White Collar Roundup - August 2012

Walk the Line

At the annual CNBC-sponsored Delivering Alpha conference (which is a large conference geared toward hedge funds), U.S. Attorney for the Southern District of New York Preet Bharara sat down with CNBC's Jim Cramer to discuss prosecuting fraud. In the interview, Bharara warned against "getting as close to the line [of illegality] as possible," which can cause "smoke," and "[i]f we see smoke, we have an obligation to investigate." Now That's Take-Out

Everyone knows New York City has plenty of options for take-out. But Southern District of New York Judge Shira A. Scheindlin added an unexpected one by allowing the jurors in a mortgage-fraud trial to take home the indictment to read on their own time "after the beginning of jury deliberations and after receiving various cautionary instructions." On appeal, the Second Circuit affirmed, but warned that "district courts should not make a general practice of sending indictments home with the jury." It's probably best to limit take-out options to pizza, sushi, Chinese food and other culinary fare, instead of indictments, jury charges, evidence and the like. Where Are You Calling From? The Constitution, the Bill of Rights, the Federal Rules of Criminal Procedure and statutes all direct that the proper venue for prosecuting crimes is in the district where the crime took place. But therein lies the rub: Where does a conspiracy occur? According to a Ninth Circuit opinion, a conspiracy occurs in any district in which any participant--including a confidential informant--makes a telephone call to a conspirator, as long as the content of the call was to further the conspiracy and even if the conspirator did not know the confidential informant's location. In its ruling, the court expressly agreed with the Second Circuit, which came to the same conclusion. Winning the Battle but Losing the War In a summary order, the U.S. Court of Appeals for the Second Circuit vacated one count of conviction of former Doral Financial Corporation Senior Executive Vice President and Treasurer Mario S. Levis. At his trial for securities and wire fraud, Levis sought to introduce evidence that the allegedly illegal transactions involved "hedging," but the district court barred that evidence. The Second Circuit disagreed about the relevance of this evidence as to one of the wire-fraud counts and vacated...