Originally published by Malcolm Mercer .
Article by Nick Robinson, Fellow, Harvard Law School, Program on the Legal Profession Abstract With multiple countries now allowing for non-lawyer ownership of legal services, and other jurisdictions considering a similar shift, the legal profession is in the midst of…
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Originally published by State Bar of Texas .
Judge John Ellisor of Galveston (122nd District Court) was trying a criminal case when this exchange occurred between the defendant’s attorney and the police officer on the stand:
Q. How old was Northrup at the time?
A. I believe it was 19 – I’m sorry 17.
Q. And that’s – for the purpose of criminal procedure, that is being an adult?
A. Correct.
Q. How much into adulthood is that for the purpose of criminal procedure?
A. All the way.
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Originally published by Carrington Coleman .
Preston State Bank v. Willis
Dallas Court of Appeals, No. 05-12-00688-CV (August 26, 2014)
Justices Bridges (Opinion), FitzGerald, and Lang-Miers
Preston State Bank was served with a grand jury subpoena for an account holder’s financial records. The Bank conceded it had a duty to comply, and did so, but argued that requiring it to comply without reimbursement of its costs of making the production—over $16,000 in this case—constituted a taking of property for public use without just compensation. Accordingly, the Bank contended, the subpoena and the statute governing production of financial records, Texas Finance Code § 59.006, are unconstitutional as applied. In an opinion that disposed of a number of other issues along the way, the Dallas Court of Appeals rejected the Bank’s plea. Following the lead of the United States Supreme Court on a related issue, the Court held that the Bank’s complying with a grand jury subpoena did not constitute a “taking” under the state or federal constitution, notwithstanding the undeniable burden it imposed. Instead, it is the performance of “a public obligation to provide evidence,” and, as the Supreme Court stated in Hurtado v. United States, “the Fifth Amendment does not require that the Government pay for the performance of a public duty it is already owed.”
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Originally published by Christian Dennie .
The NCAA Committee on Infractions (“Committee”) recently issued its findings and found that the Saint Francis University (“SFU”) committed violations of NCAA legislation. After the investigation concluded the case was submitted to the Committee through the summary disposition process, which is an alternative to a formal hearing before the Committee that may be utilized when the NCAA enforcement staff, the member institution, and involved individuals agree to the facts of an infractions case and that those facts constitute violations of NCAA legislation.
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Originally published by Kyle Barnett .
NEW ORLEANS – Oil giant BP PLC has filed a motion to have Patrick Juneau removed as claims administrator in the Deepwater Horizon oil spill litigation, arguing that he is biased and has not been forthcoming about potential conflicts of interest.
The sharply worded 35-page motion filed by BP on Tuesday afternoon caps months of rancor between Juneau, who was appointed in 2012 to oversee the oil spill settlement, and the oil company, which has paid out tens of billions of dollars in damages.
The motion accuses Juneau of several breaches of duty including representing related parties in the suit prior to being named claims administrator, expediting the claims of friendly lawyers and overseeing a claims facility that has seen five senior-level departures in the past year that have been linked to misconduct or corruption. BP claims the bias exhibited by Juneau is longstanding and cannot be extricated from the ongoing claims program.
“With billions of dollars at stake, the Court, the parties, and the public rightly expected that the Claims Administrator would be a neutral, not a partisan,” the motion reads. “Fairness, and the appearance of fairness, required that he be a neutral. Because he is Court-appointed and functions as an arm of the Court, he must be a neutral, free of a disqualifying conflict of interest. Mr. Juneau, however, was not a neutral when the Court appointed him.”
Much of BP’s motion focuses on a 2010 contract that Juneau personally signed with the State of Louisiana to represent the state’s interests in regard to the 2010 oil spill.
According to state records, Lafayette-based Juneau David law firm was first contracted by the state on July 2, 2010 for $175,000 to “provide advice and counsel” when the settlement facility was operated under Juneau’s predecessor, Kenneth Feinberg. The contract later grew to $275,000, state records show, and ended abruptly on July 21, 2011 – only four days before plaintiff’s lawyers in the BP case filed a motion to have the court appoint a special master.
Juneau was ultimately later hired to fill the special master position.
When asked about the contract in a recent interview, Juneau said the work he performed under the state contract was not as an adversary to BP.
