Preet Bharara has offered an explanation for why more banks were not prosecuted in the aftermath of the mortgage meltdown : Shady lawyers.
At a breakfast sponsored by Crain’s New York, the US Attorney compared banks to the mob, explaining that the executives at the ‘top of the food chain’ often had plausible deniability that their actions could be criminal – in part because they had law firms that okayed the transactions.
As a PI who works closely with lawyers, I thought about how our professions are often put in the difficult position of having to uphold the law and maintain ethics, while at the same time getting the best possible result for clients – often rich and powerful ones – who are footing the bill.
Crain’s writer Aaron Elstein pointed out that, although Bhararawas speaking generally, his explanation paralleled the situation at Lehman Brothers. The firm spent $1.1 billion on ‘professional fees’. A substantial amount of that money went to Linklaters, the UK firm that finally agreed to sign off on the company’s complex financial transactions – after several US firms refused.
One moderator at the breakfast said that legal opinions were “bought and paid for” by banks.
Bharara explained: “There are lawyers who are prepared to be the firm that blesses something that they know may be fishy. And they know that the first firm wouldn’t bless it, the second firm wouldn’t bless it, the third firm wouldn’t bless it, the fourth firm wouldn’t bless it, and maybe the fifth firm located abroad somewhere will bless it. It’s a leap from that to proving beyond a reasonable doubt to a unanimous jury in America that someone knew they were committing a crime when they had the benefit of that opinion.”
I have had requests to do all kinds of illegal things – from wiretapping phones to hacking into bank accounts – and refused. I know that clients can be so desperate for results that they may pass me by in order to find an investigator who will.
But a shady shortcut is unethical, criminal, and never the answer. Clients need to trust that you will tell them the truth – even if it’s something that they may not want to hear – in a difficult situation. And I would NEVER want to be sitting in front of a judge and have something I did compromise a case – not to mention my reputation.