Larry Thompson (gov)

Former Deputy Attorney General Larry D. Thompson has returned to the University of Georgia School of Law as a visiting professor starting this semester.

Thompson served as DAG under President George W. Bush from 2001 to 2003. During his time as DAG he headed the Corporate Fraud Task Force and led the Department of Justice’s investigation into the Enron accounting scandal. From 1982 to 1986, he was the U.S. Attorney for the Northern District of Georgia.

After Attorney General John Ashcroft resigned in 2004, Thompson was rumored to under consideration to replace him. Had he been chosen, he would have  become the first black person to head the DOJ. He was also said to be under consideration for the Supreme Court during Bush’s time in the White House.

At Georgia Law, Thompson will teach a course on corporate responsibility. He previously was a visiting professor and lectured at the university.

Thompson is the current senior vice president of government affairs, general counsel and secretary for PepsiCo Inc.

Thompson also was a partner at the law firm King & Spalding in its Atlanta office.

President Barack Obama on Wednesday re-nominated three Justice Department nominees whom the Senate returned last month after adjourning without acting on them.

Obama again tapped James Cole for Deputy Attorney General, Andrew Traver for director of the Bureau of Alcohol, Tobacco, Firearms and Explosives and Denise O’Donnell for Bureau of Justice Assistance director.

The Cole nomination was pro forma. The former DOJ Criminal Division official is already serving as Deputy Attorney General through a recess appointment made by Obama in December after Republicans blocked him in the Senate for five months last year.

James Cole

Because Cole was appointed in a break between two Congresses, he could serve in the position for as long as two years without being confirmed. But if his Republican opponents in the Senate should change their mind about him, his nomination is now officially pending, again.

Traver, a 23-year ATF veteran, also faced opposition while he was a nominee last year.

The National Rifle Association said in a November news release that Traver’s nomination was “ill-advised.” They gun rights organization said Traver, the chief of the ATF’s Chicago office, “has been deeply aligned with gun control advocates and anti-gun activities,” noting his involvement with the Gun Violence Reduction Project, a national program supported by police chiefs, and the Joyce Foundation, which pushes for tighter gun laws.

Andrew Traver

Obama first nominated Traver on Nov. 17, but the Senate Judiciary Committee never acted on his nomination.

The ATF has never had a Senate-confirmed leader, as the gun-regulation agency has been buffeted by the fierce politics surrounding firearms ownership. Temporary appointees have led the ATF since a 2006 law allowed the Senate to confirm the director.

Former Massachusetts U.S. Attorney Michael Sullivan was the last nominee for ATF Director. But Senate Republicans held up the President George W. Bush nominee over worries about the ATF’s handling of small-gun owners. Sullivan was acting Director from 2006 to 2009.

Acting Director Kenneth Melson has led the agency since 2009.

O’Donnell, meanwhile, flew under the radar during her nine-day stint as a nominee last year. She wasn’t nominated until Dec. 13 and didn’t have time to come before the Senate Judiciary Committee.

Previously the New York State Deputy Secretary for Public Safety, O’Donnell resigned last year after a newspaper report that New York Gov. David Paterson (D) inappropriately interceded in harassment allegations concerning one his staffers.

O’Donnell also was the U.S. Attorney for the Western District of New York from 1997 to 2001. She joined the office as an Assistant U.S. Attorney in 1985.

The nominee would replace acting Director James H. Burch II, who has led the bureau since Domingo S. Herraiz resigned in 2009.

Attorney General Eric Holder on Monday announced that Gary Grindler will be his new chief of staff.

Gary Grindler (photo by Ryan J. Reilly / Main Justice)

Grindler served as acting Deputy Attorney General following the departure of David Ogden from the post last February. He stepped down as the No. 2 official at the Justice Department on Monday when President Barack Obama installed James Cole as Deputy Attorney General through a recess appointment. Grindler will begin his new job on Jan. 17.

Kevin Ohlson

He will replace Kevin Ohlson as chief of staff. Ohlson will return to his career service with the DOJ.