“I wasn’t representing the state to prosecute, but to give them advice and input into the procedures and the protocols that were being utilized and developed through the Feinberg process,’’ Juneau said. “And I did that for a period of time. I was advising them on what that was and that is all information that everybody in this case – I disclosed all of that to the parties in advance. I wasn’t prosecuting anything, it was strictly in an advisory capacity.”
BP disagrees with Juneau’s assessment of his work with the state. In its motion, BP said Juneau’s state work involved trying to get Feinberg to relax standards of proof needed to file oil spill damage claims.
“Meanwhile, [Juneau’s] former client Louisiana continues to be adverse to BP in this multidistrict litigation and seeks billions of dollars based on claims that, it now seems, are consistent with, and possibly based on, legal work performed by the Claims Administrator as counsel for the State,” BP’s motion says.
The BP motion also notes a sworn deposition that Juneau gave to fraud investigator Louis Freeh on Aug. 1, 2013. In the deposition, which was filed into the court record in January, Juneau told Freeh that he had no connection to the Deepwater case prior to his appointment as claims administrator in late 2012.
“Now, I knew, from reading the newspaper — I didn’t have any involvement in anything in the spill. I didn’t represent any claimants in the spill, wasn’t representing any defendants in the spill, had really had no connection with the spill per se,” Juneau said in the deposition.
Juneau later said he did not feel a need to disclose his state contract when he gave his sworn statement to Freeh, because all parties, including Freeh, already knew about it.
“The Freeh Group has done an extensive [evaluation],’’ Juneau said. “They went through this whole thing with me, they know everything I’ve done.”
In addition, Juneau said he did not feel he was deceiving anyone and added that both BP and the Plaintiffs’ Steering Committee knew about the contract when they agreed that he should be the new claims administrator.
“I can tell you the parties knew about it. I disclosed that to the parties and the court in advance. There was no question about it, that wasn’t even an issue. I disclosed it anyway,” he said.
In its motion, BP said it had been given only the barest of information about Juneau’s contract with the state, in the form of a note, from one of its lawyers.
“Consulted with La. (State) about whole Feinberg process,” the note reads.
BP said in its motion that the note grossly understates Juneau’s prior role in the case. Juneau’s sworn statement remains at odds with the facts, according to BP’s motion.
“Certainly any individual reading from the publicly available portion of the Claims Administrator’s sworn statement would conclude that he knew about the oil spill only from information that he had learned by reading the newspaper – and not that he personally had signed a contract for his law firm to receive hundreds of thousands of dollars for representing a party adverse to BP on oil-spill matters, which had terminated only six months before,” the BP motion reads.
Geoff Morrell, BP senior vice president, U.S. communications and external affairs, said said Juneau obviously did not provide enough information regarding the contract between his law firm and the state.
“He purported to make disclosures over time that were ambiguous and incomplete, and are epitomized by his statement in August 2013 to Judge Freeh that he ‘didn’t have any involvement in anything in the spill [and] didn’t represent any claimants in the spill,’” he said.
Melissa Landry, executive director of Louisiana Lawsuit Abuse Watch, said BP’s latest motion is indicative of deep problems with Juneau’s oversight of the Deepwater Horizon claims process.
“The questions raised in this motion about the overall integrity of the claims process that is currently underway are deeply disturbing,” she said. “For some time, we have known about the systemic payment of questionable claims and the many senior officials operating under Mr. Juneau that were forced to resign amid serious allegations of money laundering and other unethical behavior.
“The most troubling of all, however, is the information about Mr. Juenau’s apparent conflict of interest. The court should act quickly to ensure that the rule of law is being followed and that the system is fair for all the remaining claimants who were truly harmed by this tragic industrial accident.”
The post BP files motion to remove Patrick Juneau as claims administrator appeared first on Southeast Texas Record.
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Originally published by Stock Broker Fraud Blog .
Blake B. Richards, an ex-LPL Financial (LPLA) broker, must pay close to $2 million in penalties and disgorgement over allegations that he defrauded clients of close to $1.7 million. According to the case, submitted in the U.S. District Court of the Northern District of Georgia, Richards told at least seven clients to write checks to entities under his control. The clients thought that the money would be invested in variable annuities, fixed-income investments, or equities. Instead, contends the U.S. Securities and Exchange Commission, the funds were used to pay for his personal spending.
According to the SEC, most of the investors’ money came from life insurance proceeds or retirement savings. Two of the investors involved were widowed and at least two others were elderly customers.
