Posts Tagged ‘Fraud Section’
Friday, November 5th, 2010

Two attorneys from the Commodity Futures Trading Commission are on detail to the Criminal Fraud Section, a Justice Department official said Thursday, illuminating the DOJ’s efforts to draw on unusual expertise in order to build a deep arsenal against white-collar crime.

“We have forged and fostered strong relationships with our partners in the fight against financial fraud,” Criminal Division chief Lanny Breuer said in remarks at a legal conference on enforcement and the financial crisis.

His team has developed “strong working relationships” with directors at the Securities and Exchange Commission, the Trouble Asset Relief Program’s Special Inspector General — who is tasked with auditing the bailout — and the CFTC, Breuer said.

“Just as important as these leadership-level relationships, strong bonds have also been cemented at the line working level,” he said, referring to the detailed attorneys.

One, Glenn Chernigoff, is helping to prosecute individuals allegedly involved in a $30 million Ponzi scheme who promised investors large returns by trading on the foreign currency market. The other, Luke Marsh, handled cases against hedge funds and others while at the CFTC.

Both joined the section in March; Chernigoff is on a one-year detail, while Marsh will stay for 18 months, a Justice Department spokeswoman said.

The additional manpower comes amidst a series of recruiting coups for the Fraud Section.

Earlier this week it hired former San Diego U.S. Attorney Charles La Bella, who headed a high-profile Clinton-era task force investigating campaign finance violations, to oversee investigations and prosecutions on the West Coast.

The section recruited terrorism prosecutor Jeff Knox from the Eastern District of New York, and hired veteran prosecutors from Manhattan and Philadelphia to oversee its new mortgage and bank fraud unit.

The Justice Department also has ramped up its asset forfeiture program, now run by Jen Shasky and her deputy Jai Ramswamy, an Southern District of New York alum, and boosted the ranks of lawyers reviewing wiretap applications.

Additional reporting by Lisa Brennan.

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Monday, May 17th, 2010

John S. “Jay” Darden, Assistant Chief of the Fraud Section of the Criminal Division at the Justice Department, has joined Patton Boggs LLP as a partner in the litigation department, the firm announced Monday.

John Darden (Patton Boggs)

While at DOJ, Darden supervised the investigation and prosecution of health care fraud and anti-kickback violations. He assisted with the prosecution of German automaker Daimler AG, which settled with the DOJ in April for conspiring to and violating the book-and-records provision of the Foreign Corrupt Practices Act.

His practice will focus on health care fraud and abuse and white-collar crime practices, including FCPA investigations. Darden received the Attorney General’s Award for Distinguished Service for his work on health care fraud prosecutions, the second-highest award given by the DOJ.

“Jay’s keen strategic insight and deep knowledge of how the Justice Department approaches investigations in different areas of the criminal law will help a diverse range of clients overcome allegations of wrongdoing,” Patton Boggs managing partner Stuart M. Pape said in a news release. “We are delighted to have such a talented and experienced prosecutor join our ranks.”

Please send news of moves, promotions and honors to personnelchanges@mainjustice.com.

This story has been updated since it was first posted.

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Friday, December 11th, 2009

A Friday confection for our readers…

Tyrrellgoingaway

You’ll recall that Assistant Attorney General Lanny Breuer, the head of the Criminal Division, told The National Law Journal he was casting around for a “rock star” to replace Fraud Section chief Steve Tyrrell, who announced his intention to leave over the summer.

The quote has been hard to live down, apparently.

Tyrrell, whose last day is Dec. 18, has headed the section since 2006. The outgoing chief has been in job talks with a number of law firms, including Weil, Gotshal & Manges, but has not made a final decision.

Denis McInerney, a partner at David Polk & Warwell and former federal prosecutor in Manhattan, accepted the section chief job last month.

Wednesday, November 25th, 2009

Correction: An earlier version of this post said Tyrrell had decided on Weil, Gotshal & Manges.

Steven Tyrrell, the outgoing chief of the Justice Department’s Fraud Section, said in an interview Wednesday he has been in job talks with a number of law firms, including Weil, Gotshal & Manges. But he said he had not made a final decision.

“I have not received or accepted an offer from any firm. I’ve had extensive discussions with a number of top-tier firms, including Weil, and expect to make a decision very soon,” Tyrrell said.

Tyrrell, who has led the Fraud Section since 2006, announced his plans to leave over the summer. He’s also been in talks with seven other firms.

A 20-year veteran of the department, Tyrrell is expected to leave the department in late December. He has said he intends to help his successor make the transition.