“Kevin Ohlson has been an extraordinary public servant through a long career at the department, and while I am sorry to lose him from my office, I am grateful for his tireless work leading my staff the past two years,” Holder in a statement.

He added, “As he has throughout his career, Gary Grindler showed remarkable leadership under difficult circumstances as Acting Deputy Attorney General over the past year, and I could not be more pleased that he has agreed to continue that service in this new role as my chief of staff.  He will continue to be a key leader in our work to protect the American people, ensure the fairness and integrity of our financial markets, and invigorate the traditional missions of the department.”

Grindler is a DOJ veteran, who has had two stints at the Department. He started his most recent stint at the Department in March 2009, serving as a deputy in the Criminal Division under Assistant Attorney General Lanny Breuer.

He returned to the DOJ after spending nine years at King & Spalding, working on government and corporate

Grindler previously served in a number of other roles at the DOJ, including Principal Associate Deputy Attorney General, Counselor to Attorney General Janet Reno and Deputy Assistant Attorney General in the Civil Division. He was also an Assistant U.S. Attorney in the Southern District of New York and the Northern District of Georgia.

James Cole was sworn in on Monday as the new Deputy Attorney General.

Although Cole was nominated in May and was approved by the Senate Judiciary Committee in July along a party-line vote, his nomination was returned to President Barack Obama late last month. However, Obama  appointed Cole to the position one week later, installing him while Congress was in recess.

Attorney General Eric Holder said, “I am pleased to welcome Jim back to the Department of Justice,” adding,  “He will be critical in our work to keep the American people safe, ensure the fairness and integrity of our financial markets, and restore the traditional missions of the Department.”

Cole’s nomination became controversial among Republicans. They centered their concerns on Cole’s work as an independent monitor for insurance giant AIG, which the Federal Reserve bailed out during the 2008 financial industry crisis, and a 2002 article Cole wrote endorsing civilian trials for terrorism suspects.

In a Sunday blog posting, the Washington Post’s Jennifer Rubin came down hard on Cole. She wrote that Republican lawmakers “this week will continue to decry the recess appointment of James Cole … but the question here is Cole’s fitness to serve.” She went on to assert that “there is reason for Republicans and Democrats alike to be deeply concerned over the appointment,” despite the fact that he only will hold the position for one year. The DAG, she write, “can do quite a lot of harm in 12 months.”

She cited comments from Senator Jeff Sessions of Alabama, the judiciary panel’s leading Republican, about several positions Cole’ has taken and possible conflicts of interest.

Rubin concluded, “The question remains: why would the president and the attorney general select Cole from among all the qualified attorneys in the country to fill the number-two spot in the Justice Department?” She added, “It would seem both Cole and Eric Holder should do some explaining, under oath, once Congress reconvenes.”

James Cole (photo by Channing Turner / Main Justice)

The Senate Judiciary Committee endorsed Deputy Attorney General nominee James Cole at its meeting Tuesday.

The panel voted, 12-7, along party lines to report his nomination out of committee. The committee initially scheduled a vote for Cole last Tuesday. But his nomination was held over at the request of panel Republicans. Committee members can request to hold over a nominee one time.

GOP members expressed concern with Cole’s support for trying terrorism suspects in civilian courts and his tenure as an independent monitor for insurance giant AIG, which the Federal Reserve bailed out during the economic crisis in 2008.

“I’m concerned about Mr. Cole’s ability because in his position as Deputy Attorney General, he would be in a position to influence future compliance monitors appointed under settlements between Justice Department, [Securities and Exchange Commission] and other corporations that have violated the law,” said Sen. Charles Grassley (R-Iowa).

Sen. Benjamin Cardin (D-Md.) said the nominee did not have the authority under the terms of the deferred prosecution between AIG and the Justice Department to evaluate the economic strength of the company’s business decisions.

“I think we need to look at the entire record here,” Cardin said. “Obviously none of us are proud of what happened at AIG. But I don’t think we should have guilt by association because someone tried to take on the challenges and help the situation.”

