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Va governor’s bribery conviction should be overturned

Virginia Governor Bob McDonnell was convicted last year of honest services wire fraud, a vague law that the Supreme Court saved from constitutional challenge by redefining it to outlaw bribery and kickbacks by public officials. Unlike the standard anti-political bribery statute, 18 USC 201, honest services wire fraud covers misconduct by state officials. (There was already a federal law that typically applied to state officials, 18 USC 666–but no matter, the Supreme Court did what it did.)

So Bob McDonnell was charged with the honest devices wire fraud, which required the government to prove that he corruptly accepted personal payments in exchange for his performance of an “official act.”

At trial, the government argued that the following acts were “official acts”:

The government argued that these acts were official acts because the governor’s ultimate aim was to obtain state government funding for the businessman’s business.

It bears mentioning that the businessman provided numerous things of value to the governor and his wife. But that alone is far from federal bribery. In fact, in Virginia, there is no prohibition on giving gifts to government officials.

So the issue is not whether the conduct is morally correct, but rather whether Mr. McDonnell could have reasonably foreseen that the acts listed above–setting up meetings an so forth–constitute “official acts” under federal bribery law.

A foundational principle of our democracy is that a person cannot go to prison for conduct if they could not have reasonably foreseen that the behavior was criminal. This fair warning requirement of due process is violated most often in public prosecutions, where prosecutors know that the public will find the political sausage-making distasteful.  It is for this reason that Justice Scalia warned that honest services wire fraud statute “invites abuse by headline-grabbing prosecutors in pursuit of local officials, state legislators and corporate C.E.O.’s who engage in any manner of unappealing or ethically questionable conduct.”

Because Virginia law does not prohibit the payments in question, and because a reasonable person would not have fair warning that that above acts are official acts–like decisions to award a contract to a certain firm or to veto a law–31 current governors; 60 former state attorneys general; 13 former federal officials, including two former U.S. attorneys general and former legal counsels to every president starting with Ronald Reagan; and three law professors from Harvard University and the University of Virginia all have urged the Supreme Court to overturn McDonnell’s conviction.

We agree. The Supreme Court is poised to consider tomorrow whether to take up the case. We will continue to follow this important case in the area of political corruption law.

Here is a WSJ article on the topic, and here’s George Will blogging for the Washington Post.

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The Raleigh criminal defense firm of CHESHIRE PARKER SCHNEIDER & BRYAN handles all types of public corruption cases, including bribery and honest services wire fraud charges. If you are facing prosecution, contact one of our Raleigh criminal defense lawyers today.

 

Federal Government passes rules allowing asset freezes for computer hacking suspects

In April 2015, the president created new rules allowing the federal government to freeze the assets of those suspected to be involved in high-level computer hacking.  (Executive Order; RT.Com article).

On December 31, 2015, the Treasury Department published abbreviated rules for imposing these sanctions, indicating that a comprehensive set of rules will be published at a later date.  (Federal Register).

The new regulations not only govern the blocking of transfers of funds by those suspected of computer hacking, but they also govern how those suspects can pay their lawyers.  (Federal Register at § 578.506, 507).  And lawyers who accept payment to represent suspects whose funds have been blocked must provide an annual report to the Department of the Treasury outlining “The individual or entity from whom the funds originated and the amount of funds received; and . . . (A) The names of any individuals or entities providing related services to the U.S. person receiving payment in connection with authorized legal services, such as private investigators or expert witnesses; (B) A general description of the services provided; and (C) The amount of funds paid in connection with such services.”  (§ 578.507(b)).

The executive order and these rules indicate the increasingly drastic measures the federal government is taking to prevent computer hacking, cyberattacks, theft of trade secrets, and other computer crimes.

Asset seizures are allowed under the executive order whenever a person is suspected of any direct or indirect involvement in, responsibility for, or complicity in a cyberattack originating from outside the United States that has a significant impact on computer systems within the United States or involves the theft of trade secrets.

Although the executive order purports to limit the application of these rules to computer hacking that is “reasonably likely to result in, or have materially contributed to, a significant threat to the national security, foreign policy, or economic health or financial stability of the United States,” this language is vague enough to apply to virtually anyone suspected of any involvement in computer hacking that is believed to have an international component.

