The Ethical Barometer

He was a lawyer’s lawyer.  The Tom Wolfe of the legal profession with his sartorial splendor.  He was the good guy in the story of Jeffrey Wigand’s battle with the tobacco companies (“The Insider”).  Mr. Scruggs recovered $206 billion in his class-action suit against the tobacco companies.  His fee was $1 billion for that case brought for 46 states.  But, the judge presiding over Mr. Scruggs’s 2007 class-action against an insurance company for Hurricane Katrina damages contacted the FBI about a bribery attempt. There are two theories on how the indictment was able to include exact language of conversations between the judge and others.  One is that the judge and/or his office were wired.  This theory makes more sense because the judge reported the attempt, and other conversations could have been obtained by taps.  Still another theory is that one of the four others Scruggs was working with to bribe the good judge cut a deal with the FBI and agreed to wear a wire. Never trust the people you cheat with.  They will throw you under the bus. Continue reading →

The former paramour of actress Anne Hathaway, Italian entrepreneur, Raffaello Follieri, has been charged with using investors’ money for financing a lavish lifestyle, as well as the ubiquitous white-collar charges of money laundering, wire fraud, and conspiracy. However, this case does have its charm. Mr. Follieri is alleged to have told investors that he was the former CFO of the Vatican.  Wisely, the Vatican has no such position.  The complaint also alleges that Mr. Follieri kept ceremonial robes to clothe monsignors he had hired in Vatican-like robes to impress investors.  The devil wears Prada?????

The Illinois attorney general has filed suit against Countrywide Financial, one of the country’s largest subprime lenders, and its CEO, Angelo R. Mozilo.  The suit, announced by AG Lisa Madigan, alleges that in its effort to dominate the subprime lending market,  “Countrywide created risky and costly loan products and marketed them to borrowers who could not afford them,” and  “Countrywide repeatedly qualified borrowers for mortgage loans based on salaries that were significantly higher than what they really made.”  The suit seeks restitution for those who lost their homes through foreclosure on allegedly unfair mortgage loans.Read the complaint:  www.illinoisattorneygeneral.gov.