Two people familiar with Tyrrell’s talks told Main Justice that the Fraud Chief was headed to Weil, Gotshal. Tyrrell did not respond to requests for comment on Tuesday and early Wednesday, but after our original story was posted, he clarified that he hadn’t made a final decision.

Denis McInerney, a partner at David Polk & Warwell in New York, accepted the section chief job last week. The Justice Department has not announced his start date.

Tyrrell joined the Justice Department in 1989 as an Assistant U.S. Attorney in the Southern District of Florida, where he handled securities, health care, government contracts, consumer and bank fraud cases. He transferred to the Northern District of New York in 1999, focusing on all manner of white-collar crimes, before coming to Washington. Tyrrell was a Deputy Chief in Counterterrorism Section from 2003 until he took over Fraud.

Tyrrell is leaving as the Fraud section is expanding its might. The department is in the midst of hiring 10 additional trial lawyers, five of whom will be devoted to ferreting out health care fraud. A Justice official said the department is waiting for Congress to pass the 2010 budget before filling some of the posts.

Two other Fraud Section supervisors are planning their exits: Deputy Chief Mark Mendelsohn, who oversees Foreign Corrupt Practices Act prosecutions, and Paul Pelletier, Principal Deputy Chief for Litigation.

Pelletier, the goverment’s lead lawyer in prosecution of Texas Financier R. Allen Stanford, reportedly plans to see the case to its conclusion. Mendelsohn is being courted by many law firms, according to current and former Justice officials, but it’s unclear when he’ll make his decision.

McInerney, a former prosecutor in Manhattan, comes to the job after about 15 years in private practice at Davis Polk, a white-shoe firm based in New York.

He was on the defense team that represented Arthur Anderson in the wake of Enron, taking the lead on law arguments during the six-week trial in Houston, and has represented numerous high-profile corporate clients, including CVS Caremark Corp. and Siemens AG.

He’s also represented victims of Bernard Madoff’s multi-billion dollar Ponzi scheme, and in 1994, he worked alongside Robert Fiske Jr., who served as special counsel in the Clinton-era Whitewater investigation before the appointment of Independent Counsel Kenneth Starr.

Fiske, who is a senior partner at Davis Polk, said McInerney was the second lawyer he recruited for the team. He charged McInerney with preparing a case against three Whitewater figures: Eugene Fitzhugh, David Hale and Charles Matthews.

Though McInerney had little lead time, all three men pleaded guilty — one of them before trial and two during.

“He’s a prodigious worker and he’s extraordinarily thorough,” Fiske said of McInerney. “He leaves no stone unturned.”

McInerney (Columbia, Fordham Law) was an Assistant U.S. Attorney in the Southern District of New York from 1989 to 1994. He was deputy chief of the office’s criminal division from 1993 to 1994.

Thursday, November 19th, 2009

Denis McInerney (DavisPolk)

Denis McInerney (DavisPolk)

Davis Polk & Wardwell partner Denis McInerney has been hired to lead the Justice Department’s Fraud Section, The BLT reports.

He will replace Steven Tyrrell, who announced he was stepping down this summer. McInerney accepted the position on Thursday, according to The BLT.

Assistant Attorney General Lanny Breuer, the head of the Criminal Division,  told The BLT that McInerney brings an “extraordinary career as a lawyer” to the job.

Firm bio below:

Mr. McInerney is a partner in our Litigation Department, representing corporate and individual clients in grand jury and regulatory investigations, criminal and civil trials, internal investigations and general civil litigation.
From 1989 to 1994, he was an Assistant U.S. Attorney for the Southern District of New York, serving as a deputy chief of the Criminal Division from 1993 to 1994. In 1994, he served as an Associate Independent Counsel in the Whitewater Investigation with Independent Counsel Robert B. Fiske Jr.
Mr. McInerney has extensive trial experience as a prosecutor and defense attorney, including his service as Second Chair in the criminal trial of Arthur Andersen in the U.S. District Court for the Southern District of Texas, and as lead trial lawyer for the former Chairman and Chief Executive Officer of an investment bank who was tried on insider trading charges in the U.S. District Court for the Southern District of New York.

Mr. McInerney is a partner in our Litigation Department, representing corporate and individual clients in grand jury and regulatory investigations, criminal and civil trials, internal investigations and general civil litigation.

From 1989 to 1994, he was an Assistant U.S. Attorney for the Southern District of New York, serving as a deputy chief of the Criminal Division from 1993 to 1994. In 1994, he served as an Associate Independent Counsel in the Whitewater Investigation with Independent Counsel Robert B. Fiske Jr.