With this increased federal government focus on computer hacking and theft of trade secrets, it is important to contact a Raleigh white-collar defense lawyer immediately if you believe you are being investigated.

 

Federal government will no longer share seized assets with local police

In the wake of strong criticism of the federal civil asset forfeiture program, the United States Department of Justice has announced that it has ended its so-called “Equitable Sharing” program that allows local police to seize property from people and businesses using the permissive federal asset forfeiture procedures. (WaPo).

This program led to widespread abuses of the already questionable area of civil asset forfeiture because it created a monetary incentive for police to seize property. It’s widespread use resulted in charges that law enforcement agencies were “policing for profit”–targeting people and companies in order to boost their departments’ budgets, rather than focusing primarily on protecting the public from crime.  The fact that the Feds took more from people in 2014 than burglars did (CheshireParker) suggests that these incentives have significantly altered law enforcement priorities at the federal level. And it is reasonable to expect that the same has happened at local police departments under the Equitable Sharing program.

USDOJ has indicated that the shutdown of the program is only temporary. So it remains to be seen what long term impact the move will have. Hopefully, it will curb the abuses of asset forfeiture programs–although it may spur a call by local police to expand state civil forfeiture laws.

If the government has seized property from you or your business, contact one of our experienced Raleigh asset forfeiture lawyers today.

 

Feds seize more through asset forfeiture than burglars take

In 2014, the federal government took more property from American citizens through asset forfeiture than burglars did.  According to the Washington Post (link), the federal government deposited more than $5 billion into their asset forfeiture funds, whereas burglary losses were only $3.5 billion.

The following is a Washington Post graph showing the tremendous growth of seizures through asset forfeiture over the last 10 years–from less than $1 billion seized in 2004, up to over $5 billion last year.

WaPo Graph shows the growth in asset forfeiture seizures by the federal government from 2004-2014

WaPo Graph shows the growth in asset forfeiture seizures by the federal government from 2004-2014

This tremendous growth in a particular area of criminal law is somewhat rare.  And because asset forfeiture was largely an afterthought in criminal defense cases, few criminal defense lawyers have developed extensive experience handling these complex cases.

If your property has been seized by the government, or if you have received a notice of forfeiture, contact one of our experienced Raleigh asset forfeiture lawyers today.

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Read More about our Raleigh Asset Forfeiture lawyers

 

Same-Sex Marriage and Divorce

The United States Supreme Court legalized same sex marriage in a landmark decision, and since then, many states have made changes to their existing marriage laws to accommodate this decision. With the legalization of marriage comes the legalization of same sex divorce, which has created challenges for lawmakers and attorneys nationwide as they determine how to best handle the split of a same sex couple.

North Carolina Criteria

In North Carolina, all divorcing couples are subject to the same laws. At least one person must have lived in North Carolina for at least six months, regardless of where the marriage license was issued. Each couple must go through one year of separation before they can file a petition for divorce, and at the time of separation, at least one person must have intended to make a permanent break in the marriage.  However, you may resolve all other issues arising out of your marriage prior to your divorce.

Alimony Determinations

It’s often difficult to determine who is the supporting spouse in today’s society, particularly where both partners hold jobs and contribute to the financial wellbeing of their household. If you are considered the supporting spouse, you may be required to pay alimony, so long as your ex-spouse is considered to be dependent and so long as there is the ability to pay alimony.

It is possible to resolve your separation without an alimony obligation if both parties agree in a Consent Order or a Separation Agreement.   Additionally, some couples may have stipulations written into their prenuptial agreements that excuse each spouse from financial obligations to the other in case of a divorce.

Division of Property

In North Carolina, the marital dissolution laws allow the court to divide any property belonging to a divorcing couple if the couple cannot reach an agreement on their own. Although many people believe that a division of marital assets and debts is performed as an equal split between two spouses, this is not always the case, but it is the starting presumption.

Also, some property may have been inherited or given to only one spouse by a third party or some property may have mixed characteristics, as can often be the case with retirement accounts if they have been contributed to before and/or after the marriage.  Debt may not be marital if it was not incurred for a marital purpose.  Additionally, it may not be feasible, for economic reasons, legal reasons or business reasons, to divide certain items of property, such as a family business.  In those cases, it may be more proper to offset the value of the business with other assets.

