Crime in the Suites: An Analyis of Current Issues in White Collar Defense
Posts Tagged ‘Surveillance’
Nov 03

ACLU Wins FOIA Appeal on Prosecutors’ Use of Cell Phone Location Data

For some time now, the American Civil Liberties Union has been concerned about some federal prosecutors’ practice of seeking court orders to track the location of people’s cell phones without probable cause, arguing that this practice infringes on privacy rights and violates the Fourth Amendment. Last month, the ACLU claimed victory in one of several cases making its way through the court system.

After a four-year battle, the U.S. Court of Appeals for the D.C. Circuit ordered the Department of Justice to comply with a 2007 Freedom of Information Act request from the ACLU and turn over the names and docket numbers of numerous cases in which the government accessed cell phone location data without probable cause or a warrant.

Using a GPS chip inside a cell phone, law enforcement agency can locate a person to within about 30 feet. They are also able to gather less exact location data by tracing mobile phone signals as they ping off cell towers. In 2007, the ACLU filed a FOIA request seeking the policies and procedures used by the DOJ in obtaining this cell phone data.

This request was part of a campaign undertaken by 34 ACLU affiliates that filed more than 375 requests in 31 states with law enforcement agencies large and small, seeking to uncover when, why, and how law enforcers were using cell phone location data to track people. Applications by law enforcement for court orders tracking the location of people’s cell phones are generally filed under seal, and the court’s response to such requests is also generally secret. The result, the ACLU argues, is that the law governing when the government may secretly track a person’s cell phone is itself largely secret.

When the government refused to respond adequately to the FOIA request, the ACLU, along with the Electronic Frontier Foundation, sued for the case names and docket numbers for cases where individuals were criminally prosecuted after cell phone location data was accessed without a warrant. U.S. District Judge James Robertson ordered the DOJ to produce the information, at least in cases that ended in a conviction or guilty plea. The DOJ appealed, but last month, the U.S. Court of Appeals for the D.C. Circuit upheld the lower court and ordered the DOJ to make that information public. The ACLU had also requested information on cases where the defendant was not convicted. The court sent that question back to the District Court, and it remains unresolved.

The DOJ could possibly appeal to the Supreme Court, which already has agreed to consider another privacy case involving GPS technology.  We have written about that case before. In that case, which will be argued later this year, the issue is whether police should have obtained a warrant before attaching a GPS device to a suspect’s vehicle.

With advancing technology, this type of case will continue to dot the legal landscape, as courts try to balance law enforcement needs with individual privacy rights. Given the importance of these cases, legislation governing cell phone tracking is in order.

Apr 13

An Interview with David Deitch, New Ifrah Law Partner

On April 1, 2011, David Deitch started work as a partner at the Ifrah Law Firm. David is an experienced trial lawyer and former Department of Justice counterterrorism prosecutor. Because he will now be a regular contributor to this blog, the editor of Crime in the Suites conducted this brief interview to introduce David to our readers.  Please feel free to ask him your own questions in the comments section and at the end of this post.

 Q.  Can you tell us a little about your background — where have you worked, and what kinds of cases have you tried?

 A. In the 20-plus years since I graduated law school, the largest portion of my career has been spent as a state and federal prosecutor.  I worked for the Manhattan District Attorney’s Office in the early 1990s, and later worked as a federal prosecutor, as an Associate Independent Counsel, as an Assistant United States Attorney, and as a trial lawyer for the Department of Justice’s Counterterrorism Section.  I have also worked for law firms such as Covington & Burling, Schulte Roth & Zabel, and Janis Schuelke & Wechsler.

 Most of my trial work has involved criminal cases.  The most prominent cases were the two trials for which I was co-lead counsel while I was with the Counterterrorism Section, in which defendants were charged with providing material support to terrorist organizations.

 Q. In addition to counterterrorism cases, what other types of white-collar cases have you worked on?

 A. My background in white-collar criminal law comes from two sources. First, my work on counterterrorism cases often included a lot of the same kinds of investigative processes, issues and charges that are usually associated with white-collar crime.  For example, in many cases, the focus of investigation and prosecution was on the illegal movement of money, and the charges under consideration involved money laundering.  Other cases may have involved other facts and charges that are not as different from traditional white-collar work as you might expect.  Second, since I left the government in January 2007, I have been involved with a wide variety of investigations and prosecutions of white-collar criminal cases.  These included internal investigations undertaken on behalf of the boards of directors of large corporations, as well as representation of individuals charged with violating federal criminal law.  The subjects of these matters included wire fraud, bribery and gratuities violations, violations of the Foreign Corrupt Practices Act, and other federal crimes, as well as forfeiture statutes.

 Q. Why did you choose to join Ifrah Law?

 A.  I joined Ifrah Law for a number of reasons.  The firm offers attentive, expert and effective legal representation to its clients, and these are the qualities of service that I have always sought to bring to my clients.  Ifrah Law also has a strong client base in a number of different industries. I am looking forward to a long and successful relationship with the firm.

