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Insider Trading by USPS Emplolyee
Advanced copies of Business Week have once again been the source of information for insider trading, this time by a former U.S. Postal Service employee who gained access to the magazine before its delivery to subscribers. Davi Thomas agreed to settle SEC charges that he traded on material nonpublic information gleaned from the magazines, in…
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Whose Evidence Is It Anyway?
As detailed in Tom Kirkendall’s Houston’s Clear Thinkers Blog (which is always an interesting read, especially on Enron developments), the Enron Broadband Services trial (see earlier post here) took a decidedly odd, and potentially devastating, turn when the prosecution’s key witness started to backtrack about what was said at an analysts presentation in 2000. An…
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Welcome to the Business Law Prof Blog
Professor Dale Oesterle from Ohio State, one of the leading corporate, M&A, and securities law professors around, has joined the LawProfs Blog network with the Business Law Prof Blog. His initial post (here) is on the recent indictment of 15 NYSE floor specialists for front-running (trading ahead of their customers to take advantage of prices)…
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Post-Booker Sentence Reviews Under the Guidelines
An Eleventh Circuit opinion in United States v. Crawford (here) considers the government’s challenge to a sentence in a case involving a scheme to defraud the government of over $400,000 from illicit transactions in WIC coupons, specifically the district court’s failure to find "more than minimal planning" under 2F.1.1(the roughly equivalent provision now would be…
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AIG Annnounces Accounting Adjustments from Its Internal Investigation
American International Group issued a statement (here) discussing the accounting adjustments that will be taken as a result of an internal investigation prompted by state and federal regulators inquiring into transactions involving the company. AIG will restate its financials going back to 2000 that will include a $2.7 billion charge to shareholder equity. The statement…
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Killing Two Husbands (Plus a Former Lover) Results in Mail Fraud Convictions
You just don’t see opinions like the Fourth Circuit’s in United States v. Gray (here) every day, or even every year. As if recounting the plot from an episode of Law & Order (preferably one with Jerry Ohrbach), or worse, a law school exam, Josephine Gray told a friend that she had killed two of…
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Key Witness Testifies in Enron Broadband Services Prosecution
Flying largely under the radar, the Enron Broadband Services trial has been going on since mid-April, and the government’s key witness, former Broadband Services co-CEO Ken Rice, is now being cross-examined. Rice and former Broadband Services Chief Operating Officer Kevin Hannon entered guilty pleas to one count of securities fraud and are cooperating in the…
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Former State Department Official Pleads Guilty
A press release of the Department of Justice reports that a "former state department chief consular officer pleads guilty to receiving illegal benefits from foreign nationals." The release states "that Patricia Raikes, a former State Department employee and former Chief Consular Officer at the United States Embassy in Beirut, Lebanon, pled guilty to a one…
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The Steady Stream of Disclosures Continues for AIG
The daily dose of accounting revelations at American International Group is like water torture* for the company, with each disclosure discussing a seemingly new way in which it appears to have manipulated its premiums, quarterly income (see previous post here), and reinsurance risk (think General Re transaction). Today’s example comes via a New York Times…
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Former Homestore.Com CEO Charged with Securities Fraud
Former Homestore.Com CEO Stuart Wolff and executive vice president Peter Tafeen were charged with securities fraud for a scheme to inflate Homestore’s on-line advertising revenues through "round-trip" transactions in which the company recognized income by lending funds to advertising purchasers, who used the money to purchase ads on the firm’s website. The source of the…
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