How is Custody Decided?

There is no presumption in North Carolina as to who shall be the primary custodian of a child.  Instead, North Carolina uses a best interest determination between two legal parents.  As a same –sex couple the landscape is still a bit complicated.  If both of your names are on the child’s birth certificate, the same legal standard will apply in your custodial determination.

If the child is biologically your partner’s child, you will need to consider a step-parent adoption to be on the same legal footing as the biological parent.  If you do not have your name on the birth certificate, there are precedent cases in North Carolina that may apply to your facts and allow you to seek custody/visitation based on the best interest of the child.  This area of law can be very complicated, so please seek legal counsel prior to separating.

Call An Attorney

If you are considering divorcing your spouse, you need the help of a divorce attorney. At Cheshire, Parker, Schneider, and Bryan, our Raleigh divorce lawyers represent divorcing same-sex couples in North Carolina.

 

Non-Physical Domestic Violence

Domestic violence is much more than physical violence.  Domestic violence is riddled with stereotypes.

When we think about domestic violence, we often focus on the violence which may consist of a husband lashing out at his wife, a girlfriend throwing a blender at her boyfriend, one spouse hitting the other with a baseball bat and other types of physical violence.  These examples are more in line with stereotypical abusers.

Domestic violence is also sexual coercion; financial control; verbal abuse; isolation from friends, family, and co-workers; denigration; humiliation; controlling decisions; stifling independence; monitoring whereabouts and more.   These are actions that are all about power and control.

Many Perpetrators of Domestic Violence Never Use Physical Violence

A string of controlling and domineering actions depletes a partner’s ability to develop individually; to improve education, financial independence, professional advancement or have much of a friend or support network. The abuser twists the partner’s mind, plays games and is confusing.  The abuser breaks promises, switches tactics, makes excuses and blames the partner.  One by one, a partner’s options for personal growth and independence are taken away or minimized – never once by using physical force.

There is public outrage about physical violence. Non-physical power and over-controlling abuse are invisible. There is less public understanding about non-physical domestic violence.  This lack of understanding means the victim cannot define what is happening.

People who experience a systematic pattern of psychological abuse and control suffer from psychological wounds that can be longer-lasting than the wounds from physical violence.  Commonly, where the dynamic of the relationship is about power and control without violence, there is no honeymoon period of remorse and renewed promises. Instead, there is a consistent effort at total domination.

Domestic Violence Protective Orders

North Carolina law defines civil domestic violence as any instance where a person with whom you have had a personal relationship takes any of the below actions against you or a minor child:

A victim may obtain a Domestic Violence Protective Order against a partner who commits any act of domestic violence – physical or non-physical.  A Domestic Violence Protective Order is a CIVIL remedy, although there may be related criminal penalties that go hand-in-hand with domestic violence.

“Harassment” for the purpose of obtaining a Protective Order, means: “knowing conduct, including written or printed communication or transmission, telephone, cellular, or other wireless telephonic communication, facsimile transmission, pager messages or transmissions, answering machine or voice mail messages or transmissions, and electronic mail messages or other computerized or electronic transmissions directed at a specific person that torments, terrorizes, or terrifies that person and that serves no legitimate purpose such that a reasonable person in the victim’s circumstances would feel harassed; and that the victim suffer significant mental suffering or distress that may, but does not necessarily, require medical or other professional treatment or counseling.”

In our age of electronics and technology, a perpetrator can commit acts of domestic violation by cyber harassment.  A partner can be monitored electronically; harassed online through social media or via email or other means.  North Carolina has additional remedies on the criminal law side for cyberstalking and revenge porn.

Protecting Against All Violence

Acts of non-physical abuse are just as dangerous and damaging as physical violence — sometimes even more so.  Victims may feel like they have no options if they’re suffering from non-physical domestic violence, but they need protection all the same.

For more information on stalking, cyberstalking and family law, contact the Raleigh domestic violence attorneys at Cheshire, Parker, Schneider, and Bryan today. We represent anyone who has been a victim of domestic violence (physical and otherwise) and needs help getting justice. Call us today for a consultation on your case.

