In the Public's Benefit - Installment 2011-1

Brooklyn, New York, lawyer Jason Goldfarb, 32, admitted today to taking part in what the U.S. says is one of three Galleon Group LLC insider-trading rings. Goldfarb, pled guilty to conspiracy and securities fraud before U.S. District Judge Richard Sullivan in Manhattan.

Goldfarb (Brooklyn Law School) was accused of conspiring with ex-Galleon trader Zvi Goffer to pay tens of thousands of dollars to Arthur Cutillo and Brien Santarlas, lawyers at Boston-based Ropes & Gray LLP, for information about transactions their firm was working on.

As part of the plea agreement, Goldfarb won’t be prosecuted further by the U.S. Attorney’s Office for the Southern District of New York, except for any potential criminal tax violations, according to a copy of the pact.

Goldfarb's plea raised to 20 the number of defendants who've done so in what authorities call the largest hedge fund insider trading case ever.

Goldfarb was arrested in 2009 in connection with the Galleon Group hedge fund prosecution. Galleon's founder, Raj Rajaratnam, is currently trial now. Prosecutors claim the Wall Street insider used "corporate spies" to get rich off inside trades. He insists he was merely a savvy investor.

According to Wikipedia (today), Federal Election Commission records indicate Rajaratnam made over $75,000 in political contributions in the past five years. He has also contributed to the Democratic National Committee and various campaigns on behalf of Hillary Rodham Clinton, Charles Schumer, and Robert Menendez.


....................................................^ ^ ^

Why pick on law schools?

Law schools do not seem to compete for the public's benefit; school reputations currently connote to the public vague expectations of how brazen and arrogant their graduates may behave, rather than the innate integrity of their respective graduates.

Improving law school admissions standards, although certainly in the public interest, is highly unlikely. After all, law schools are not military academies and most lawyers were never Eagle Scouts nor recipients of Girl Scout equivalent Gold Awards.

Why pick on lawyers?

A disproportionate percentage of law graduates (hardly 2% of the entire workforce) are currently elected to over 20% of public offices (including 60% of the U.S, Senate and 100% of the U.S. Supreme Court). This presents conflicts of interest and publicly unintended concentrations of authority. Combined with self-serving laws tailored to give incumbents subtle advantages over challengers, the country is in growing peril of a permanent political class.

Meanwhile, proceeds of the underlying crimes are certainly adequate to provide corruptive influences in government at every level.

Flagrant Abuse and/or Quid Pro Quo?

Would this payback smell so bad for a profession other than lawyers? There can be little doubt that it would.

Background

Of the twenty top donors to President Obama during his 2008 election cycle, 4 organizations were law firms who funnelled money from the organizations' PACs, partners or employees and subsidiaries. Each of the four law firms contributed in excess of $490,000 according to OpenSecrets.org.

.

In addition, 4 universtiies with renowned law schools (Harvard, Columbia, Stanford and the University of California) contributed over $520,000 each. Finally, our US Government, not quite as rife with atttorneys at the time as today, funnelled about $500,000.

In summary, 8 of Obama's top 20 donors including the largest (the University of California with $1,591,395) are tied overtly to the legal profession.

Middle Class Quid Pro Quo?

The Department of Labor has more attorneys than any other department besides the Department of Justice, sources note. VP Biden says that this new ABA government program is part of his Middle Class Initiative.

In an unprecedented and controversial move, the White House has launched a new program at the Department of Labor which will refer workers who havecomplaints about their bosses to a toll free number at the American Bar Association, where they can get a lawyer to work on their case on a contingency fee basis. ...

The White House has also enlisted the ABA to launch a toll-free hotline number at the Department of Housing and Urban Development to help homeowners with foreclosure issues, as well as a separate ABA toll free number to help veterans at the Department of Veterans Affairs, too.

Vice President Joe Biden noted that the lawyers will be working on a contingency fee basis, and not pro bono. Joy, middle class!

No Disbarment Applies #2

Since May 26, 2005, the following quotation has appeared above in Lawyer Kickers pro bono's header:

Well-connected local people probably don't get prosecuted as much. That's just endemic in government, including lawyers and judges. People don't like to prosecute their friends. - Professor John Corkery of the James Madison Law School in Chicago

By way of a possible example, last month we posted No Disbarment Applies, a rather convoluted result by the Board on Professional Responsibility on whether a lawyer who, by pleading guilty in 2005 to making a false entry in financial records (a federal record-keeping crime), violated D.C.’s moral turpitude law. The board found on December 09, 2010, that violating the federal law did not, on its face, run afoul of the D.C. moral turpitude law.

Any citizen harboring reservations about that outcome, may be a bit more concerned with one handed down more recently.

