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Another One Rides the Fifth Amendment Bus
Former General Re CEO Ronald Ferguson asserted his Fifth Amendment privilege rather than testify in the SEC and DOJ investigation of AIG-General Re reinsurance transactions, and promptly lost his consulting contract with Berkshire Hathaway. Ferguson was CEO of General Re when Berkshire Hathaway acquired the company in 1998, and left that position in 2001 when…
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NASD Funds Study About Why Investment Scams Target the Elderly
A story in the North County Times (San Diego) discusses the NASD’s funding of a study to analyze why the elderly are the targets of investment scams. George Chamberlin sums it up (here): "I could have saved these guys a lot of money. The reason the elderly are targeted for investment scams is the same…
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Lawyer Representing Former Executive in Criminal Case Removed for Conflict Arising From Prior Representation of Corporation
Former Westar Energy executive Douglas Lake, who will be retried along with former Westar CEO David Wittig, lost a member of his defense when the U.S. District Court Judge Julie Robinson disqualified Nick Badgerow on conflict of interest grounds. Badgerow represented Westar in 2003 in litigation that came up in the first criminal trial, which…
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Everything in Birmingham, Alabama Isn’t Scrushy
While the jury will continue to deliberate on the charges pending against Richard Scrushy, after questioning the judge as to what happens if they all can’t agree (see AP in Birmingham News here), another case has concluded. This case involved charges against two former HealthSouth employees and the verdict was Not Guilty. The case…
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Keep Politics Out Of Courts
The trial of fundraiser David Rosen (fundraiser for Hillary Clinton) has not been going very well for the government. According to the NYTimes, here, the judge is considering tossing out one of the counts in the case. The other counts sound like they also have significant issues for the government. One has to wonder how…
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First Sentences Handed Down in Philadephia Corruption Trial
U.S. District Judge Michael Baylson imposed sentences on two defendants, both of whom entered guilty pleas, in connection with the Philadelphia corruption trial on Friday. Former Philadelphia Treasurer Corey Kemp’s pastor, the Rev. Francis McCracken, admitted that he and Kemp diverted $50,000 from a bank loan to his church for repairs after it was struck…
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New York Begins Grand Jury Investigation of AIG Executives
A Wall Street Journal article (here) reports that N.Y. Attorney General Eliot Spitzer’s office has begun presenting evidence to grand jury about possible criminal violations by former American International Group executives in connection with accounting issues at the insurance company. The targets of the investigation at this point are most likely former CEO Maurice Greenberg…
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Blame the Messenger
Things at venerable Wall Street investment bank and brokerage firm Morgan Stanley aren’t going particularly well these days. There is a fight between the old guard from the investment banking side of the firm (called the "Group of 8") seeking the ouster of CEO Phillip Purcell, who comes from the brokerage side of the firm…
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Corruption and Obstruction in Margaritaville
The former Monroe (FL) County Attorney, James Herrick, was added to a superseding indictment for alleged obstruction of justice, conspiracy to obstruct a federal grand jury, and two counts of witness tampering in connection with concealing an alleged $29,000 kickback paid to former Monroe County Commissioner and Mayor Jack London. The payment was related to…
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Energy Trader Pleads Guilty to Manipulating Natural Gas Prices
A second energy trader working for The Williams Cos. entered a guilty plea in the Northern District of California to submitting false trade information to a publication in order to manipulate the price of natural gas (7 U.S.C. Sec. 13(a)(2)). Brion McKenna, formerly an energy trader with Williams Energy Marketing & Trading in Tulsa, admitted…
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