Per the regulator’s complaint, Richards won one investor’s trust by delivering pain meds to her husband during a snowstorm. The spouse was suffering from terminal pancreatic cancer at the time.
Richards has not denied or admitted to the charges. The agency said that his actions indicate “selling away,” which involves brokers defrauding investors through external business activities.
LPL let Richards go last year after another adviser notified the brokerage firm about his alleged wrongful conduct involving non-firm accounts. The broker-dealer then conducted its own probe and notified regulators. Also last year, the Financial Industry Regulatory Authority barred Richards.
Senior Fraud
Elderly investors are a favorite target for fraudsters. According to a survey by the Investor Protection Trust, the American Bar Association, and the Investor Protection Institute, 34% of attorneys who took the poll said they either work with or expect to represent senior clients who have been victims of fraud. 27% reported dealing with the children of older fraud victims who either are trying to help their parents, who’ve been bilked, or the kids are the ones accused of exploiting them.
In an earlier survey, the Investor Protection Trust found that over 7.3 million Americans older than 65 had already sustained fraud losses. Earlier this month, the North American Securities Administrators Association set up the Committee on Senior Issues and Diminished Capacity. The panel, which is comprised of state securities regulators, will look more closely at elder financial abuse and the problems that can occur related to retirement nest eggs and complex financial securities. NASAA-compiled enforcement statistics indicate that 34% of actions in the last six years involved senior victims.
One reason for this is that the retirement population is growing, especially as people are living longer. However, a diminished mental capacity and the growing number of complex financial products can make for a bad combination. Many retirees may not be able to understand what they’re putting the retirement money into, and they can end up suffering huge losses.
The SEC has also expressed concern about how elderly investors continue to be targeted by fraudsters.
Contact our elder financial fraud lawyers today to request your free case consultation. Shepherd Smith Edwards and Kantas, LTD LLP also represents investors based abroad with securities claims against U.S. firms.
Ex-LPL broker ordered to pay $1.9 mln in U.S. SEC fraud suit, August 28, 2014
Senior investor concerns, abuse get more regulator attention, Investment News, April 19, 2014
More Blog Posts:
LPL Financial to Pay Illinois $2 Million Fine Related to Variable Annuity Exchanges, Stockbroker Fraud Blog, August 13, 2014
SEC Charges Ex-UBS Broker in $730K Elder Financial Fraud Ponzi Scam, Stockbroker Fraud Blog, August 4, 2014
LPL Financial Ordered to Pay $7.5M FINRA Fine Over E-Mail Failures, Institutional Investor Securities Blog, May 22, 2013
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Originally published by tfoxlaw .
I think I may have finally seen the light that Jay has been preaching to me over the past few years when I read an article in the September issue of the Harvard Business Review (HBR), entitled “What’s Your Language Strategy?” by Tsedal Neely and Robert Steven Kaplan. The authors posit that language should bind not only your company’s global talent pool but also your company’s vision. After concluding the article, I now understand how language is a strategy to help inform your compliance program as well. This is because just as “Language pervades every aspect of organizational life” the authors believe that companies “often pay too little attention to it in their approach to talent management.” I would add that is also true in the compliance function.
The authors believe that problems revolve around potential “blind spots regarding language.” They write that company leaders pay too little attention to the role of language when “hiring, training, assessing and promoting employees. This can lead to miscommunication and friction, especially among team members who collaborate across borders.” While the authors point that a company’s competitiveness that may suffer, I would suggest that a company’s compliance function could also suffer. The authors believe that a company should align its language strategy with its overarching priorities. Further, by building “language skills and cultural awareness throughout your organization in order to acquire and develop the kind of talent you need to compete globally and locally.” The authors believe that by paying attention to this issue, your company can potentially turn “vulnerability into a competitive strength.”
The authors identify five key points which a company should evaluate regarding language. I would also add they relate directly to any international company’s anti-corruption compliance function whether under the FCPA; UK Bribery Act or other anti-bribery regime.
