship
Lobbyist Jack Abramoff entered a guilty plea in U.S. District Court for the Southern District of Florida to pending conspiracy and wire fraud charges related to his purchase of the SunCruz gambling ships, his second acknowledgment of criminal conduct in two days. Because the conduct took place before 2002, the maximum penalty for each is…
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McAfee Settles SEC Channel Stuffing Securities Fraud Suit
McAfee, Inc., then known as Network Associates, settled an SEC securities fraud action (complaint here) alleging that the company engaged in "channel stuffing" to report inflated sales and income from 1998 to 2000 — wasn’t that the height of the internet bubble, if memory serves? McAfee agreed to pay a $50 million civil penalty and…
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ABN AMRO Gets Whacked Again
For the second time in less than a month, Dutch bank giant ABN AMRO entered into a civil settlement with the federal government over internal failures at the bank. Earlier, the bank settled charges related to its internal controls for money laundering with suspect Russian companies and individuals and agreed to pay an $80 million…
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Using Skilling’s SEC Testimony Against Him
The Wall Street Journal reports (here) that former Enron CEO Jeffrey Skilling and the prosecutors are fighting over whether the transcript of a deposition of Skilling by the SEC can be introduced at trial to show that Skilling was less than truthful in his answers regarding the reasons for a large sale of Enron stock. …
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