18 Corporate Crime Reporter 33(1), August 13, 2004

Top Ten Corporate and White Collar Crime Prosecutors List Released

Corporate Crime Reporter released its list of the top ten corporate and white collar crime prosecutors.

The list was based on a survey of major corporate crime prosecutions over the past year.

“The vast majority of state and federal prosecutors don’t have the resources, staff, energy, perspective, know-how, legal authority, and – perhaps most importantly – political drive needed to bring major corporate crime prosecutions,” said Russell Mokhiber, editor of the Corporate Crime Reporter. “The overwhelming number of prosecutors in the country look at the obstacles and say – I’ll pass. But these ten prosecutors have what it takes to tackle the problem.”

“The prosecutors who enter this field need an added element – a finely tuned sense of political and prosecutorial discretion – knowing when to go and when to stop, so as not to offend the powers that be,” Mokhiber said. “If things go right, prosecutors use the publicity they gain from these prosecutions to fuel their ongoing quest for higher office. If things go wrong, as they can easily and often do, these prosecutors will be publically humiliated in the courtroom by high-priced white collar crime defense attorneys and in the court of public opinion by the business press and political rivals.”

The top prosecutors (in alphabetical order) are:

Christopher Christie, U.S. Attorney, New Jersey
James Comey, Deputy Attorney General, Justice Department, Washington, D.C.
Patrick Fitzgerald, U.S. Attorney, Chicago
David Kelley, U.S. Attorney, Manhattan
Alice Martin, U.S. Attorney, Birmingham, Alabama

Patrick Meehan, U.S. Attorney, Philadelphia, Pennsylvania
Robert Morgenthau, District Attorney, Manhattan
Eliot Spitzer, Attorney General, New York
Michael Sullivan, U.S. Attorney, Boston, Massachusetts
Debra Yang, U.S. Attorney, Los Angeles, California.


The prosecutors were chosen for their consistent emphasis on high profile corporate and white collar crime cases.

Christopher Christie, U.S. Attorney, Newark, New Jersey

Until he resigned from office last week for personal reasons, the Governor of the state of New Jersey was under investigation for public corruption.

He might still be.

To get to the Governor, federal prosecutors had go through his big financial contributors. So, they focused on one big financial contributor.

This financial contributor didn’t want a witness cooperating with the federal investigation, so he lured the witness into a trap, set him up with a prostitute, and videotaped the scene.

Yes, it is New Jersey. Yes, it is public corruption. Yes, it is sordid.

The U.S. Attorney pursuing the case is Christopher Christie, a Republican conservative – tried and true.

The Governor, James E. McGreevey, is a liberal Democrat.

The financial contributor, now under indictment, is Charles Kushner.

You have to hand it to Christie. Of course, there are the charges of political motivation.

Christie, they say, wants to be Governor.

But Christie is an equal opportunity prosecutor of public corruption.

Last year, he nailed former Essex County Executive James W. Treffinger, a Republican. Trefflinger pled guilty to obstruction of justice.

To derail the investigation of his granite company, Treffinger sought to get himself appointed US attorney. He was recorded as saying that there are ''plenty of mobsters to go after – you
don't have to go after all these poor politicians trying to ply their trade."

Christie believes that the political criminal is in many ways ''worse than the street criminal because the street criminal never pretends to be anything but what he or she is.”

But while public corruption has been the name of the game in New Jersey almost forever, Christie has also pursued major corporations for pollution, fraud, and false claims against the government.

In short, Christie has reinvigorated a formerly sleepy office.

Christie graduated from Seton Hall University Law School in 1987.

He then signed on with the Cranford, New Jersey law firm of Dughi, Hewit & Palatucci, where he became partner.

President Bush appointed Christie to be U.S. Attorney for New Jersey in December 2001.

Maybe he’s cracking down on corporate crime and corruption because he wants to be Governor of New Jersey.

Maybe he’s doing it because it’s his job.

Whatever the motivation, public corruption in New Jersey ain’t going away anytime soon. And better to have a Christopher Christie than someone who’s asleep at the switch.

James Comey, Deputy Attorney General, U.S. Justice Department, Washington, D.C.

When reporters in Washington get an e-mail informing them that in two hours James Comey will be holding a press conference at the Justice Department, there are two likely explanations.

Comey will either be announcing a major breakthrough on terrorism.

Or Comey will be announcing a major breakthrough on corporate crime.