Panel Chairman Patrick Leahy (D-Vt.) urged his colleagues to move quickly on the nomination, noting the Senate’s consideration of George W. Bush administration Deputy Attorneys General Larry Thompson, James Comey, Paul McNulty and Mark Filip.

McNulty was the only Deputy Attorney General in the group who was not confirmed within three months of his nomination. He was confirmed after a little more than four months.

President Barack Obama nominated Cole in May to replace acting Deputy Attorney General Gary Grindler, who has held the post since David Ogden stepped down in February.

This post has been updated from an earlier version.

If James Cole is confirmed as Deputy Attorney General, he will help lead the Justice Department’s national security team, which has struggled over how to prosecute terrorism defendants — in civilian courts or military tribunals.

Cole is not known as a terrorism expert, having spent most of his career as a white collar crime prosecutor or defense lawyer, but in an eight-year-old op-ed, he expressed confidence that the civilian criminal courts could adequately handle even the most extreme terrorist cases, including the Sept. 11, 2001 attacks.

That view may not sit well with some Republicans on the Senate Judiciary Committee, which begins hearings on Cole’s nomination on Tuesday. Some Republicans have advocated wide use of military proceedings to try terrorism suspects.

In a Sept. 9, 2002, opinion piece for Legal Times, Cole wrote:

[T]he attorney general is not a member of the military fighting a war — he is a prosecutor fighting crime. For all the rhetoric about war, the Sept. 11 attacks were criminal acts of terrorism against a civilian population, much like the terrorist acts of Timothy McVeigh in blowing up the federal building in Oklahoma City, or of Omar Abdel-Rahman in the first effort to blow up the World Trade Center. The criminals responsible for these horrible acts were successfully tried and convicted under our criminal justice system, without the need for special procedures that altered traditional due process rights.

Our country has faced many forms of devastating crime, including the scourge of the drug trade, the reign of organized crime, and countless acts of rape, child abuse, and murder. The acts of Sept. 11 were horrible, but so are these other things.

Cole, writing at a time when John Ashcroft was Attorney General, added that “the attorney general justifies much of his agenda by pointing to the ‘war on terrorism’ and saying that it is an extreme situation that calls for extreme actions. But too much danger lies down the road. The protections built into our criminal justice system are there not merely to protect the guilty, but, more importantly, to protect the innocent. They must be applied to everyone to be effective. What are we fighting for if, in the name of protecting the principles that have raised this nation to the pinnacle of civilization, we abandon those very principles?”

This post has been corrected.

Deputy Attorney General nominee James Cole has a net worth of more than $7 million, according to a financial disclosure form he provided to the Senate Judiciary Committee.

Cole reported that his assets include $1.2 million in securities and $4.4 million in real estate, including his $1.13 million residence and $3.3 million summer home (which includes both a house and three other lots). He has $426,224 in cash on hand, he reported.

His client list between 2008 until this year included:

• American International Group
• Avaya, Inc.
• Clayton Lewis (Seattle)
  
• Sandford Rosenblum (Albany, N.Y.)
  
• Tobii Technology
• Timothy Webster (Mission Hills, Kansas)
• Charles Brimmer (Arlington, Va.)
  
• Carlos Cano (Washington, D.C.)
  
• John Cutter (Raleigh, N.C.)
  
• International Medical Corps
• Pediatria Healthcare LLC
• Tony F. Sanchez III (Las Vegas)
  
• Michael Segal (Highland Park, Ill.)
  
• Richard Seigal (deceased)
• Thomas Sjoblom (Great Falls, Va.)
  
• Anchin, Block & Anchin
• Alticor, Inc.
• John McLaughlin (Washington, D.C.)

An earlier version of this post incorrectly stated that Cole’s net worth was $7.2 million. His net worth is $7 million.

The full financial disclosure form is embedded below.

JamesCole-PublicQuestionnaire-FinancialDisclosure

The Senate Judiciary Committee will hold hearings on Deputy Attorney General nominee James Cole on June 15, less than a month after he was nominated, Chairman Patrick Leahy (D-Vt.) announced Tuesday.