 

Raleigh federal criminal defense attorneys discuss government misconduct in Silk Road investigation

You may remember Silk Road, the “deep web” black market website where customers could purchase everything from drugs and guns to the services of hit men.  Its founder, known as “Dread Pirate Roberts,” was a 29-year-old from Texas with an undergraduate degree in physics, who went to a prestigious graduate program in materials science at Penn State.  (WaPo).  He was ultimately convicted at a trial and sentenced to life in prison.

However, this conviction may be in question with the recent disclosure (known to the government at the time of the trial) that the lead DEA and Secret Service agents involved in the investigation extorted and stole hundreds of thousands of dollars worth of Bitcoins, and were also attempting to obtain employment from potential suspects and witnesses, all throughout the course of the investigation.  (Forbes).

The federal criminal complaint by the Public Integrity Section of the Department of Justice alleges that these lead agents “abused their positions as federal agents and engaged in a scheme to defraud a variety of third-parties, the public, and the government, all for their own financial enrichment.”  (Federal Criminal Complaint).

Specifically, as Forbes describes it:

The criminal complaint against former DEA agent Carl Mark Force IV and former Secret Service agent Shaun Bridges alleges money laundering, wire fraud, theft of government property, and more.  But more shockingly, it tells the story of a sprawling case tainted by an unbelievable web of corruption.  A state’s witness took the fall for an agent’s theft, thus becoming the target for a murder-for-hire—a murder that was then faked by the same agent. The Silk Road case was compromised again and again as Force and Bridges allegedly took every opportunity to embezzle and steal money. With so much bitcoin on their hands, the two had to coax various bitcoin and payments companies to help convert their ill-gotten gains to dollars. When companies resisted, investigations were launched, subpoenas were issued, and civil forfeitures were sought in retaliation.

This government retaliation targeted Venmo, among other companies, one of which received a note from Force after having their funds seized stating, “told you [you] should have partnered with me!”

Lawyers for Silk Road’s founder unsuccessfully moved for a new trial, arguing that much of the information alleged in the criminal complaint was exculpatory yet not disclosed to them sufficiently in advance of trial.  His case in now on appeal.  A website http://freeross.org/ has been set up to aid in his defense.

The information alleged in the criminal complaint against the former DEA and Secret Service agents, if true, shows the immense power federal law enforcement officers have and illustrates why, as Raleigh federal criminal defense attorneys, we dig deep to uncover any government misconduct that may have occurred in a federal criminal investigation.  If you believe you have been wronged by government misconduct, call one of our Raleigh federal criminal defense attorneys at (919) 833-3114 to schedule an appointment.

 

Congress Says Criminal Justice Reform Legislation Likely Next Year

Last week, President Obama met with numerous congressional leaders of both parties to encourage them to move forward with pending legislation that would reform the federal criminal justice system.  (WaPo, Sentencing Law and Policy Blog).  Both the House and Senate have considered numerous proposals, some of which include provisions that would reduce the mandatory minimum sentences for certain drug crimes; others would add provisions to nearly all federal offenses that require the government to prove, at least, that the defendant “knew, or had reason to believe, that the conduct was unlawful”; and others would eliminate federal offenses that criminalize “trivial conduct.”

Although much still needs to be decided, the Senate Minority Whip, Richard Durbin, believes that congress has “a good chance” of passing criminal justice reform legislation in early 2016 and sending it to the president “before the midpoint of the year.”  Senate Judiciary Committee Chairman Charles Grassley also seemed optimistic.

Our hard-hitting Raleigh criminal defense lawyers include Joseph Cheshire, Bradley Bannon, Collin Cook, Elliot Abrams, and Keat Wiles. We will continue to monitor these developments in criminal justice reform to see how these changes may benefit our clients.

We have a reputation for fighting for justice and of winning tough drug cases.  The earlier you retain a qualified lawyer, the better your chances of a successful outcome to your drug offense case.  Our Raleigh drug crime lawyers lodge a thorough investigation to gather crucial evidence for motions to suppress whenever possible. This hard-hitting approach can often keep unlawfully obtained damaging evidence out of court. Call Cheshire Parker Schneider & Bryan at (919) 833-3114 to schedule an appointment.

