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Investigation of Congressman Cunningham Just Got a Whole Lot More Serious
The investigation of Rep. Randy (Duke) Cunningham related to the sale of his San Diego area home in 2003 to Mitchell Wade, a campaign contributor and founder/president of MZM Inc., a small defense contractor, took a decidedly more serious turn on Friday when FBI and IRS agents, along with Defense Criminal Investigative Service agents, executed…
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Enron Defendants Allowed to Subpoena Records From Defense Attorneys About Government Directions Not to Cooperate
U.S. District Judge Sim Lake granted a defense motion made by Enron defendants Ken Lay, Jeffrey Skilling, and Richard Causey — filed ex parte with the court — to permit the issuance of subpoenas under Rule 17(c) to the 15 cooperating witnesses who have entered into agreements with the government to determine whether prosecutors on…
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Does Scrushy Really Want His Old Job Back?
The HealthSouth saga could rival the finest Gothic novels as a Wall Street Journal article (here) states that Richard Scrushy plans to contact large shareholders of the company he founded about reclaiming his position as CEO. Whether or not it is posturing, in the afterglow of the acquittal in the criminal trial, he may feel…
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Judge Bowdre Speaks to the Press
U.S. District Judge Karon O. Bowdre, who presided of the recently completed criminal trial of Richard Scrushy, gave an interview to the Birmingham News (article here) offering — in very general terms — her views on the judicial process during the Scrushy trial. She refused to comment on the lawyers or any of her rulings,…
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Ebbers Agrees to Settle WorldCom Securities Fraud Class Action
Former WorldCom CEO Bernie Ebbers agreed to settle the securities fraud class action with an immediate $5 million payment and to put the rest of his assets into a liquidating trust. Under the terms of the agreement reached with the plaintiff class and approved by the U.S. Attorney’s Office, Ebbers will sell his remaining assets,…
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SEC Charges Stock Tip Service with Fraud
The SEC accused Dr. Terry Allen and his stock service, Terry’s Tips, of securities fraud for making false statements on his website regarding returns from following his "autotrading" options trading program. Among the claims on the website (www.terrystips.com) are the following: Figure Out Your Profit BEFORE YOU INVEST! You can figure the exact profit you…
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NASD and NYSE Try to Come Up with Rules Regulating Entertainment for Mutual Fund Executives
A Wall Street Journal article (here) discusses recent efforts by the NASD and the New York Stock Exchange to come up with rules governing the amount and types of entertainment that brokerage firms can provide to executives at mutual funds. As discussed in an earlier post (here), the SEC is investigating Fidelity Investments, among other…
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Former Bowne & Co. CEO Charged with Possession of Child Pornography and Obstruction of Justice
Robert Johnson, the former CEO of financial information and document management firm Bowne & Co., and also a former publisher of Newsday and member of the New York Board of Regents, was charged with two counts of possession of child pornography and one count of obstruction of justice (indictment here on Findlaw). In May 2004,…
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Rep. Cunningham Receives Document Subpoena in Grand Jury Investigation Into House Sale
The federal investigation of San Diego-area Congressman Randy (Duke) Cunningham’s sale of his home in 2003 to Mitchell Wade, a friend, campaign contributor, and founder of MZM Inc., a Washington D.C. defense contractor, now includes a grand jury subpoena to Rep. Cunningham for his documents related to the sale. As discussed in an earlier post…
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Does the Passport Office Meet the Requirements for Effective Corporate Compliance?
The Corporate Compliance Prof Blog has an interesting post (here) on the FBI’s test of the Passport Office’s control system, and asks whether companies should conduct their own tests of internal corporate control programs. (ph)
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