James Cole, a former public corruption prosecutor who in the 1990s investigated House Speaker Newt Gingrich (Bryan Cave).

Cole, a longtime friend of Attorney General Eric Holder, was nominated by President Barack Obama on May 24. Republicans are expected to raise issues with his work as a government-imposed monitor at insurance giant AIG.

In responses on  his Senate Judiciary Committee questionnaire, Cole said in notes for a speech that he was “not received as a member of the family” when he began his work as a monitor at AIG in 2005.

“As I began to talk to people, some were quite anxious to have me do my review, but many didn’t want me to interfere with the ‘entrepreneurial culture’ at AIG,” wrote Cole.

In his answers on the questionnaire, Cole wrote that he represented a senior Enron officer during government investigations into CEO Kenneth Lay. He also wrote that from 2003 to 2007, he represented Prince Nayef bin Abdel Aziz, the Minister of the Interior of Saudi Arabia, in litigation brought by victims of the Sept. 11, 2001 attacks, a case which was dismissed. Cole said that he has performed no lobbying activities.

A Justice Department spokeswoman had no immediate comment on the scheduled hearing.

UPDATED:

In the midst of preparations for the hearing next week, Cole visited the Justice Department on Tuesday afternoon. Cole was headed to Capitol Hill for meetings with senators and is scheduled to be back on the Hill Wednesday.

Senate Judiciary Ranking Republican Jeff Sessions of Alabama and Deputy Attorney General nominee James Cole.

When Deputy Attorney General nominee James Cole appears before the Senate Judiciary Committee for his confirmation hearing, Republicans plan to question him on his work monitoring insurance giant American International Group (AIG).

“How he performed at that job is directly relevant to his qualifications and will need to be closely examined,” Sen. Jeff Sessions (R-Ala.), Judiciary’s ranking Republican, said in a statement sent out shortly after Cole was nominated on May 21.

Cole’s work as a monitor began in 2005 - a full three years ahead of the company’s near collapse in 2008 - and he was still on the job as of last week. The Justice Department has not discussed his work at AIG, but several Cole allies said it was unfair to blame him for the company’s problems.

But what exactly was Cole’s role at AIG, which received $180 billion in federal bail-out assistance and became a symbol of the excess and recklessness behind the financial meltdown?

In 2004, the Justice Department’s Fraud Section chose Cole from a pool of three candidates selected by AIG to be an independent monitor as part of a deferred prosecution agreement. Under the terms of the agreement, DOJ agreed to hold off on prosecuting AIG for selling financial products that companies used to create the appearance of financial strength. Prosecutors agreed not to pursue criminal charges against the company if it complied with reforms and paid millions in fines.

Cole, a former deputy chief of the DOJ’s Public Integrity Section and special counsel to the House ethics committee that investigated then-Speaker Newt Gingrich (R-Ga.) for misuse of tax exempt organizations, was, by the time of the deferred-prosecution arrangement, working at the law firm of Bryan Cave LLP.

In January 2005, he took on a senior role in overseeing AIG’s dealings, investigating financial transactions dating back to 2000 that allegedly allowed AIG to manipulate earnings statements. His role was expanded in 2006, when AIG reached a separate agreement with the Securities and Exchange Commission to settle an inquiry into accounting irregularities and allegations of bid rigging. Cole was assigned to oversee corporate governance and take a look at their controls on financial reporting.

Cole’s firm earned fees of about $20 million for its work as a compliance monitor, according to The Wall Street Journal. Some of the transactions Cole examined had been structured by AIG’s Financial Products group, the same unit that would later write billions of dollars worth of credit default swaps that almost destroyed the company and forced the government into a costly rescue deal fearing the potential damage to the overall economy.

As a monitor, Cole regularly attended AIG Board of Directors committee meetings, including at least two February 2008 meetings where board members were told of findings of “material weakness” in the company’s accounting systems that were uncovered by auditors at PricewaterhouseCoopers LLP, the Journal reported.