As the Chairman of President Bush Corporate Fraud Task Force, Comey has played a prominent role in the administration’s highly politicized effort to crack down on corporate crime.

Last month, on the second year anniversary of the creation of the Task Force, Comey, Attorney General Ashcroft and President Bush declared victory.

And an unlikely victory it was. Here was a Republican administration, wedded at the hip to big business, marinated in corporate funds, with ties to some of the most notorious accused white collar crooks – and


Comey’s job is to take corporate crime off the table as a political topic in a Presidential election year.

With the help of a group of spineless Democrats, Comey delivered. (John Kerry’s web site, for example, still has no position paper on corporate crime.)

And it wasn’t just the rhetoric – although hearing President Bush talk about cracking down on corporate crooks is a wonder to behold.

By some indicators, the Bush’s crackdown has turned the corner on corporate fraud.

According to Columbia University law professor John Coffee, the number of financial restatements -- corrections of previously released earnings statements -- soared from 40 or 50 annually in the early 1990s, to a peak of 360 two years ago.

Last year, the number declined to about 300, Coffee said.

Some of this decline is due to the work of federal prosecutors under Comey’s direction.

Since the inception of the Task Force through May 31, 2004, prosecutors obtained over 500 corporate fraud convictions or guilty pleas and charged over 900 defendants and over 60 corporate CEOs and presidents with some type of corporate fraud crime in connection with over 400 filed cases.

Say what you will about Attorney General John Ashcroft. But when he chose the U.S. Attorney from Manhattan to lead the administration’s fight against corporate crime, he made the right call.

While U.S. Attorney, Comey went out on a limb and prosecuted Martha Stewart and Frank Quattrone, highly controversial prosecutions when brought.

In an administration so closely allied with big business and often ethically challenged, Comey projects an image of morality, stature, and distance.

In December, he tapped his good friend Patrick Fiztgerald, the U.S. Attorney in Chicago, to investigate the Valerie Plame/CIA leak case – a move that quieted the a howling pack of Washington journalists who were accusing the administration of a cover-up.

Patrick Fitzgerald, U.S. Attorney, Chicago

Late year, Deputy Attorney General James Comey appointed Chicago-based U.S. Attorney Patrick Fitzgerald to investigate who leaked the name of undercover CIA operative Valerie Plame to reporter Bob Novak.

Attorney General John Ashcroft then recused himself from the case.

Why Fitzgerald?

Well, first of all, Comey needed someone he could trust, so he turned to one of his best friends in the U.S. Attorney corps.

"They have taken one of the most experienced and independent U.S. Attorneys in the country," said Lawrence Barcella, a partner at Paul Hastings in Washington, D.C."And they made Pat Fitzgerald the special counsel for this case. Pat Fitzgerald and Jim Comey are old long-time dear friends. They served in the U.S. Attorneys office in the southern district of New York. They tried some terrorism cases together. And that could cut both ways. It probably does mean that Jim Comey has complete utter confidence and trust in Fitzgerald. And when he says -- you handle it, and you just come to me when you need resources – I'm sure that is exactly what he does mean."

Fitzgerald is also in the middle of a high profile corruption prosecution of former Illinois Governor George Ryan. He’s also juggling a myriad of other public corruption, corporate crime and white collar fraud cases. But he has about 150 assistant U.S. Attorneys to rely on.

Even Ryan's defense attorney, Dan Webb, thinks picking Fitzgerald for the CIA leaks investigation was the right move.

"This is perfect for him," Webb told Corporate Crime Reporter earlier this year. "He's an outstanding prosecutor. He will clearly get to the bottom of the issues in this case. People will have confidence in the results."

Fitzgerald is a graduate of Amherst College (1982) and Harvard Law School (1985).

He spent 13 years at the U.S. Attorney’s office in Manhattan before moving to Chicago.

David Kelley, U.S. Attorney, Manhattan, New York

If you are the U.S. Attorney in Manhattan, you have little choice but to prosecute corporate crime.
Manhattan is the corporate crime center of the universe.

If you are the U.S. Attorney in Manhattan, you have to have a severe case of attention deficit disorder to not make this list.

And given the hyperactivity that afflicts the prosecutors around him in New York, you would think that David Kelley might not rank.

But the cases just keep coming, and Kelley has to keep up.