Mr. McInerney has extensive trial experience as a prosecutor and defense attorney, including his service as Second Chair in the criminal trial of Arthur Andersen in the U.S. District Court for the Southern District of Texas, and as lead trial lawyer for the former Chairman and Chief Executive Officer of an investment bank who was tried on insider trading charges in the U.S. District Court for the Southern District of New York.

Monday, October 19th, 2009

A federal judge has scheduled a retrial for Jun. 21 in the case of Kevin Ring, a former associate of imprisoned lobbyist Jack Abramoff.

Kevin Ring (Getty Images)

Kevin Ring (Getty Images)

U.S. District Judge Ellen Segal Huvelle declared a mistrial in the case on Thursday. Jurors failed to reach a verdict after more than a week of deliberations.

Ring is charged with conspiracy, handing out illegal gratuities and scheming to deprive taxpayers of the honest services of members of the executive and legislative branches. Ring’s lawyers say he was a skilled lobbyist who used legal tools to advance his clients’ interests.

At a hearing today, prosecutors requested a January or February trial date, but Huvelle wanted to wait for the Supreme Court’s review of the scope of the federal “honest services” fraud statute, which was used to charge Ring, The Associated Press reported. The Court is scheduled to hear arguments on Dec. 8.

Friday, October 16th, 2009

Former Bush administration official David Safavian was sentenced on Friday to a year in prison for lying to authorities about his relationship with Jack Abramoff. Read the Justice Department news release here.

David Safavian, who was chief of staff at the General Services Administration, was found guilty in 2006  of obstructing justice and making false statements. He was sentenced to 18 months in prison, but his conviction was overturned by the U.S. Court of Appeals for the D.C. Circuit. After a retrial, he was convicted in December 2008 on the same charges.

U.S. District Judge Paul Friedman said he weighed the need for deterrence against the suffering Safavian’s family had endured in four years of proceeding.

The judge showed some leniency — the government had asked for a sentence of 15 to 21 months — but said Safavian should have known better, National Journal reported.

“Nobody expects you to ever commit another crime,” Friedman said. But “sometime in those two or three years” when Safavian was being investigated for his connections to Abramoff, “a light bulb should have gone off.”

(Click here for The Associated Press story and here for National Journal’s coverage of the hearing.)

Safavian passed Abramoff information about two pieces of government-controlled property the lobbyist sought, and Safavian attended a golfing trip to Scotland largely paid for by Abramoff. The junket came to symbolize the excesses and corrupt dealings of Abramoff and several of his associates.

Safavian was the first defendant in the Abramoff probe to opt for trial. On Thursday, a judge declared a mistrial in the case of ex-Abramoff associate Kevin Ring. Prosecutors said they will try the case again.

Safavian’s case was prosecuted by senior litigation counsel Nathaniel Edmonds and trial attorney Albert Stieglitz Jr. of the Criminal Division’s Fraud Section and trial attorney Justin Shur of the Public Integrity Section. Edmonds was also a prosecutor on the Ring case.

Thursday, October 15th, 2009
Kevin Ring (Getty Images)

Kevin Ring (Getty Images)

UPDATE: 4:40 p.m. Judge Huvelle has declared a mistrial on all counts. When Huvelle asked whether any further deliberation might result in a verdict, the jury foreman answered, simply: “No, your honor.”

Prosecutors made it clear the department will pursue the charges.

“Looks like we’ll be doing this all again,” said Michael Leotta, the Appellate Chief in the U.S. Attorney’s Office for the District of Maryland, before the jury entered the courtroom.

Ring, the first second Abramoff associate to go to trial rather than plead guilty, declined to comment as he left the courtroom.

Huvelle scheduled a status hearing for Monday. Ring’s lawyer, Miller & Chevalier’s Andrew Wise, said he would argue “vociferously” against going to trial in the next 70 days.

He noted the Supreme Court’s decision to take up three cases — including an appeal from former Enron executive Jeffrey Skilling – exploring the scope of the “honest services” law. Ring is charged with depriving the taxpayers of the honest services of employees in the legislative and executive branches of government. The Court’s decision could impact his case and many others.

Assistant Attorney General Lanny Breuer said during a panel discussion Thursday morning that the Justice Department has not instituted a moratorium on the charge pending the Court’s review.

After declaring a mistrial, Huvelle asked the jurors to discuss the case behind closed doors with her and the lawyers.