A Bryan Cave representative declined to comment on Cole. Calls to Cole were referred to the White House. A Justice Department spokeswoman also declined to comment. Sessions’ office did not return calls seeking comment. Cole told The Wall Street Journal in 2009 that an agreement with AIG prohibits him from making any public comment on his work.

Recently, AIG has been back in the news with reports that the Justice Department has decided not to bring criminal charges after a two-year inquiry into AIG’s senior executives, including Joseph Cassano, the former CEO of the AIG Financial Products unit. Prosecutors were examining whether Cassano misled investors in 2007 when he said the group’s obligations on the mortgage securities it backed were unlikely to produce losses. Justice Department officials have so far said nothing publicly about the investigation.

Now that his nomination has been announced, a person familiar with Cole’s current activities said “he’s in [the] process of transitioning [out of his law] practice.”

It will likely be several months before Cole’s hearing, though no time frame has been set. That long lead time may work against him, giving his critics plenty of time to closely examine his record overseeing AIG.

Critics say Cole, who has been picked for a critical DOJ job that requires a kind of radar to detect issues might prove troublesome, should have been more attentive to possible financial misdeeds and highly risky deals.

“It’s as though Cole were spackling cracks in the compliance walls and never noticed that AIG’s financial foundation was crumbling beneath his feet,” wrote Corporate Counsel in July 2009.

The Government Accountability Project, a nonprofit watchdog group, also has said that Cole didn’t ask enough questions leading up to the financial meltdown that nearly consumed AIG.

“Cole came into AIG as the independent monitor like an anti-fraud typhoon, meeting with the relevant people and overseeing about 35 different work streams,” Beatrice Edwards, GAP’s International Reform Director, wrote in a blog post criticizing his nomination. “But gradually… he seemed to weaken and adapt,” Edwards said sources told her. “Cole failed to detect an atmosphere of, shall we say, laissez faire compliance at the company.”

But Cole’s defenders are quietly mounting a defense of his work for AIG, saying privately that he isn’t to blame for what happened at the insurance giant. Few Cole allies were willing to publicly discuss the specifics of his role. Several people familiar with Cole’s oversight of AIG said that though Cole was assigned to monitor accounting driven investment practices, his work did not specifically include the major issue that nearly led to the company’s demise — namely credit default swaps.

A credit default swap (CDS) is a type of financial transaction that acts as a form of insurance in case of default. For example, AIG sold thousands of credit default swaps to banks and investment firms on real estate bonds. For a fixed quarterly payment, AIG guaranteed that if a bond issuer defaulted, AIG would pay the CDS buyer the face value of the bond.

Supporters of Cole have suggested that since many financial experts missed the underlying problem of credit default swaps in the years leading up to the financial crisis, a lawyer like Cole — who was broadly overseeing the complex conglomerate’s transactions — could not have been expected to have foreseen the problem, either.

Thomas Hanusik, a partner at Crowell & Moring LLP, who had been the lead prosecutor on an AIG investigation before he left the Justice Department in January 2006, said he had the “utmost respect” for Cole and that he was “incredibly thorough” in his oversight work.

A White House official agreed that Cole’s work as a monitor would not have covered the issue of credit default swaps.

Others in the legal community from both sides of the docket praised Cole as professional, ethical, credible, and a skilled advocate and highly regarded.

But on Capitol Hill, his reputation can only get him so far, particularly when Republicans seem prepared to contest many of the president’s nominees. Cole was well paid as the government’s cop on the beat at AIG, and his job was to impose tough managerial controls and financial discipline at the company. But instead of achieving stability, AIG nearly buckled under the weight of its high-risk financial practices that continued while Cole was its monitor.

Republicans appear ready to attack his association with the much-vilified AIG, and could demand to see the full reports he issued to AIG, which have so far been kept from public view.

The Justice Department has already send Cole’s reports on AIG to the House Oversight Committee, according to committee spokesman Adam Hodge. The documents were requested in a letter last April by House Oversight and Government Reform Committee Chairman Edolphus Towns (D-N.Y.) and Ranking Republican Darrell Issa of California to Attorney General Eric Holder. The reports were only handed over under the threat of a congressional subpoena, and the committee has not made the documents publicly available.