And he has, convicting Martha Stewart, former Credit Suisse First Boston Frank Quattrone – on the second try – and Adelphia cable company founder John Rigas and his brother Timothy Rigas. The fraud case against Michael Rigas, the son of the founder, ended in a mistrial, and Kelley plans to retry the case. A fourth Adelphia defendant, Michael Mulcahey, the cable company's former assistant treasurer, was acquitted of all charge.

Kelley secured a plea agreement from Scott Sullivan, the former CFO of WoldCom in an effort to nail WorldCom’s former CEO, Bernie Ebbers, who has been indicted.

Kelley has brought major fraud charges against former executives of U.S. Foodservice, a subsidiary of the Dutch food giant Ahold.

In December 2003, Attorney General John Aschcroft appointed Kelley, a Democrat and former cop, to succeed James Comey as U.S. Attorney in Manhattan. Ashcroft named Comey to be his Deputy Attorney General.

Kelley joined the U.S. Attorney’s office in 1988. He specialized on organized crimes and terrorism. Kelly prosecuted Ramzi Yousef for his role in the 1993 bombing of the World Trade Center. He also prosecuted the John Walker Lindh case and is in charge of the federal probe into the October 2000 attack on the USS Cole in Yemen.

He’s currently prosecuting a controversial case against defense attorney Lynne Stewart for providing material aid to a terrorist group.

Kelley is a graduate of New York Law School and the College of William and Mary. After law school, he served as a police officer in East Hampton, New York.

Alice Martin, U.S. Attorney, Birmingham, Alabama

In the testosterone driven world of the corporate crime, the driving forces – prosecutors, perps and defense lawyers – are middle-aged men from New York and Washington.

So, when you say that the U.S. Attorney in Alabama is one of the top ten corporate crime prosecutors in the country – and she’s a woman – the guys are going to gulp on their coffee and donuts.

But there she is – Alice Martin, sitting in Alabama, and shaking up the state.

They say she has higher political aspirations.

Eliot Spitzer wants to be Governor of New York.

Alice Martin wants to be Governor of Alabama.

And like Spitzer, she brings high profile criminal prosecutions – that rarely end up in prison time for the defendants.

She’s an adherent of the rule of prosecutors as politicians – don’t bite down too hard on the hand that feeds your political career.

But she knows how to bring cases, and settle them without inflicting too much pain.

She gets 14 former top HealthSouth executives to plead guilty and cooperate in the government’s ongoing criminal case against the company’s founder and former CEO, Richard Scrushy.

Ten of the 14 have been sentenced, but only one has spent time in jail.

And it’s a $2.7 billion dollar fraud.

The government alleges that Scrushy was in charge.

Fourteen of his underlings have plead guilty – but the company is not going to be held criminally responsible? How did that happen?

Well, one answer might be this: Bob Bennett, the lawyer for HealthSouth, went to U.S. Attorney Alice Martin earlier this year and turned over the store.

“At our first meeting, Mr. Bennett came in and said – HealthSouth wanted to waive its privileges,” Martin told Corporate Crime Reporter earlier this year. “He said – we want to cooperate, and we want to do whatever we can to help you determine who, what, when and why this fraud occurred. Here are my telephone numbers, including my home number, and you call me directly, because I want to make sure whatever you need gets done.”

Martin has also pursued criminal charges against executives involved in a massive fraud at failed shoe retailer Just for Feet.

In April, Martin brought criminal charges against McWane Inc., alleging that the company dumped millions of gallons of heavy metals into local waterways.

Martin has a BA in nursing from Vanderbilt University. She graduated from the University of Mississippi Law School in 1981. She spent more than ten years working in defense firms in Alabama and Mississippi before being appointed by President Bush to be the U.S. Attorney in 2001. (See “Interview with Alice Martin,” 17 Corporate Crime Reporter 44(12), November 17, 2003)

Patrick Meehan, U.S. Attorney, Philadelphia

Like the federal prosecutors office in Boston, the one in Philadelphia has a proclivity to go after health care fraud.

The reason – an assistant U.S. Attorney who specializes it in.

His name is James Sheehan.

And he has an expertise in the areas second to one. He’s also a friend of whistleblowers far and wide. In fact, the word on the street is – if you have a False Claims Act case, call Sheehan.

The False Claims Act says to citizens of the United States – if you have information about corporations that are defrauding the federal government, come forward, tell federal prosecutors about it, and if federal prosecutors can verify your claim, they will join with you and sue the corporation to recover the amount of money that the corporation defrauded from the United States.

