Lessons of The Am Law 100:Revenues and profits at the nation’s highest-grossing law firms grew by healthy margins in 2006. Same old story? Not quite….

By Aric Press and John O’connor
The American Lawyer
May 1, 2007

On the surface, at least, it’s the same happy story. New records galore: Gross revenue up 11.4 percent, profits per partner up 13.4 percent, revenue per lawyer up 7.3 percent, which is to say, at a clip exceeding the annual hike in billing rates. Times are so good for the men and women who own Am Law 100 firms that those who snared profits of a mere million dollars were below par: The mean was $1.2 million; the average among firms headquartered in New York, an astonishing $2.05 million.

For more see this link.

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Email Trails Suggests Gatekeepers Tasted Forbidden Fruit and SEC Files Charges Against Apple’s Former General Counsel and Chief Financial Officer

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Based on an apparently inculpatory email trail discovered in an ongoing SEC investigation, the government has filed new charges against two former senior executives of Apple, Inc. in a matter involving improper stock option backdating.

The SEC accused former General Counsel Nancy R. Heinen of participating in the fraudulent backdating of options granted to Apple’s top officers that caused the company to underreport its expenses by nearly $40 million. The Commission’s complaint alleges that Heinen, of Portola Valley, California, caused Apple to backdate two large options grants to senior executives of Apple — a February 2001 grant of 4.8 million options to Apple’s Executive Team and a December 2001 grant of 7.5 million options to Apple Chief Executive Officer Steve Jobs — and altered company records to conceal the fraud.

For more on this development, see SEC v. Heinen et al.

Sunrise Suspends CFO Over Missing Records

By David S. Hilzenrath
Washington Post Staff Writer
Thursday, April 26, 2007; Page D01

Sunrise Senior Living said yesterday that it suspended chief financial officer Bradley B. Rush with pay for allegedly destroying records the company told executives to preserve for an investigation of stock sales by insiders.

“The Board concluded that actions taken by Mr. Rush were not consistent with the document retention directives issued by the Company,” the McLean firm said in a news release. A Sunrise Senior Living mansion. The company says its chief financial officer destroyed documents needed to resolve an inquiry of stock sales by insiders. “We believe that some records were destroyed,” Sunrise spokeswoman Lisa Mayr said in an interview.

For more on this story, see Washington Post Online.

Baker Hughes to Pay Record Penalty To Settle Kazakhstan Bribery Charges

On April 26, 2007, the SEC filed a settled enforcement action in the U.S. District Court for the Southern District of Texas, charging Baker Hughes Inc., with violations of the Foreign Corrupt Practices Act (“FCPA”). Baker Hughes agreed to pay more than $23 million in disgorgement and prejudgment interest for these violations and a civil penalty of $10 million. The charges stem from alleged violations of a 2001 SEC cease-and-desist Order, which prohibited violations of the books and records (and internal controls) provisions of the FCPA.

For more on this action, see SEC v. Baker Hughes.

As Fraud Case Unravels, Executive Is At Large

As Fraud Case Unravels, Executive Is At Large
By Jane Spencer and Kara Scannell

On a March afternoon in 2003, Henry C. Yuen, the former chief executive of Gemstar-TV Guide International Inc. sat alone in his Pasadena, Calif., office and installed a software program called Eraser 2003. According to his own testimony, he then deleted the contents of his hard drive, committing a crime with the potential to put him behind bars.

Mr. Yuen had reason to erase his tracks, federal regulators say. The Securities and Exchange Commission was zeroing in on Mr. Yuen as the primary player in a massive accounting fraud at Gemstar, the once highflying media and technology company he had …

For more see Wall Street Online Journal.

The President’s Identity Theft Task Force Releases Comprehensive Strategic Plan to Combat Identity Theft

Washington, D.C., April 23, 2007 — Attorney General Alberto R. Gonzales and Federal Trade Commission Chairman Deborah Platt Majoras today announced the completion of the President’s Identity Theft Task Force strategic plan to combat identity theft.

The strategic plan is the result of an unprecedented federal effort to formulate a comprehensive and fully coordinated plan to attack this widespread and destructive crime. The plan focuses on ways to improve the effectiveness of criminal prosecutions of identity theft; enhance data protection for sensitive consumer information maintained by the public sector, private sector, and consumers; provide more comprehensive and effective guidance for consumers and the business community; and improve recovery and assistance for consumers.

For more click this link.

Healthsouth Founder Settles SEC Fraud Action for $81 Million

The Securities and Exchange Commission announced on April 23, 2007, that the United States District Court for the Northern District of Alabama has entered a Final Judgment against defendant Richard M. Scrushy that permanently bars Scrushy from serving as an officer or director of a public company, permanently enjoins Scrushy from committing future violations of the antifraud and other provisions of the federal securities laws, and requires Scrushy to pay $81 million in disgorgement and civil penalties.

For more see SEC Litigation Release dated April 23, 2007.