A Democratic Judiciary Committee aide said Democrats weren’t sure whether Cole would be required to disclose the full AIG monitoring reports as part of the hearing for his nomination.

Congress has taken a look at Cole’s work on AIG before in the form of a 2009 Congressional Research Service report issued at the request of the House Oversight Committee. His mission as independent consultant, notes the report, “did not include investigation of past misconduct.”

Three reports issued during Cole’s tenure as monitor in August and September of 2007, “are entirely forward looking; they set out a range of best practices that encompass virtually all of the company’s compliance and reporting obligations” the CRS report said. “It is almost as though the Independent Consultant assumed that AIG had no internal compliance or accounting systems whatsoever and proceeded to draw them on a blank slate,” according to the report.

As of April 2008, just months ahead of the near collapse, AIG had accepted virtually all of Cole’s recommendations with just minor modifications, according to the CRS report. In a May 15, 2022 report, Cole wrote that “AIG had worked diligently and deserves commendation for its efforts to date,” according to CRS. Cole’s Aug. 15, 2008 report was not in general critical of AIG’s implementation efforts, but the report graded its compliance in the area of records keeping as “off-track.”

After the September 2008 financial crisis, Cole’s Nov. 15, 2008 report began by noting that “AIG has entered into what can only be described as a crisis scenario.” The recommendations he made for AIG were placed on hold, and Cole said he intended to meet with AIG every two months to determine whether the company were stable enough to continue implementation of his recommendations.

Cole’s role at AIG was narrowed after the government bailout in 2008, but he issued a report in March 2009 that concluded the failure to treat credit default swaps as “significant” or “non-standard” transactions created “a gap that we recommend be closed,” according to the CRS report.

The Obama administration is vetting James Cole, a former public corruption prosecutor who in the 1990s investigated House Speaker Newt Gingrich, for the Justice Department’s No. 2 position, according to two people with knowledge of the matter.

Cole, 57, has told several lawyers in Washington that he has been preparing paperwork for the nomination process. He declined to comment.

The search for a Deputy Attorney General has been ongoing since David Ogden announced in December he was stepping down in February. Even if the president decides on Cole, who was a federal prosecutor for 13 years, his nomination would likely be delayed until after the confirmation of Justice John Paul Stevens‘ successor.

Spokesmen for the White House and the Justice Department declined to comment.

Cole, a partner at Bryan Cave LLP, joined the Justice Department in 1979 as a trial lawyer in the Criminal Division’s Public Integrity Section — where he befriended now-Attorney General Eric Holder - and left in the 1990s as Deputy Chief. He also served as chief of staff for the special counsel who investigated the House banking scandal.

While in Public Integrity, Cole successfully prosecuted Robert Collins, then a U.S. district judge in New Orleans, who was convicted in 1991 of accepting $100,000 in bribes from a drug dealer awaiting sentencing.

Cole also prosecuted former Rep. George Hansen (R-Idaho) for making false statements on his financial disclosure forms. Hansen went to prison for 15 months but his conviction was overturned by the Supreme Court.

Cole earned bipartisan praise as outside counsel to the House ethics committee in the Gingrich investigation, which focused on the Georgia Republican’s use of tax-exempt funds. The probe was a factor in Gingrich’s decision to resign from Congress after the November 1998 elections.

More recently, Cole served as monitor to American International Group Inc. as part of a $126 million settlement reached in November 2004 between AIG, the Justice Department and the SEC.

The Wall Street Journal reported in April 2009 that AIG had paid Cole and his firm $20 million to oversee business practices at the insurer.

Cole would replace Gary Grindler, who has served as acting Deputy Attorney General since Ogden’s departure.

EDITOR’S NOTE: After Main Justice published this story, we became aware that the non-profit journalism Web site ProPublica had also published a story about an hour and 15 minutes earlier. ProPublica was not the source of our story, which we confirmed through independent reporting earlier in the day on Monday.