If you can prove your case, and the government recovers the defrauded money, then you, ordinary citizen, will get a cut of the recovery – anywhere from 15 to 30 percent.

And so, whistleblowers with the inside scoop call Sheehan.

Patrick Meehan, the U.S. Attorney, in Philadelphia, apparently loves it.

He’ll take all Sheehan can shovel his way.

And there’s been a lot of shoveling lately.

Just this year, Meehan has successfully brought False Claims Act and fraud cases against Ernst & Young,

Rite Aid, and Medco Health Solutions.

And just last month, Schering Sales Corp., the sales and marketing subsidiary of drug manufacturer Schering-Plough Corporation, plead guilty to criminal charges and paid fine of $52.5 million, while Schering-Plough Corporation will pay more than $290 million to resolve civil liabilities stemming from its fraudulent pricing of Claritin, its blockbuster allergy medication.

The case was brought to Sheehan by Charles Alcorn, Beatrice Manning, and Raymond Pironti, Jr., three former employees of ITG, Inc. a subsidiary of Schering Plough.

As a result, the three will pocket $31,662,173.

Meehan is a 1986 graduate of Temple University Law School. He went on to be elected district attorney in Berks County, Pennsylvania and to work in private practice at Dilworth Paxon in Philadelphia. He currently serves on the President Corporate Fraud Task Force.

Robert Morgenthau, District Attorney, Manhattan, New York

At 82, he is arguably still one of the most feared men on Wall Street.
Robert Morgenthau, DA, Manhattan.

The prosecution of Tyco International’s CEO L. Dennis Kozlowski and other Tyco executives is the last in a long line of corporate crime prosecutions spanning four decades.

He’s still putting together a team of young lawyers needed to bring the crooks to justice.

"He really is the father of white-collar criminal prosecutions," Gary Naftalis, a Manhattan defense lawyer told USA Today last year. "He talked about crime in the suites being as important as crime in the streets. That was his line."

Morgenthau points to the 1969 convictions against accountants for Continental Vending Machines as a turning point.

He says that that case established a precedent that accountants may be held criminally liable for such action, even if the reports technically satisfy accounting standards.

He told USA Today that the case shook up the financial world because the informal policy at the time "was that lawyers and accountants did not get prosecuted criminally. It was considered 'too harsh.'"

Today, he runs a staff of more than 500 attorneys on a $70 million budget.
Much of the white collar case load is driven by John Moscow, his long time assistant who drove the BCCI prosecution and is now in charge of Tyco.

The vast majority of cases brought by his office are street crime cases. But it is the white collar cases that keep him in the news.

The mistrial of Kozlowski after a six-month trial was a blow to the office’s reputation.

Kozlowski and Tyco’s former top financial officer, Mark Swartz, are facing charges that they looted Tyco of $600 million.

Mark Belnick, the company’s former general counsel, was acquitted of charges last month.

But Morgenthau didn’t hesitate a moment before announcing that the case against Kozlowski and Swartz would be retried.

That case is scheduled for trial in Manhattan on January 16, 2005.

Eliot Spitzer, Attorney General, New York State

In the land of the blind, the one-eyed man is king.

And so, Eliot Spitzer, Attorney General of New York, is king of the corporate crime prosecutors.

Surely, no other prosecutor in the nation has the energy that moves Spitzer to bring cases against some of the nation’s largest companies.

Running far ahead of the field, Spitzer consistently outshines the staff of the Securities and Exchange Commission’s enforcement division and the Justice Department’s fraud section.

He’s blazed new trails by bringing to heel powerful companies for pollution, investment banks for market timing, nursing home owners for mistreating the elderly, pharmaceutical companies for ripping off taxpayers, and insurance companies engaged in illegal trading.

Like Rudolph Giuliani before him, Spitzer is using his position as a corporate crime buster to leapfrog to higher office.

Giuliani went from U.S. Attorney in Manhattan to Mayor of New York City.

Spitzer wants to be Governor of New York State – and of course, eventually President of the United States.

But while Giuliani’s goal was to put major white collar crooks behind bars – a goal he often achieved –


Spitzer’s m.o. is to attack the corporation, settle for major fines and behavioral changes, and let the individuals off with wrist slaps.

Spitzer is a master at turning criminal prosecutions into great ink – although scratch the surface and you see an enforcer knows how to play to the press without damaging the institutional perps.

