Posts Tagged ‘Eliot Spitzer’

Can regulators insist that a company fire its CEO?

In New York that’s getting to be a regular pattern in the settlement of charges against financial firms; although Eliot Spitzer, known for creative methods of corporate decapitation, may have departed office, Spitzerism lives on. I explain in a new Cato post on the state’s Ocwen Financial pact.

Related: Tactics the federal government used to seize control of insurer American International Group (AIG) away from Hank Greenberg, now made public despite years spent resisting disclosure [Gretchen Morgenson, New York Times]

Colorado recalls; NYC voters spurn Eliot Spitzer

Next time someone says big money calls all the shots in American politics, remember that an 8-1 money advantage fueled by Michael Bloomberg and other national donors wasn’t enough to save the seats of two lawmakers who’d helped push a gun-control package through the Colorado Senate, thus infuriating constituents in a marginal Colorado Springs district and in the blue-collar Democratic stronghold of Pueblo. [Denver Post, David Kopel, Volokh Conspiracy, The Denver Channel]

Meanwhile, New York City Democratic primary voters decided against nominating whited sepulcher Eliot Spitzer as the city’s next comptroller, thus foiling Spitzer’s plan to get his hands on billions of pension fund dollars with which to engage in grandstanding and litigation [WABC, Lawrence Cunningham]

P.S. Less happily, voters in Richmond, Calif. are going to let the city administration proceed with a scheme to seize underwater mortgages by use of eminent domain [Daniel Fisher, more, earlier]

Police and prosecution roundup

  • Body cameras protect both police and the citizenry [Steve Chapman]
  • “Federal Prosecutor Disciplined for Making False Statements” [John Steele, Legal Ethics Forum]
  • “The more popular view is that the role of a jury is to deliver a guilty verdict when the government accuses someone of a crime” [Ken at Popehat]
  • More on forfeiture following New Yorker piece [Steve Greenhut, ABA Journal, earlier]
  • How feds went after maker of secret automotive compartments [Brendan Koerner, Wired, April; Amy Alkon] Held at gunpoint for half hour+: massive Texas SWAT raid on organic farm yields okra, no pot [Radley Balko] Mother Jones magazine is perfectly happy to cheer on Drug War lunacy when that affords a chance to bash big pharma [Cathy Reisenwitz, Thoughts on Liberty]
  • “Law Enforcement Wants To Weaken Section 230: What Could Possibly Go Wrong?” [websites’ immunity for content left by visitors; Popehat]
  • Eliot Spitzer’s prosecutorial sins catalogued [Lawrence Cunningham]

What Spitzer might be up to as NYC comptroller

Strong-arming gun makers to act against their perceived business interests, as well as those of their customers:

…in retrospect, there were a few clues that Spitzer was eying a job whose duties include managing the city’s pension funds…

In December, after the school massacre in Newtown, Conn., Spitzer wrote a column in the online publication Slate arguing that pension funds should use their investing clout to pressure corporations such as gunmakers to act in the public interest.

New York City’s comptroller, Spitzer said in the interview, is “a significant player in terms of the pension funds and how those shares are voted. And when I speak with folks about corporate governance, the missing link in all of this has been ownership.”

Eliot Spitzer has long been a key player in efforts to intimidate lawful gun manufacturers through both strained litigation theories and hamhanded attempts at economic pressure. The NYC comptroller’s office, with its sway over billions in pension fund money, would present him with a large sandbox indeed.

June 4 roundup

“Structuring”: who can get away with it, and who can’t

“Structuring,” as readers may recall, is the federal criminal offense of splitting up bank deposits so as to keep them under a threshold such as $10,000 above which banks have to report transactions to the government. Structuring is unlawful whether or not it occurs in conjunction with any other legal offense, as opposed to being motivated by, say, a desire to keep a low profile in general or a sentiment that the government already keeps tabs on too many innocent activities. Nor is there any requirement that the person be aware that there is a law banning structuring; someone who gets wind that transactions over $10,000 are reportable, and decides “What’s up with that? I’ll just make $9,000 deposits”), has broken the Bank Secrecy Act. Indeed, the federal government instructs banks to report suspicious patterns of sub-threshold deposits, and not to warn customers that it is doing so.

