White Collar Defense

Overview

As the government expands the scope of statutes like RICO, The Computer Fraud and Abuse Act, and The Money Laundering Control Act in its investigations and prosecutions, white collar defendants are increasingly subject to higher monetary penalties and added jail time. Clients at the top of their fields come to Ifrah Law because of our ability to successfully manage, navigate, and negotiate high profile federal investigations.

With a focus on government investigations, complex litigation, and white collar defense, Ifrah Law operates on the leading edge of matters involving the intersection of business and the internet. The firm represents companies and their senior executives in criminal and civil matters throughout the United States and also serves as a trusted business advisor to emerging industry clients doing business online.

Our attorneys include a former Chief of the Organized Crime Section at the Department of Justice and a former assistant U.S. Attorney, a former special assistant U.S. Attorney, and a number of highly trained veterans from some of the nation’s largest and most respected law firms. Our collective experience includes the litigation and resolution of disputes across a broad array of industries on issues ranging from cybersecurity and computer fraud to money laundering and asset forfeiture. As a result, we have established relationships and credibility with federal prosecutors and investigators in such agencies as the Justice Department, the FTC, SEC, and DOD, among others.

Founder Jeff Ifrah is a frequent speaker, author, and commentator on white collar crime issues and the co-author of the book “Federal Sentencing for Business Crimes,” the only complete treatise on the topic.  For six consecutive years Jeff Ifrah has been recognized by Chambers & Partners as a leader in the field of White Collar Crime & Government Investigations. Partner James (“Jim”) Trusty brings to the team 28 years of experience as a prosecutor in complex, multi-district white collar litigation, especially in matters involving RICO, computer fraud and money laundering:  for seven years he served in the DOJ’s Criminal Division, most recently as Chief of the agency’s Organized Crime Section.

 

 

   

 

Publications + Presentations
November 2016 | Presentation

Threat Investigations (USMS deputies)

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March 2012 | Publication

Best Offense Is a Good Defense

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October 13, 2010 | Publication

Commentary: Banned from the Internet

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April 28, 2008 | Publication

Sentencing Based on Loss

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Case Studies

Ifrah Law Achieves Swift Removal of Payment Processing Client from OFAC List in Highly Unusual Government Action

In September 2016, the U.S. Treasury Department Office of Foreign Assets Control (OFAC) announced it had designated Ifrah Law’s client, a legitimate international business, as a transnational criminal organization. Our client had conducted its business for decades without incident, providing payment processing solutions for direct mail, eCommerce, gaming, charitable, and other customers.

The OFAC designation of a legitimate business was the first of its kind, having been previously limited to terrorist and organized crime entities, such as the Yakuza, MS-13, and Saddam Hussein. The designation indicated that OFAC was expanding its authority under its legal mandate. Given the novelty of this designation, the company contacted Ifrah Law based on our background and extensive experience representing payment processors: understanding their business was critical to our ability to combat the Government’s misperceptions about the payment processing business.

First, we began an internal investigation. As the OFAC designation was a surprise to the company, and the Treasury Department had no obligation to explain the basis for the designation, we needed to determine why our client had been targeted.

We also needed to address the reverberating effects of the designation on our client. An OFAC designation results in the prohibition of U.S.-based businesses including banks from working with a designee. Our client lost the ability to pay employees, vendors, and general expenses and eventually was forced to close its operations.

Ifrah Law achieved some of the swiftest ever removals from OFAC’s SDN list, including all of the 12 individuals named. One year after the initial listing, OFAC finally signed an agreement to remove our client’s companies, officers and employees from the SDN List. We continue to represent this client in actions concerning the financial situation of the now defunct company, and to ameliorate the damage caused by the listing on both individual and corporate reputations. Our work on this case was featured in The American Lawyer.

Ifrah Secures Release for International Client Jailed for Alleged Arms Control Violations

When an international businessman was taken into custody at the U.S.-Canada border and jailed for four months without bail, the Ifrah team was brought in to challenge the government.

A businessman from a prominent political family in Pakistan was indicted for violations of the Arms Export Control Act (AECA) and the International Emergency Economic Powers Act (IEEPA), statutes traditionally used against professional exporters seeking to evade licensing requirements so the government does not detect their efforts to sell state secrets or military-grade weaponry to parties and governments with anti-U.S. sentiments.  He was also charged with making false statements about his intended use for legally purchased firearm accessories because he was not only an avid hunter but a licensed firearms retailer in his home country. Ifrah Law attorneys quickly filed a number of ground-breaking motions on our client’s behalf. One of the motions also sought bail for the client based on the weakness of the government’s case and notwithstanding the existence of an ICE detainer, a status which usually eliminates the possibility of release.

The Court expressed concern about the government’s ability to meet its burden of proof, and strong displeasure with the government’s case: “(T)he older I get,… the more distressed I am about the inability of government authorities to exercise common sense and practicality…. (W)e’re all in this together under one of the most sacred documents in our whole concept of jurisprudence, the Constitution of the United States, to treat people fairly and justly, not to win at any cost or put the screws to somebody so we can put the screws to them.”

After the defense investigation uncovered that U.S. law enforcement had destroyed physical evidence, the Court granted bail and ultimately the U.S. Attorney agreed to dismiss the IEEPA and AECA charges. Our client chose to plead guilty to the false statement charge and a sentence of time served in order to go home immediately. He had been in jail and away from his family for nine months, during which time he missed the birth of his first child.

