By David Arthur Walters
Miami Beach – CityDebate.Com – November 1, 2009 - What we are now calling The Great Recession is teaching us the usual lessons, one being that we cannot  trust the highly paid professions to regulate themselves on our behalf according to their professed ethical codes. Status and money are joined at the hip in our culture; many people believe that greed is good and might right, so even the most
corrupt professions may be highly esteemed. One highly paid and esteemed profession is that of law, which likes to generally consider itself as a sort of fiduciary for the people, a trustee of the principles of justice that freedom holds dear, although we find lawyers involved in or at least overlooking almost every great
deception of their ultimate beneficiary, the people at large. Wherever their organic combination has enhanced their power, say, by the narcissistic submerging of individual lawyers under the auspices or ‘divine blessing’ of powerful law firms, the greater have been the frauds perpetrated. For recent example, take the Stanford
Fraud and the involvement therein of lawyers associated with Greenberg Traurig, the most powerful or politically connected Florida law firm – mind you that the Firm takes action to curb misconduct after it is detected and exposed.
According to various 1999-2000 media reports, Allen Stanford’s friend Lester Bird, Prime Minister of Antigua, in response to U.S. pressure, asked him for help in reforming Antigua’s banking laws. Mr. Stanford recruited former customs agent Patrick O’Brien, a
Greenberg Traurig lawyer, to help re-write the country’s banking laws. Prime Minister Bird, at Mr. Allen’s urging, appointed two other Greenberg Traurig lawyers as advisors, one being Carlos Loumiet. Mr. Loumiet’s good friend at Greenberg Traurig, Yolanda Suarez, had become Mr. Stanford’s chief of staff. It was also reported that
Mr. Stanford recruited former officials with the Drug Enforcement Agency and the Federal Bureau of Investigation as advisors to help with the revision of Antigua’s law.
Greenberg Traurig’s Mr. O’Brien was so pleased with the legal team’s handiwork on behalf of Mr. Stanford’s Antiguan counterparts that he reportedly said that he had no doubt that the result was the “best anti-laundering laws in the world.” U.S. Treasury Department
officials, outraged at the American lawyers’ weakening of Antigua’s laws, did not see it that way, and issued an advisory warning urging careful scrutiny of financial transactions involving Antigua. The British government did the same a few days later.
At Mr. Stanford’s behest, Antigua chose Greenberg Traurig’s Mr. O’Brien to lead an Antiguan delegation to Washington to meet with the head of the State Department’s Bureau for International Narcotics and Law Enforcement Affairs, assistant secretary of state and
attorney Jonathan Winer. His office subsequently issued a report damning Antigua as the most attractive money-laundering situs in the Caribbean. The State Department’s damnation was even more explicit about the financial influence used to pervert Antigua’s money laundering legislation. Charles Iatrago, the publisher of Miami’s
Money Laundering Alert, said at the time that officials were going out of their way to highlight Mr. Stanford’s influence in Antigua – Mr. Iatrago has more recently identified Miami, aka the Magic City, as the most corrupt city in the United States.
Apparently the State of Texas was unwilling to have the U.S. swinging door of the Stanford laundromat set up within its borders. In 1998 Greenberg Traurig lawyers, apparently led by Carlos Loumiet, were collaborating with State of Florida banking regulators to set up a
unique, unregulated foreign trust in Miami, which would be, in effect, a laundry facility that would receive funds from unwitting investors and from only God knows whom else, ship the money in bags to Antigua, and shred the related documents with state regulators standing by, hogtied by the antinomian agreement with Florida.