***

On their eighth day of deliberations, jurors in the trial of ex-lobbyist Kevin Ring, a former associate of Jack Abramoff, told a federal judge Thursday that they are “irrevocably blocked on a final unanimous verdict.”

The disclosure, in a note to U.S. District Judge Ellen Segal Huvelle, comes a day after both prosecutors and Ring’s defense lawyers urged the court to declare a mistrial — a request she declined grant.

However, Huvelle appeared to warm to the idea Thursday, telling the lawyers — absent the jury — that she was thinking of declaring a mistrial on seven of the eight counts Ring faces.

Ring is charged with conspiracy, giving illegal gratuities and depriving taxpayers of the honest services of public officials. Prosecutors say he lavished Justice Department officials, members of Congress and their staff with meals and tickets to concerts and sporting events in return for helping Ring’s clients.

On Tuesday, the jury told Huvelle it had reached a verdict on the eighth count involving a payment of $5,000 to a credit union account controlled by the wife of former California Republican Rep. John Doolittle.

In the intervening days, some of the jurors appear to have had a change of heart. In the note to Huvelle Thursday, the jury foreman said the deadlock was complete.

“We foresee no change in this status after six-plus days of deliberation and think unanimity for this jury is impossible,” the jury foreman wrote.

In a second note to Huvelle, the foreman said the jury had resolved to consider count eight only — but not until after lunch.

We’ll keep you posted.

Wednesday, October 14th, 2009
Kevin Ring (Getty Images)

Kevin Ring (Getty Images)

National Journal is reporting that prosecutors and defense lawyers for Kevin Ring, an ex-associate of Jack Abramoff asked a federal judge to declare a mistrial Wednesday.

The judge, Ellen Segal Huvelle of the U.S. District Court for the District of Columbia, declined the requests and instructed the jury to continue deliberations, which have spanned nearly seven days now.

In a note to Huvelle, the jury wrote, ”We do not see how we can reach a verdict,” according to National Journal.

On Tuesday, jurors told the Huvelle they’d reached a verdict on one of the charges but were stuck on the other seven. (They jury did not reveal the nature of the verdict.) Ring is charged with conspiracy, doling out illegal gratuities and depriving taxpayers of the honest services of public officials.

According to National Journal, prosecutors and defense lawyers said enough was enough.

“Let them go…. Declare a mistrial,” Andrew Wise, Ring’s attorney, said. “This jury has been at it for an extended period.”

“Take the verdict [on the one count], declare a mistrial… and get another trial moving as quickly as possible,” prosecutor Nathaniel Edmonds suggested.

Huvelle said that “given the length of the trial” — about three weeks — “the amount of evidence and the complications of the case,” the jury should continue deliberations.

Ring called for a mistrial last week, after a jury foreman alerted Huvelle to a barred exhibit the government mistakenly included in his evidence binder.

Ring is represented by Miller & Chevalier’s Wise and Timothy O’Toole. The team of prosecutors includes Edmonds, of the Criminal Division’s Fraud Section; Michael Ferrara, of the Public Integrity Section; and Michael Leotta, Appellate Chief in the U.S. Attorney’s Office for the District of Maryland.

Tuesday, October 13th, 2009
Kevin Ring (Getty Images)

Kevin Ring (Getty Images)

The Associated Press has the latest in the trial of Kevin Ring, an ex-associate of imprisoned lobbyist Jack Abramoff. Tuesday was the sixth day of jury deliberations.

Jurors have reached a verdict on one criminal charge and appear deadlocked on seven others in the trial of a lobbyist caught up in the Jack Abramoff influence peddling scandal.

The jury for Kevin Ring decided Tuesday to keep secret its verdict on the one count for now after being directed by U.S. District Judge Ellen Segal Huvelle to resume deliberations Wednesday.

The charge involves a payment of $5,000 to a credit union account controlled by the wife of former California Republican Rep. John Doolittle.

In a note to Huvelle, the second of the day, jurors said that deliberations had been contentious and that arguments had shown no sign of movement toward a verdict, The AP reported. Huvelle told the jurors to continue deliberating.

In the first note, the panel asked Huvelle whether there was a limit on the dollar value of gifts Team Abramoff could give to public officials. (No, she told them.)

Ring is charged with conspiracy, giving illegal gratuities and depriving taxpayers of the honest services of public officials. Prosecutors allege Ring lavished public officials with meals and tickets to sporting events and concerts in return for helping his clients. His lawyers say Ring excelled at his profession, using only legal tools to influence members of Congress, their staff and Justice Department officials.