ABA White Collar Conference: Relearning Old Lessons

Two of yesterday’s panels at the ABA Annual White Collar Crime Conference were excellent. The panel on the year’s major cases, all of which resulted in convictions, reminded the audience of some time-tested truths. Most or all of the convicted defendants had talked to somebody–the grand jury, corporate internal investigators, or the SEC–prior to indictment. There was general agreement among the attorneys on the panel that the talking had been a major mistake. The decisions to talk had been made for the most part by previous counsel on the cases at issue. 

Ted Wells, who represented Scooter Libby, was, true to form, an outstanding panelist.  Wells stressed that Libby faced a choice, when deciding whether to testify before the grand jury, between increasing his criminal exposure and losing his job. This is a choice sometimes faced by politicians and public servants who are witnesses, subjects, and targets. It is a choice also faced by corporate executives who are asked to participate in internal investigations or testify at the SEC. The ultimate question that all of these people should ask themselves, at every stage of the game, is: “What do I prefer–to lose my job or my liberty?”

Wells reminded the audience that even the sharpest clients and attorneys often cannot comprehend the full scope of a criminal investigation. Thus there is no way to be prepared for every question. Libby, before he hired Wells, testified in front of the grand jury, apparently not realizing that Patrick Fitzgerald’s mandate was much broader than the question of who leaked Valerie Plame’s name to Robert D. Novak.

The ethics panel focused on ethical quandaries associated with corporate internal investigations. As usual, Earl Silbert called, correctly, for transparency by audit counsel in dealing with corporate employees who are potential interviewees. Specifically, if audit counsel anticipates that the corporation’s attorney-client privilege will be waived, and that interview results will be turned over to the government, these facts should be made clear to the interview subjects. Professor Ellen Podgor, of the White Collar Crime Prof Blog, and the other panelists also made excellent contributions. Ellen is also posting on the conference.

The securities enforcement session was largely forgettable. Again, no mention whatsoever of the dismissal of all criminal charges in the David Stockman case.