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EDVA Launches Financial Fraud Task Force

Posted By Ryan J. Reilly On May 21, 2022 @ 1:59 pm In News | Comments Disabled

Neil MacBride, the U.S. Attorney for the Eastern District of Virginia, announced on Friday the formation of a financial fraud task force that could to allow the district to use its reputation as a “rocket docket” to expedite fraud cases.

Neil MacBride (DOJ) [1]

Neil MacBride (DOJ)

The Virginia Financial and Securities Fraud Task Force will consist of representatives from the U.S. Attorney’s office, the Securities and Exchange Commission, the Commodity Futures Trading Commission, the Virginia Attorney General’s office and the Virginia State Corporation Commission. The U.S. Attorney’s office also has an existing working group which consists of representatives from the FBI, U.S. Postal Inspection Service, and the Internal Revenue Service Criminal Investigation Division.

“Corporate fraud scandals have eroded public confidence in the nation’s financial markets,” MacBride said at a news conference in Richmond Friday. “White collar criminals have looted the pocketbooks and retirement accounts of working Americans.  Crimes committed on Wall Street are felt on Main Streets everywhere.”

“The complex financial crimes we confront are national in scope,” MacBride said. “Criminal and civil authorities across the country must utilize every tool possible to prevent and punish fraud. That’s what this task force will do.”

MacBride said that Eastern Virginia has the ability to deal with nearly any fraud case, since nearly all official reports emerging from publicly traded companies are sent to the SEC’s EDGAR computer server in Alexandria, Va.. He also said that the Federal Reserve Bank in Richmond, Va. “is one of the primary hubs for U.S. wire transfers, which is an additional basis for venue in many fraud cases.”

Because of its proximity to Wall Street, the U.S. Attorney’s office in the Southern District of New York has taken the lead on most financial cases.

The new task force could put the Eastern District on the same level as SDNY, although SDNY because of its larger size will likely still occupy the primary role in financial fraud prosecutions. According to a November 2008 Inspector General’s report [2], SDNY had about 260 full-time attorneys in the office in fiscal 2007. By comparison, EDVA had 142.

As of April 2010, 23 U.S. Attorneys offices’ had task forces focusing on mortgage fraud, according to the DOJ.

MacBride said the task force was a step in implementing the goals of the President’s Financial Fraud Enforcement Task Force.

“We have the legal authority to prosecute cases of national significance in the Eastern District of Virginia, regardless of where the fraud occurs,” MacBride said.

Robert Khuzami, the Director of the SEC’s Division of Enforcement, attended the news conference in Richmond and praised the creation of the new task force.

“Financial fraud schemes can be sophisticated, difficult to detect, and span multiple jurisdictions,” Khuzami said. “Opportunities to coordinate civil and criminal law enforcement efforts, such as those provided by this task force, are vital to combating financial fraud.”

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