 

Raleigh criminal defense lawyer blogs about cell phone tracking

Raleigh criminal defense lawyer Elliot Abrams authored an article for the North Carolina Advocates for Justice regarding cell phone tracking by police.  The full text is provided below:

Your Right to Privacy in the Digital Age

In 1976, the United States Supreme Court created a rule that, if strictly applied today, would destroy privacy as we know it.  The 1976 case was Miller v. United States, in which the Court held that people have no Fourth Amendment right to privacy in their bank records because those records were disclosed to a third party (the bank).  This rule, known as the third party doctrine, essentially established that constitutional privacy rights depend on absolute secrecy of information.  Any information disclosed to a third party, regardless of the purpose of the disclosure, is not protected by the Fourth Amendment.

Think: every gmail you draft is disclosed to google, so even your private thoughts, your drafts, your rants that you never even dreamed of sending are not “secret” and thus not private under the third party doctrine.  Every television show you watch, every website you visit or search term you enter, and virtually every place you visit while carrying your cell phone, since your phone’s location is logged somewhere on the internet and/or by your cell phone service provider—all of that information is disclosed to a third party and thus is entitled to no Fourth Amendment protection under a strict application of the third party doctrine.

Fortunately, courts have begun to recognize that, as Justice Sotomayor wrote, “[t]his approach is ill-suited to the digital age[.]”   Even at the time of its creation Justice Marshall refused to buy in, saying that he “would not assume that all information voluntarily disclosed to some member of the public for a limited purpose is, for that reason alone, disentitled to Fourth Amendment protection.”

The North Carolina Court of Appeals had an opportunity earlier this year to bolster privacy protections in the digital age in State v. Perry.  Unfortunately, in writing for the majority, Judge Tyson went back to 1976, holding that a person has no reasonable expectation of privacy in their cell phone’s location information once that information has been obtained by the cell phone service provider—a belief that would startle most cell phone users.

As we increasingly interpose technology into our daily routines—wearing fitness bands and Apple watches, for example—the law will need to adapt to “assure preservation of that degree of privacy against government that existed when the Fourth Amendment was adopted.”  That is, after all, the underlying principle of Fourth Amendment jurisprudence.  Hopefully the North Carolina Supreme Court will look toward the future, rather than 50 years in the past, in considering whether to uphold or reverse Judge Tyson’s decision.

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Elliot S. Abrams is a Raleigh criminal defense lawyer with the law firm Cheshire Parker Schneider & Bryan, PLLC.  Elliot represents people charged with federal and state criminal offenses, public officials targeted by government ethics investigations, and licensed professionals facing professional discipline. Elliot cares deeply about his clients and stands up for them in and out of court.  If you or a loved one are in need of legal help, feel free to call him at 919-833-3114.

 

 

Ex-law clerk pleads guilty in major insider trading case

A former clerk of an international law firm pled guilty to insider trading last week.  According to Justice.gov the clerk obtained confidential insider information (also known as “material nonpublic information”) related to mergers, acquisitions and stock purchases and used it to profit on his personal transactions.  He is also alleged to have passed this insider information to bankers who personally profited from this information as well.

The ex-law clerk was not involved with the transactions on behalf of the firm.  Rather, he apparently accessed the information through the firm’s computer network by performing organic searches on topics such as “merger agreement,” “bid letter,” “engagement letter,” and “due diligence.”

According to the FBI by October 2013, the clerk made profits of about $168,000 on 13 planned corporate transactions.  In March he was charged with security fraud and conspiracy.  In September he rejected a previous plea offer.  He now faces the possibility of 20 years in prison and a $5 million fine for the security fraud charge, along with an additional five years in prison and a $250,000 fine for the conspiracy charge.

The other two conspirators are awaiting sentencing after pleading guilty, one of whom has been ordered to pay back bonuses he received of close to $3 million.

Although there has been a great deal of discussion about insider trading law recently due to a new case out of the Second Circuit, nbsp; link, it appears that those issues were not present in this case.

At Cheshire Parker Schneider & Bryan our Raleigh federal criminal defense attorneys represent anyone charged with insider trading or other fraud offenses.  If you or a loved one are facing such charges, call us for a free consultation today.

(Source:  Law360)

 

 

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