January 13, 2011 D.C. Appeals Court: Attorney May Have Stolen Funds, But Doesn’t Deserve Disbarment, in which Exceptional Circumstances were cited in accordance with:

We have said that even where a lawyer has engaged in intentional misappropriation of funds, a sanction less than disbarment may be appropriate "in extraordinary circumstances," Addams, 579 A.2d at 191, or "[o]nly in the most stringent of extenuating circumstances," id. at 193 (quoted in In re Pennington,921 A.2d 135, 141 (D.C. 2007)). Previously we have found "extraordinary circumstances" only where the respondent's misconduct was shown to be caused by a disabling addiction, such as chronic alcoholism, see In re Kersey,520 A.2d 321, 326-27 (D.C. 1987), or depression, see In re Verra,932 A.2d 503, 505 (D.C. 2007). We have not otherwise defined what will constitute "extraordinary circumstances," but have noted that "it is appropriate for the court to consider the surrounding circumstances regarding the misconduct and to evaluate whether the mitigating factors are highly significant and [whether] they substantially outweigh any aggravating factors such that the presumption of disbarment is rebutted." Addams, 579 A.2d at 195.

Lawyer Hewett, who was represented by Ronald Douglas, assistant dean for student services at North Carolina Central University School of Law, argued that disbarment was not appropriate because there was no “evidence of fraud, self-dealing, misrepresentation, conflict of interest, or any pattern of inappropriate conduct.”

“[A]lthough we agree with Bar Counsel that Willie Hewett intentionally misappropriated funds, we conclude that the facts of this case – in particular that the motivation for the misappropriation was protection of the client’s interest – present the type of “extraordinary circumstances” in which disbarment is not the appropriate sanction,” Judge Vanessa Ruiz wrote.

RESULT: A six-month suspension stayed in favor of probation was determined more fitting punishment than outright disbarment. Ruiz also ordered Hewett to reimburse Jewell’s estate in the amount of interest accrued while he was in possession of the misappropriated funds.

Lawyer Kickers pro bono sees a pattern of inappropriate conduct. Consider whether a neighbor, relative or non-lawyer of the veteran (client) had committed the same misappropriation of funds from the veteran as the lawyer and claimed the same extraordinary intention: to deplete the veteran's bank account to maintain Medicaid eligibility.

a) If the extraordinary circumstances rule is unobtainable by non-lawyers, separate law applied to lawyers only seems to hold their misappropriations above the law applicable to ordinary citizens.

Or, on the contrary...

b) If courts allow the lawyer's precedent to apply to similar misappropriations by ordinary citizens, the decision creates a defense for theft because fraud, self-dealing, misrepresentation, and conflict of interest are difficult to prove.

Either way, the lawyer's conduct seems to involve an inappropriate pattern for the community by an officer of the court (role model of respect for the law).

Latest Leaker

Back in 2006, we had quoted Howell Raines, former executive editor of the New York Times, who shared some tantalizing, insiders' knowledge with an audience at the Aspen Institute, an international organization dedicated to "fostering enlightened leadership, the appreciation of timeless ideas and values, and open-minded dialogue on contemporary issues."

When one audience member asked Raines about the role of media leaks, Raines offered up some arcane information of his own::

"Almost all leakers are lawyers. That's the bottom line."

We have not attempted to compile the law degree status of every leaker since 2006, but we have checked the latest:

WASHINGTON- Thu Jan 6, 2011 4:27pm EST by James Vicini (Reuters) Ex-CIA officer charged with giving reporter secrets - A former CIA officer was arrested on Thursday on charges of illegally disclosing national defense information about Iran to a New York Times reporter who wrote a book.

Sterling, a lawyer who worked at the CIA from 1993 to 2002, was arrested in St. Louis near where he lives.From 1998 through mid-2000, he was assigned to a classified clandestine program that conducted intelligence activities about the weapons capabilities of certain countries, the Justice Department said in announcing the indictment against Sterling.

Perhaps the CIA's Security Section should take more of an interest in reading our 2006 posting. Oh, well. We realized it is currently politically incorrect to avoid grief by rational means. Unfortunately, resultant grief always adds job security for members of the bar.

No Disbarment Applies

Since the May 26, 2005, inception of Lawyer Kickers pro bono, the following quotation has appeared above in our header:

Well-connected local people probably don't get prosecuted as much. That's just endemic in government, including lawyers and judges. People don't like to prosecute their friends. - Professor John Corkery of the James Madison Law School in Chicago

...............................................................................................
Readers may find the following outcome interesting, if not credulity-stretching.

It involves a lawyer who, by pleading guilty in 2005 to making a false entry in financial records, avoided retrial on securities and bank fraud charges. Adelphia Communications Corporation founded by his father went bankrupt after the father and another son pilfered millions of dollars from the company and hid its debt from investors, prosecutors had alleged.

Father and son Timothy were convicted in June 2005. The father was sentenced to 15 years in prison. Timothy received a 20-year sentence. They lost an appeal in 2007.

