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Back to Square One with the Scrushy Jury
U.S. District Judge Karon Bowdre sent the jury in the prosecution of Richard Scrushy back to the beginning by replacing a juror, whose recent health problems had caused the jury to miss three days of deliberations, with one of the alternates alternate. Federal Rule of Criminal Procedure 24(c)(3) (here) provides in part that "[i]f an…
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The Parmalat Case
A working paper on the Parmalat case was recently added to SSRN here. It is titled Financial Scandals and the Role of Private Enforcement: The Parmalat Case. Authors Guido Alessandro Ferrarini and Paulo Giudici authored this piece that is described in the abstract as follows: "Coming shortly after the Enron and WordCom scams, the Parmalat…
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Ohio State Professor Convicted of Insider Trading
Dr. Roger D. Blackwell, a professor of marketing at Ohio State University, was convicted of 14 counts of insider trading, conspiracy, and obstructing an SEC investigation into trading in the securities of Worthington Foods through the use of information he gained while a member of the company’s board of directors. Two other defendants convicted were…
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The Mess at MassMutual Will Get Messier
MassMutual fired CEO Robert O’Connell on June 2 after an investigation triggered by a complaint by his wife about an affair he was allegedly having with another executive that came to the attention of the board of directors. The investigation turned up evidence that O’Connell engaged in unauthorized trading in a supplemental compensation account, bought…
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University Dean Pleads Guilty to Wire Fraud
Timothy Van Susteren, a former associate dean at the University of Florida, entered a guilty plea to a wire fraud charge that he diverted $120,000 that was supposed to be paid to the University as support for medical education programs it conduct. Van Susteren had the vendors send the checks to his home and then…
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Former HealthSouth Executives Sentences Vacated
Former HealthSouth CFO Michael Martin– one of the Five Guilty CFOs who testified against former CEO Richard Scrushy — and former senior vice president for tax Richard Botts had their sentences vacated and remanded for resentencing by the Eleventh Circuit in two unpublished opinions that employ the same language and reach identical conclusions (Martin here…
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Krispy Kreme Axes Six Officers in Accounting Investigation
The board of directors of Krispy Kreme Doughnuts Inc. announced that a special committee recommended the termination of six senior corporate officers as part of its continuing internal investigation of accounting problems that have delayed the company’s release of financial statements since last year (see earlier post here). According to a company press release (here),…
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GE Gets Picked for the Finite Insurance Subpoena Team
For those of us who were less-than-stellar athletes, it was always tough waiting to be picked for the playground game. Maybe General Electric felt the same way — although I doubt it — when the U.S. Attorney’s Office for the Southern District of New York began doling out subpoenas as part of its grand jury…
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Vilar Finally Released on Bail
Alberto Vilar, the co-founder of Amerindo Investment Advisers, was released on bail after spending a month in the Manhattan MCC since his arrest on May 26 at the Newark airport on fraud charges. Vilar is well-known for his philanthropic gifts to support the arts, although a grand jury indictment on June 9 charges him with…
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Private Lawyers for the Executive Branch
John Steele has an interesting post on the Legal Ethics Forum (here) about the Department of Justice’s enlistment of private lawyers as the first line of investigation of corporate misconduct. He writes about the new role for these lawyers: "But, quietly and almost unnoticed, some US lawyers have effectively adopted a fifth role: Officer of…
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