Mr. Loumiet, by the way, was accused of playing a conflict-of-interest and cover-up role in the Hamilton Bank fraud when he helped Greenberg Traurig audit the banks records and allegedly overlooked evidence of purportedly illegal swaps, a device that purportedly
turned losses into profits upon which certain bank officers, subsequently jailed, took bonuses. The prosecutor dredged up a smoking gun from the ruins, a faxed document showing a Russia-China swap, which he claimed that Mr. Loumiet had separated to conceal the swap, then destroyed the fax cover letter. Mr. Loumiet claimed that the
bank examiners themselves had seen what he saw, that it was perfectly clear that the swap was described in the same fax, and they had also overlooked the evidence. Furthermore, he was only one member of the Greenberg Traurig auditing team. Besides, the particular transactions referred to had actually done no harm to the bank’s
stakeholders. The case against him was dismissed by Comptroller or the Currency John C. Dugan in August 2009 because he found insufficient evidence that Mr. Loumiet’s acts harmed the bank, one of three elements necessary to subject him to sanctions. After examining Mr. Loumiet’s side of the story, we may be left with the definite
impression that the Office of the Comptroller was gunning for Mr. Loumiet in order to get him for anything that it possibly could fit him with. On the other hand, Mr. Dugan’s discussion seems to indicate that Mr. Loumiet was probably guilty of misconduct, and he faulted Administrative Law Judge Ann Z. Cook, who had tried the case
below and found that Loumiet "did not knowingly or recklessly participate in misconduct that caused or was likely to cause more than minimal financial loss,” for excluding expert witness testimony that would have supported a finding of culpability.
Now Jonathan Winer has been quoted in an August 9, 2009 Miami Herald report as saying that the breakdown in the Stanford affair actually occurred when the 1998 deal with Florida was struck. On July 19, 2009, the Herald reported that the “legal justification”
for the special arrangement with Mr. Stanford was provided by the State of Florida’s senior banking analyst, David Burgess, a non-lawyer, who reasoned, “The definition of a trust company can be stretched.” His casuistic stretching of Torah into Mishna was apparently conducted under the supervision of attorney Art Simon, the state
banking director who approved of the peculiar scheme over the objections of his own counsel. Several Florida attorneys believed the scheme was contrary to banking laws and probably fraudulent. Mr. Stanford had shopped around for attorneys to do the deal before he wound up with Greenberg Traurig, and one who refused and became
vocal about his refusal was Bowman Brown. Mr. Brown was recently asked by this writer to file a complaint with The Florida Bar, and I asked another politically connected attorney, Anthony S. Battaglia, an expert in banking fraud, to do the same.
The citizens of Antigua were exceeding embarrassed when the scandal broke, and called for the resignation or sacking of any Antiguan officials involved. Allen Stanford’s blood brother Leroy King, the former Bank of America official who became
Antigua’s chief regulator, was sacked, detained, and arrested – we do not know whether he has broken the vow of silence made to Mr. Stanford when he exchanged blood with him in what has been termed a “bizarre ritual” by reporters, although many red-blooded American men did not think the exchanging of blood under oath was “bizarre”
when they were boys.
The blow to Antigua’s economy as a result of the scandal has been devastating. Hugo Chavez of Venezuela has come to the rescue with multimillion-dollar largess. But the public officials on the State of Florida end of the laundry scheme are apparently still in
place, and there is some speculation, on the part of conspiracy theorists who believe the Bush Family patronizes evil in Florida, that the most likely suspects, including the influential Greenberg Traurig law firm, are being protected by Governor Bush’s successor Governor Crist, his attorney general, and, as far as attorneys go,
by the Florida Supreme Court’s disciplinary arm, The Florida Bar.
We prefer to believe that the conspiracy theorists are mistaken about the Supreme Court of Florida and its disciplinary organ – The Florida Bar is an agency of the Supreme Court. Bar and Bench are united in Florida by virtue of what is called an integrated or
mandatory bar that every Florida lawyer must belong to if he would practice law. Several state supreme courts, recognizing the inherent power of the independent judiciary to regulate the practice of law of “officers of the court” free of interference from the legislative and executive departments of government, integrated the
profession into self-governing corporatist organs to upgrade and protect the professional order’s integrity in response to public outrage over both real and imagined misconduct of lawyers.
Our “natural” rights would not be worth a whit without lawyers. We prefer not to say that all lawyers are crooks, but to say that in the end they are not any better than the
Continued on pg 2 |
