THERE is no recession for the white-collar criminal-defense bar. Leading white-collar-crime attorneys are awash in litigation and major law firms are gearing up for business defending corporations and their executives against criminal and civil prosecution.
Massive scandals, such as the the savings-and-loan crisis, the Salomon Brothers securities price-fixing scheme, the money-laundering activities of the Bank of Credit and Commerce International (BCCI), plus new federal "Guidelines for Sentencing" that became law in November are generating more prosecutions, say legal experts.
The decade of the '80s heightened public concern about white-collar crime, says Whitney Adams, chairman of the white-collar-crime committee of the American Bar Association. Corrupt business executives, politicians, corporations, labor unions, and even universities are "politically, an attractive issue for prosecution today," she says.
The new federal guidelines pack a one-two legal punch for law firms, says David Zarnow, a former prosecutor and partner in the white-collar division of the New York-based Skadden, Arps, Slate, Meagher & Flom, one of the largest and most profitable law firms in the world. The guidelines not only increase the potential number of white-collar and corporate clients, but also extend the reach of prosecutors in criminal cases, he says. They substantially increase the severity of the fines imposed on corporations convicted of a wide range of federal offenses - for example, mail, wire, securities, tax, and government-contract fraud.
Just five years ago, criminal-defense attorneys were in specialized firms or practicing alone, says Mr. Zarnow. Now, many of the leading criminal-defense attorneys have joined large law firms.
Prosecutions are likely to increase because of two important criteria that "get prosecutors involved" stemming from the new guidelines, says Ms. Adams. A prosecutor asks two questions, she says:What is the likelihood of winning? What is the likelihood of getting good sanctions? The sanctions now are specific, focus on compliance, and carry stiff penalities.
Techniques and prosecutorial tools developed for the war on drugs, especially the Racketeer Influenced and Corrupt Organizations Act (RICO) "pushed the envelope out," Zarnow says. "We're living …