Q. What do you see as some of the major trends in white-collar law and litigation in this decade?

 There are a few prominent trends. The Department of Justice has made no secret about its vigorous efforts to seek out and prosecute companies and individuals who violate the Foreign Corrupt Practices Act, and law enforcement agencies at all levels are looking hard at some of the economic activity involving mortgages and investments that are viewed as being related to the downturn in the economy of the last few years.

These vigorous efforts at enforcement have also seen the use of investigative tools in white-collar cases that were once traditionally reserved for investigations into other kinds of crimes.  The best example of that is the use of wiretaps in the Rajratnam insider trading case.  As readers of the Crime in the Suites blog may know, Jeff Ifrah has been quoted in the media discussing that matter.

 Q. Can you mention some steps that companies can take, as a matter of corporate policy, to avoid finding themselves in the cross hairs of prosecutors?

A. There are certainly no guarantees, but companies must train their employees about the rules and regulations that govern their employees’ activities.  Then, I suggest that companies institute a vigorous compliance program that reinforces that training and create systems designed to identify employees who violate the law.  Finally, if a company receives information that an employee has violated the law, it should move promptly to investigate the allegations so that company counsel can advise the company on the best course of action to protect the company’s interests.

Feb 24

The ‘Delete’ Key Doesn’t Help These Insider-Trading Defendants

On February 8, 2011, the U.S. Attorney in Manhattan and the FBI announced some new indictments in a massive probe of insider trading on Wall Street. They charge two defendants not only with conspiracy to commit securities fraud but also with obstruction of justice for destroying evidence.

The five-page release issued that day by the government reads like something out of a TV crime drama, complete with turncoat informants, telltale e-mail messages, and late-night dumpster trips in a failed effort to hide evidence.

In just one instance of alleged insider trading, two hedge funds pulled in $2 million in profits nearly overnight.

“When you are paying insiders for earnings data before it’s announced, that isn’t ‘research.’ That’s cheating,” said Janice K. Fedarcyk, assistant director-in-charge of the FBI’s New York office in announcing the indictments. “And the efforts to destroy evidence are laid out largely in the defendants’ own words. For all their presumed sophistication, the defendants lacked a mobster’s instinct for conversational discretion.”

In fact, Samir Barai and Donald Longueuil, the two hedge fund managers who were charged, seemed to have no hesitation to lay out an electronic paper trail leading to their allegedly illegal activities.

For example, Barai sent Jason Pflaum, a co-worker who, unbeknownst to Barai, was a government informant, a BlackBerry Messenger message instructing him to “shred as much as u can,” “put all ur data files onto an encrypted drive,” and “delete all emails from” a particular person.

These traders seemed to have no idea that their words would soon be held against them. They thought that hitting the “delete” key was all they had to do to conceal their conduct. Actually, of course, no such communication is safe from a well-crafted government investigation.

Pflaum and another informant pleaded guilty, also on February 8, to one count each of securities fraud and of conspiracy to commit securities fraud.

This probe is far from over, and we will be looking at the government’s tactics and at the defendants’ arguments carefully as it goes on.

Jul 13

Is NSA Becoming Too Intrusive in Efforts to Stop Cyber-Crime?

The Wall Street Journal has just reported that the National Security Agency is planning to deploy electronic “sensors” in the private computer networks of major companies around the nation. The idea is to detect cyber-attacks by outside forces against companies involved in critical infrastructure like electric or nuclear plants.

Cyber-terrorism is a real threat, and the NSA is the only government agency, probably the only entity of any sort in the nation, that is truly equipped to monitor it. According to the article, national security officials are concerned about possible Chinese and Russian surveillance of our crucial computer networks.

However, the “Big Brother” aspect of this program is inescapable. Like many such programs, it began with a piecemeal effort and with the establishment by the government of co-operative relationships with private industry. But where will the program end? Conceivably, the government will soon routinely gain access to the private data of dozens of companies. Although it will surely pledge not to misuse this information, these pledges can’t always be trusted.

And the article notes that while the government can’t force any company to permit “sensors” to be introduced, it “can provide incentives to urge them to cooperate, particularly if the government already buys services from that company.” That would include pretty much every government contractor – or in other words, every major company.

A few days ago, we noted in this blog that the FBI is now investigating possible instances of white-collar crime by deploying its massive electronic surveillance capacity.

Now, with the NSA’s involvement in cyber-defense, we are again seeing the tentacles of government in the private sector, in the name of a good cause. This is troubling indeed.

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About Ifrah Law

Crime in the Suites is authored by the Ifrah Law Firm, a Washington DC-based law firm specializing in the defense of government investigations and litigation. Our client base spans many regulated industries, particularly e-business, e-commerce, government contracts, gaming and healthcare.

Ifrah Law focuses on federal criminal defense, government contract defense and procurement, health care, and financial services litigation and fraud defense. Further, the firm's E-Commerce attorneys and internet marketing attorneys are leaders in internet advertising, data privacy, online fraud and abuse law, iGaming law.

The commentary and cases included in this blog are contributed by founding partner Jeff Ifrah, partners Michelle Cohen and George Calhoun, counsels Jeff Hamlin and Drew Barnholtz, and associates Rachel Hirsch, Nicole Kardell, Steven Eichorn, David Yellin, and Jessica Feil. These posts are edited by Jeff Ifrah. We look forward to hearing your thoughts and comments!

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