New York Judge unseals guilty pleas in Dewey law firm fraud

Fri Mar 28, 2014 5:18pm EDT
 
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By Karen Freifeld

NEW YORK (Reuters) - A New York judge on Friday unsealed the records of six former Dewey & LeBoeuf employees who pleaded guilty in connection with accounting fraud at the law firm.

The records offer a new peek into the government's case against top executives at the defunct elite international law firm and how key witnesses might testify against them.

The employees, who range from Dewey's controller to its billing director, agreed to cooperate with prosecutors who have targeted the firm's top management.

Dewey's former chairman Steven Davis, 60, executive director Stephen DiCarmine, 57, and chief financial officer Joel Sanders, 55, were charged March 6 with taking part in a scheme to cheat banks and investors as they struggled unsuccessfully to keep the law firm alive.

Dewey & LeBoeuf collapsed in 2012, becoming the largest U.S. law firm to file for bankruptcy. If convicted of the top counts against them, the executives each face up to 25 years behind bars.

Prosecutors have accused the executives of using accounting fraud so that Dewey & LeBoeuf could get and keep more than $200 million in financing.

The firm's lenders included JPMorgan Chase & Co, Citigroup Inc's private banking unit, Bank of America Corp and HSBC Holdings Plc. Dewey & LeBoeuf also had a $150 million bond offering in 2010.

The court records offer detailed admissions of wrongdoing but hazy accounts of the direct evidence prosecutors have against the executive trio and Zachary Warren, 29, a lower level employee also charged in the case.   Continued...

 
A sign is seen at the offices of Dewey & LeBoeuf in Palo Alto, California June 5, 2012. REUTERS/Robert Galbraith