Last week, the Financial Crimes Enforcement Network (FinCEN) permanently barred former casino staffer George Que from working at financial institutions for willfully violating the reporting requirements of the Bank Secrecy Act (BSA).  Que, the former VIP Services Manager at the Tinian Dynasty Hotel & Casino in the Northern Mariana Islands, also agreed to pay a

A federal grand jury in San Francisco indicted FedEx Corporation, FedEx Express, and FedEx Corporate Services, Inc. (collectively, “FedEx”) for its role in distributing controlled substances and prescription drugs for illegal internet pharmacies.  The 18-count superseding indictment charges FedEx with conspiring with two internet pharmaceutical rings (internet pharmacies, fulfillment centers, doctors) to distribute controlled substances such as Ambien and Diazepam on invalid prescriptions, or based only on the customers’ completion of an online questionnaire, without examination by a physician.  The Government alleges that FedEx knew that it was delivering drugs to dealers and addicts, some of whom overdosed and died, and some of whom were underage. If convicted, FedEx could pay a fine of up to twice the gross gains derived from the offenses, alleged to be approximately $820 million.  The criminal proceedings will help answer when, if ever, the Government can deputize shipping companies to police illegal activity in internet commerce.
Continue Reading FedEx Charged with Criminal Distribution in Crackdown on Prescription Drug Abuse

A former agent for mining company BSG Resources Ltd., Frederic Cilins, was sentenced Friday to 24 months in prison for obstructing a federal investigation into an alleged bribery and money laundering scheme.  The charges against Cilins stem from an FBI investigation into efforts to secure lucrative mining concessions in the Republic of Guinea.  According to

With the Second Circuit’s recent reaffirmation of the SEC’s substantial discretion in negotiating the terms of settlement—notably vacating Judge Jed Rakoff’s rejection of the proposed $285 million settlement in SEC v. Citigroup Global Markets, Inc.—eyes are turning to the decision’s immediate impact on at least one other high-stakes case:  a $602 million insider trading settlement between the SEC and CR Intrinsic Investors, an affiliate of S.A.C. Capital Advisors.  Similar to the SEC-Citigroup settlement, CR Intrinsic was not required to admit wrongdoing in settling the SEC’s charges.  Judge Victor Marrero had conditionally approved the settlement pending the outcome of the Citigroup appeal.  
Continue Reading Revisiting SEC Consent Decrees in the Wake of SEC v. Citigroup

On June 4, 2014, the Second Circuit Court of Appeals vacated Judge Rakoff’s November 28, 2011 Order that had rejected the Citigroup-SEC settlement on a number of grounds, including that the SEC had allowed Citigroup to avoid admitting guilt. The Appellate Court found that Judge Rakoff abused his discretion and committed “legal error” in requiring

Over 90% of federal criminal cases are resolved by plea agreement, and plea agreements typically require defendants to waive their rights to appeal their sentences.  In many cases, prosecutors also require that defendants agree to pay restitution (compensation for loss) to the victims of the crime.  Practically speaking, the specific amount of restitution to be paid is rarely set forth in the plea agreement.  Rather, restitution is calculated by the court during sentencing. But what if the court errs by miscalculating the amount of restitution?  Does the plea agreement’s waiver of appeal rights apply to the calculation of restitution? According to the Sixth Circuit–it depends.
Continue Reading Sixth Circuit: When Plea Agreements Waive the Right to Appeal Restitution