Take the case of Merrill Lynch.

Merrill Lynch analysts were telling their customers -- trust me, buy this stock, this stock is highly rated.


And then they would turn around and e-mail their buddies – hey, this stock is not worth beans.

Spitzer got a hold of the e-mails, brought an enforcement action in 2002, went before the television cameras and announced to the world that Merrill will pay $100 million to settle the case. But Spitzer doesn't get Merrill to admit wrongdoing. He later admitted that had he forced Merrill to admit wrongdoing, the firm would have gone kaput. Just like Arthur Andersen.

Or what about the lawsuit Spitzer brought against Richard Grasso, former CEO of the New York Stock Exchange for taking more compensation than was justified under New York’s non-profit law?

Spitzer charged Grasso and Grasso’s ally, Ken Langone, but not other members of the board, and surely not Carl McCall, the New York State Comptroller, a close allies of Spitzer’s, who has helped him raise millions for his run for Governor.

This is only to say that the cautious Spitzer is in fact well within the tradition of prosecutors who wade into the hazardous waters of corporate crime, but make sure they don’t go out too far for fear of being chomped on.

Political careers are at stake.

Michael Sullivan, U.S. Attorney, Boston, Massachusetts

The U.S. Attorney’s office in Boston doesn’t bring many corporate crime cases against major U.S. companies.

But when they do –

In June, Sullivan brought a major health care fraud case against Warner Lambert and secured a $240 million criminal fine.

In 2003, they brought a major false claims act case against Bayer. The company pled guilty, paid a $5.5 million criminal fine and $251 million to settle civil charges that it ripped off the government.

In 2001, the office brought a major case against TAP Pharmaceuticals. The company paid $875 million to settle criminal and civil charges that it inflated the price of a top-selling prostate cancer drug.

See a pattern?

You got it. Sullivan’s office specializes in health care fraud.

Sullivan’s key to success? Two aggressive assistants who know what they’re talking about.

Michael Loucks and Susan Winkler head Sullivan’s heath care fraud unit.

Whistleblowers in the pharmaceutical industry know where to turn to. And it’s Boston.

It’s true, the majority of cases that fill Sullivan’s docket are street crimes – like this gem – Italian Sex

Offender Ordered to Prison for Illegal Re-Entry.

But when Sullivan decides to go after corporate crime, unlike most of his colleagues, he doesn’t hesitate to chop at the top.

Sullivan was appointed U.S. Attorney in Boston in 2001 by President Bush. He is a former district attorney for Plymouth County, a former member of the Massachusetts house of representatives, and a graduate of the Suffolk University School of Law.

Debra Yang, U.S. Attorney, Los Angeles, California

You can get a sense of a prosecutor’s priorities by looking at their web sites.

Most are filled with drug and street crime cases.

Debra Yang’s is filled with white collar and corporate crime cases.

In fact, a rough count found that fully 80 percent of the cases announced on Wang’s web site dealt with white collar crimes of one type or another (84 of 105 cases in 2004).

That’s probably highest among U.S. Attorney’s offices – although it is difficult to tell, especially since some don’t even have web sites – the U.S. Attorney in Pittsburgh, for example, still does not have one – and others, like the U.S. Attorney in Chicago – are not kept up to date – with only one entry posted for 2004.

Admittedly, most of the cases brought by Yang’s office are not against major American corporations.

But Yang did ride the post-911 anti-French wave by launching a heroic battle against Credit Lyonnais, a

giant French government owned insurer accused of illegally acquiring the assets of a defunct California life insurer – Executive Life.

Credit Lyonnais hired a slew of corporate defense lawyers and lobbyists, but they were unable to budge Yang, who forced the company and its executives into a series of guilty pleas for making false statements and forced them to pay more than $770 million in criminal and other penalties.

Some think, given the full court press that the French put on Yang’s office, she actually made the difference. With her, a criminal conviction. Without her, none.

But policyholders, who lost $4 billion, say that Wang pulled her punches by not stripping the company of its license to do business in the United States.

But given the lack of initiative among the 94 U.S. Attorneys in tackling corporate and white collar crime, it’s a joy to see a U.S. Attorney who at least tries to take it seriously.

Wang is the first Asian American women U.S. Attorney. She’s a member of President Bush’s Corporate Fraud Task Force and a 1985 graduate of the Boston College School of Law.