So who can engage in structuring and get by with it? Well, it might have a bit to do with who you are:

* On the one hand, as Courtney Mabeus reports in today’s edition of the Frederick News-Post, federal prosecutors yesterday filed a six-page complaint against dairy farmers Randy and Karen Sowers, who own the successful South Mountain Creamery in Middletown, Md. On February 29 Treasury officials showed up at their farm to question them about bank deposits; 45 minutes into that interview, according to the Sowerses, they learned that the federal government had just seized their bank account and the $70,000 in it. The family does a lot of business at farmer’s markets and its cash receipts over a ten-month period exceeded $320,000, the feds say. The News-Post account includes no mention of the family being under suspicion of any offenses other than what U.S. Attorney Rod Rosenstein describes as follows: “The holding back of cash receipts in excess of $10,000 indicates a knowledge of the Currency Transaction Reporting requirement and an attempt to evade it.” The couple is now speaking out about their plight to a wider public; they have hired attorney David Watt, though how they intend to pay him given the seizure of their bank account is not clear from the article. (Update Apr. 21: see also Apr. 18 coverage in Baltimore City Paper; & welcome Radley Balko readers)

* On the other hand, if you are former New York Attorney General Eliot Spitzer, you might not find the federal structuring laws so intimidating. Spitzer had good reason to be intimately familiar with the bank reports system since he had relied on its output in conducting white-collar investigations, and he was “smurfing” deposits in furtherance of conduct that was itself illegal, as he knew well, having crusaded in favor of longer sentences for “johns” as part of his appeal to New York City feminist and legal-services groups. But as Harvey Silverglate points out, “Spitzer, with the help of a high-powered legal team, was able to convince the Justice Department’s lawyers to drop the charges.” Now he goes on TV to denounce the federal government’s failure to prosecute persons in high places.

Maybe they’re too busy going after the dairy farmers.

P.S. The Supreme Court, in a majority opinion by Justice Ruth Ginsburg [Ratslaf v. U.S., 1994], admirably “interpreted the ‘willfully’ element for a currency structuring violation under 31 U.S.C. Sec. 5324 to require proof that the defendant knew the structuring was illegal. Congress responded rather promptly to the Court’s holding by dropping willfulness from the statute.” [White Collar Crime Prof, h/t Sam Bagenstos] (& welcome Prof. Bainbridge, Amy Alkon, Hans Bader readers; & see update.)

Free speech roundup

  • Berkeley: “Police chief sends sergeant to reporter’s home after midnight to demand article revision” [Poynter] In 1932, a New York Congressman convened a hearing to blast theater critics for harming the welfare of Broadway shows [Philip Scranton, Bloomberg]
  • “Blasphemy and free speech” [Paul Marshall, Hillsdale “Imprimis,” PDF] “Egyptian Christian Imprisoned for 6 Years for Insulting Mohammed” [Volokh]
  • What is it about Montana and election free speech these days? [Volokh] Judge denies Ron Paul campaign request to unmask source of anti-Huntsman video [Paul Alan Levy, earlier] “Eliot Spitzer Bucks Liberal Orthodoxy: ‘Citizens United Was Correct'” [TheDC] If you rely on the NY Times for what you know about Citizens United, you’re probably misinformed [Wendy Kaminer, Atlantic]
  • “In which Ben Bagdikian, alleged scourge of media monopolies, frets at the possibility of more TV channels” [BBC via Jesse Walker]
  • Guernsey as a haven for libel tourism? [Annie Machon] “Someday I will commission a study of the relationship between defamation lawsuit threats and illiteracy.” [@Popehat on Gawker item]
  • “Key Techdirt SOPA/PIPA Post Censored By Bogus DMCA Takedown Notice” [Mike Masnick]
  • Overly aggressive trademark lawyers? “Their mothers love them too, in a prone-to-sudden-weeping sort of way.” [Popehat; earlier on Louis Vuitton v. Penn Law case]