Following the plea of the second son, a lawyer named Michael, the Court of Appeals in 2005 ordered the Board on Professional Responsibility to investigate whether he had violated D.C.’s moral turpitude law when he committed the federal record-keeping crime. The board found that violating the federal law did not, on its face, run afoul of the D.C. moral turpitude law, and referred the case to a hearing committee for full investigation to determine whether relevant facts supported a finding of moral turpitude.

The Court of Appeals found that “a formal contested hearing” by a hearing committee to determine whether the lawyer had committed moral turpitude “would be of little benefit.” It found that since the federal criminal proceeding had not determined that the lawyer-son knowingly signed false documents (a finding needed for moral turpitude), a separate inquiry by a hearing committee was not necessary.

On December 09, 2010, before the hearing committee conducted its full investigation, the D.C. Bar Counsel reached an agreement with Michael to a one year’s suspension of his law license.

OUTCOME (more): Rather than being disbarred, lawyer-son Michael was merely sanctioned for one year.

The Lawyer-Political Complex

The Military-Industrial Complex is but one subset of the Lawyer-Political Complex. If operations of the former are manifestly dangerous, what can be said of the latter?

The extent of influence available to and exercised by members of the legal profession surpass those of any other profession except organized crime in its heyday. While law grads comprise only 2-3% of the U.S. workforce, their collegial network extends to the highest levels of every important economic activity, including our defense establishment and government.

The system of checks and balances envisioned by framers of the U.S Constitution has been hobbled by infiltration of lawyers into career politics. When one profession exercises effective control over all three branches of government, as lawyers now do, the stakes for our republic are unnecessarily high.
The fedural judiciary is staffed, and headed by lawyers; 60% of U.S. Senators are lawyers; the House is comprised of 36% - 40%, and currently the president, vice-president, Majority and Minority Leaders of both the Senate and House are all lawyers.

Chairman of key congressional investigating and ethics committees (wielders of hidden, but threatening power) and at least half of their committee members are lawyers. The Hobbs Act defines extortion as: “the obtaining of property from another, with his consent, induced by wrongful use of actual or threatened force, violence, or fear, or under color of official right.” – 18 U.S.C. § 1951.

Property belonging taken under “official right” from a congressman by an ethics investigation might include unspent campaign funds and his seat, for starters.

Moreover, the wishes of citizens able to vote once every 2, 4 and 6 years often take a back seat to unelected lobbyists who provide travel and 'educational' influences to congress at least 240 days a year. The vast majority of lobbyists just happen to be law grads. They are members of the vast, unseen power network in which lawyers of all stripes must establish careers.

The average voter, blind to the facts described above, sees nothing upsetting about the power lawyers exert on each other and non-lawyer elected politicians who won’t go along with them.

No profession could long maintain a network this powerful and remain free of deep corruption. Ideally, no politician should be allowed to make a career of elected office, and lawyers should be elected to office in numbers closer to their actual representation in the general workforce. Of course, that is left to conscientious citizens who exercise their right to vote.

In the Public's Benefit - Installment 2010-2

From 2000 through 2006, attorney Steven M. Coren and several of his client-contractors defrauded government agencies by falsely representing that the contractors’ workers were being paid the prevailing wage as required by the federal Davis-Bacon Act and New York State Labor Law. On March 20, 2009, Coren pled guilty to a sixteen-count indictment charging him with scheming to defraud government agencies in connection with his clients’ construction contracts with those agencies, conspiring to launder the funds wrongfully obtained from those agencies, and obstructing the federal grand jury investigation by directing one of his clients to destroy documents related to the scheme.

Coren's scheme involved more than $10,000,000 in contract payments from various agencies for projects including 18 New York City public schools and 20 public housing projects. Over the course of the scheme, two contractors alone diverted over $750,000 in funds due employees.

Coren, who was sentenced to 30 months in prison in February, admitted he had advised a client to destroy a computer flash drive that could have been used in a federal investigation. Today it was been announced that the federal crimes of which Coren was convicted were sufficient to trigger his automatic disbarment from practice in New York State.

.......................... ....... ..........^ ^ ^

Why pick on law schools?

Law schools do not seem to compete for the public's benefit; school reputations currently connote to the public vague expectations of how brazen and arrogant their graduates may behave, rather than the innate integrity of their respective graduates.

Improving law school admissions standards, although certainly in the public interest, is highly unlikely. After all, law schools are not military academies and most lawyers were never Eagle Scouts nor recipients of Girl Scout equivalent Gold Awards.

Why pick on lawyers?

A disproportionate percentage of law graduates (hardly 2% of the entire workforce) are currently elected to over 20% of public offices (including 60% of the U.S, Senate and 100% of the U.S. Supreme Court). This presents conflicts of interest and publicly unintended concentrations of authority. Combined with self-serving laws tailored to give incumbents subtle advantages over challengers, the country is in growing peril of a permanent political class.

Meanwhile, proceeds of the underlying crimes are certainly adequate to provide corruptive influences in government at every level.