Hiring and Training
Here companies need to understand how candidates might come across in the interview or other pre-employment evaluation process. While a candidate with multiple language fluency may overshadow deficits in other critical areas, it may also be a problem because as an evaluator, “you may need to accept some limitations on language capabilities and be prepared to provide training to meet both global and local language needs.” But even if you get pass this first hurdle the authors identify a follow up problem in this area; that is, after hiring and/or promotion. They state, “Another blind spot is a tendency to over rely on external lateral hires with a certain degree of language skill to fill midlevel roles rather than hiring and grooming outstanding junior candidates with the capacity and motivation to learn new languages. While the latter approach may initially take more time, companies often find that entry-level hires ultimately become their best leaders, because they have been trained from an early stage in company culture and practices. Defaulting to lateral hires can make it more difficult to build a cohesive culture—those recruits have been trained elsewhere and may have trouble assimilating.”
Evaluating Talent Accurately
Even if your company does improve its entry level hiring practices and provide training to assist new employees in their language skills, you still need to make accurate performance evaluations. Here companies may get into trouble because “Language agility does not necessarily spell high performance.” The authors point to the need for a robust process to assess skills and attributes which allows a company to “look beyond verbal agility when gauging performance. It’s a reality check, a way to make sure that you and other leaders are not unduly swayed by fluency.”
Rethinking the Role of Expatriates
One of the key areas in the compliance field is to develop local compliance talent and expertise. This is not only because “expatriates may not be familiar with the local language, culture, and business practices, they can bring knowledge of organizational culture along with an understanding of the company’s products, processes, and systems.” One of the roles of any compliance manager, particularly an ex-pat is “to focus on developing local talent and ensuring that indigenous professionals begin to play leadership roles in the local businesses.” Equally important is to “think about the people you’re choosing to send abroad. To build a strong team of local leaders, it’s critical to give expatriate assignments to your best people—not just to solid contributors who happen to have the right language skills and are more easily dispensed with at home. Otherwise, you may find that your firm’s global offices fail to attract, develop, and retain the strong indigenous talent they need for high performance.”
Managing Communications on a Global Team
Most of the company’s I have worked at hold all their communications in English-language on a company wide basis. Of course I thought this was great. But the authors note that “managers often unwittingly position native speakers of a lingua franca as “winners” within the firm; consequently, nonnative speakers experience a substantial loss of power and status. If companies don’t take such issues into account, they can cause otherwise talented and engaged professionals to underperform and even withdraw.”
The authors believe that managers need to understand which of their employees are comfortable with the second-language proficiency and those who may not be so comfortable. They provide specific guidance as follows, “Global managers must deal directly with such issues to promote productive global cooperation. They must be sensitive to how employees of varying language proficiency are interacting. The goal is to make it easier for native and nonnative speakers to establish trust and communicate effectively. Managers’ observations should include the following: Who attends meetings? Who speaks up? Are the best employees contributing, or is language getting in the way? It’s then important to facilitate meetings and calls so that nonnative and native speakers get equal airtime. Often this means coaching primary-language people to speak less and second-language people to speak more. It also involves setting clear agendas up front, considering the mode of communication, and thinking through meeting choreography in advance.”
Building Cultural Awareness
The authors conclude by reminding us that language fluency does not always equate to cultural fluency, as “too often leaders underperform because they fail to adapt their management styles and practices to fit a multicultural environment. For them, understanding the cultural background of each team member, the role of the company, its products and services, and the customers it serves within various cultural and regional contexts is as essential as learning to conjugate new verbs.” They believe that “Managers should be held accountable that language and cultural skills are developed throughout their organization.”
The authors’ piece is chock full of ideas, insights and issues for a Chief Compliance Officer (CCO) or compliance practitioner. Any company doing business internationally is going to have the issues that the authors discuss in their article. The compliance function has all of these issues in spades because if you need to consider the FCPA, it is because you are doing business internationally.
This publication contains general information only and is based on the experiences and research of the author. The author is not, by means of this publication, rendering business, legal advice, or other professional advice or services. This publication is not a substitute for such legal advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified legal advisor. The author, his affiliates, and related entities shall not be responsible for any loss sustained by any person or entity that relies on this publication. The Author gives his permission to link, post, distribute, or reference this article for any lawful purpose, provided attribution is made to the author. The author can be reached at tfox@tfoxlaw.com.
© Thomas R. Fox, 2014
Filed under: Best Practices, Compliance, Compliance and Ethics, compliance programs, Department of Justice, FCPA, FCPA Guidance, Jay Rosen, Language Tagged: best practices, compliance, compliance programs, ethics and compliance, FCPA, Merrill Brink 
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