As discussed in a prior post, the Department of Justice has formed a nationwide task force comprised of AUSAs from each of the 93 U.S. Attorneys’ Offices, as well as Main Justice. Together they total more than 100 federal prosecutors, to investigate and prosecute fraud related to the ongoing pandemic. The District of New Jersey U.S. Attorney Craig Carpenito spearheads this effort.
If you are a small business that was lucky enough to find a bank willing to accept and fund your small business Paycheck Protection Program (PPP) application, then a small portion of the $670 billion program went to an intended beneficiary. Unfortunately, many small businesses quickly learned larger banks were unwillingly to process their applications. News reports revealed banks received $10 billion in fees for the first traunch of funds dispersed, for which they received a set processing fee of 1-5% based on the size of the loan. A lawsuit filed in the U.S. District Court for the Central District of California against several major banks alleges they moved larger borrowers to the front of the line, ahead of many deserving smaller businesses in order to maximize on origination fees. Some corporations received tens of millions of dollars from the federal small business lending program, which initially ran out of money on April 16. Although the program has been funded once more, applicants are under much greater scrutiny.
One of the largest issues hampering the re-opening of the American economy is that there are many asymptomatic yet contagious carriers of COVID-19. Rational leaders, medical experts, and scientists agree that widespread testing is essential to prevent further hotspots and determine which areas of the country may start to open again. Tests to determine whether a person is currently infected, as well as antibody tests to determine whether a person has been exposed and may have some immunity to the virus, will soon be widely available from many new sources. Companies cannot make informed decisions about when and how to re-open without knowing if their employees are healthy. State and local governments cannot determine how to move forward without this critical information. The federal government has assisted testing companies and labs by removing some of the FDA safeguards and time periods normally in place to ensure quality standards and safety.
The Department of Justice (DOJ) and various state agencies have announced that they will aggressively pursue fraudulent schemes related to COVID-19. On March 16, Attorney General William Barr directed all U.S. Attorney’s Offices to prioritize the detection, investigation, and prosecution of all criminal conduct related to the Coronavirus pandemic. Each office was directed to appoint a COVID-19 fraud coordinator to serve as the liaison between the local Department of Justice and their state and local counterparts.
Many federal, state, and municipal courts have limited the number and types of cases they will be handling in the near term. Some have adjourned jury trials for several weeks and in some cases even months to see what happens after a period of isolation. Courts have summarily waived Speedy Trial Act rights and ordered continuances for a period of time. State courts in particular are promoting the use of video and teleconferencing in lieu of appearing in court. Municipal courts have adjourned court appearances for motor vehicle summonses and code violations. Detention has been waived in certain cases depending on the type of crime, the age of the offender, and other relevant factors.
Despite the United States Supreme Court decision in Carpenter v. United States requiring law enforcement to obtain a court authorized warrant for historic and current cellphone location data, four main cellphone carriers have continued to sell real-time location data to a host of entities, including federal law enforcement agencies. The Federal Communications Commission (FCC) is proposing fines of up to $200 million against these carriers for the violations.
When a person is a target of a federal or state criminal investigation, they are often contacted − either directly if unrepresented or through counsel if represented − to attend either a proffer or a reverse proffer with the U.S. Attorney’s Office, State Attorney General’s Office, or County Prosecutor’s Office.
In many states, prosecutors and defense attorneys have the ability to sentence bargain, meaning that in addition to determining what charges the client agrees to plead to, they also agree to a specific sentence that the court must then accept or reject. In the very few cases where the court rejects the sentencing recommendation, the client is afforded the opportunity to withdraw the guilty plea or accept the sentence as determined by the court. The federal system is much different.
In the federal system, most people charged with non-violent offenses are released on conditions after their first appearance before a magistrate judge. Conditions of release are meant to reasonably assure the appearance of the defendant in court as required, as well as the safety of any other person or the community pursuant to 18 U.S.C. §3142(c). Conditions may be as simple as release on an unsecured appearance bond (meaning no property or money is posted); travel restricted to the continental United States; surrender of one’s passport; surrender of any firearms; and telephonic or in-person reporting to Pretrial Services. In certain serious cases, conditions of release could be very stringent, requiring home detention with electronic monitoring where the person is only allowed out of the home for pre-approved visits with their attorney or medical appointments; surrender of family members’ passports; the posting of real properties with substantial equity; and release of the defendant to third party custodians who are required to report any violations of the release conditions to the court.
The world is now a much smaller and more surveilled place. Private companies that make our smart phones, home security systems, smart home systems, baby monitors, computers, E-Z Pass, real time traffic apps and many more internet-of-things devices track, record and store information about our personal lives. Law enforcement has access to much of this information, often without the need for a warrant. Furthermore, law enforcement has its own methods to track and record private citizens through wiretaps, license plate readers, surveillance cameras, mobile tracking devices, hidden recorders and many other devices and methods.