Well-crafted motions and aggressive investigation led to the extremely rare circumstance of a foreign citizen charged with weapons violations being released from pretrial detention, and the ultimate dismissal of the more substantial felonies in the case.

(United States v. Durrani, No. 1:17-cr-00024 (W.D.N.Y))

Upholding the Fourth Amendment in the Digital Age

As Jae Shik Kim was departing the U.S. from Los Angeles International Airport, a Department of Homeland Security agent confiscated his personal laptop. Following the seizure, and a review of data it found on the laptop, the Department of Justice (DOJ) alleged that our client was involved in a conspiracy to evade U.S. trade restrictions on Iran. Our team acted quickly and strategically to clear Mr. Kim and uphold the Fourth Amendment, which prohibits unwarranted searches and seizures.

We filed a motion to suppress any supposed evidence gleaned from the laptop on the grounds that the seizure was illegal. The DOJ argued that a laptop was similar to any other container that could be searched at the border without a warrant. The judge rejected prosecutors’ arguments. As a result of our successful motion, the government was forced to abandon its case and we secured a victory against the DOJ. In this matter, it was shown that the government was searching for evidence of a crime committed years earlier and there was no suspicion of current illegal activity.

With the judge’s ruling, a strong statement has been sent to the government. This type of intrusion concerning our personal electronic devices without the proper documentation will not be tolerated. Further, the Fourth Amendment has been upheld, and the government has been warned against attempting to use its power at U.S. borders to circumvent basic rights.

(United States of America vs. Jae Shik Kim, Karham Eng. Corp., Crim. Action No. 13-0100)

Obtaining a Reversal of Conviction and Sentence Reduction for Securities Fraud

Ifrah Law represented a former Homestore.com executive, Stuart Wolff, who was indicted for securities fraud. During a six-year battle with the U.S. Attorney’s Office for the Central District of California, the trial and appellate teams worked together to secure a reversal of the client’s conviction and a new trial.

In the months leading up to the second trial, the defense team, which included Jeff Ifrah of Ifrah Law, leveraged irregularities with discovery to obtain dismissal of all charges related to PricewaterhouseCoopers, Homestore’s former accounting firm. As a result, the sentence on remand was reduced by 70 percent relative to the sentence imposed after the first trial.

Jeff Ifrah was the only attorney Mr. Wolff retained from the beginning of the case to its conclusion. Mr. Ifrah began managing the legal team after the first trial, continued through the appellate process, and also in the team’s preparation for trial on remand.

Jeff Ifrah was responsible for formulating and executing the strategy that resulted in the 70 percent reduction of Mr. Wolff’s sentence.

(U.S. v. Wolff, Case No. 2:05-cr-00398 (U.S. District Court, Central District of California))

Securing Dismissal of a False Claims Qui Tam Suit

Jeff Ifrah successfully represented global health care leader Merck in a False Claims Act qui tam suit and got the case dismissed.

The suit involved a whistleblower that worked for a health care buying company (a group purchasing organization that purchases supplies and drugs). Terminated from the buying group, the employee alleged she was retaliated against because of issues she raised about the buying process.

The case was brought before the U.S. District Court for the Northern District of Texas, and 18 drug companies were named as defendants in an alleged bribery scheme. Jeff represented Merck, which was one of the named defendants. He filed a successful motion to dismiss the complaint, based on the former employee’s alarming lack of specificity in her claim.

Not only was our motion to dismiss successful, it was efficient: Jeff won the dismissal roughly one year after Merck and the other defendants were originally served.

(United States ex rel. Fitzgerald v. Novation LLC, et al., S.D. Tex., No. 3:03-CV-01589))

Successfully Negotiating the Sale of Assets During a Government Investigation

When a company that is under investigation for money laundering decides to sell its assets, what was once a straightforward sales process becomes a complex negotiation. That is what happened with our client, a provider of diagnostic testing equipment.

Ifrah Law and Michelle Cohen represented the company in its sale of radiology and cardiology diagnostic services equipment, which involved numerous challenges. Understandably, the buyer was concerned about the ongoing criminal investigation, and Michelle worked closely with them to address their concerns about representations and warranties and possible post-sale seizure from the government. Additionally, since there were bank liens on some of the assets, Michelle worked with the bank’s outside counsel to arrange a prompt payoff, obtain a satisfactory pay-off letter and secure a release of the liens in order to close the deal. Michelle also worked with the buyer to create a creditor payment plan that would payoff unsecured creditors and obtain releases from them in order to address the buyer’s concerns about unsecured creditors seeking relief from the buyer. Finally, she created an employee fund (funded by the buyer) to pay for uncompensated leave time.

These complicated issues were resolved in less than two weeks, as a result of Michelle’s skilled negotiations with all parties. The buyer was represented by Delaware’s largest law firm.

Defending a Healthcare Provider Against Claims of Fraud

Our client, a prominent anesthesiologist, employed a medical services billing specialist to submit insurance claims for his practice and surgery center. The terms of the specialist’s contract stated that she would receive 18% of each claim she filed using a specific step-by-step submission and follow-up process.

After the billing specialist was terminated for not following the established submission procedures, she sued the doctor to retain her full commission on outstanding claims she had worked on prior to her dismissal, including those that hadn’t yet been paid. In addition to this contract dispute, she also accused our client and his surgery center of fraud, alleging that they funneled money into a “secret account” to avoid paying her commission under the contract.

Although there was very little basis for the fraud claim, the court allowed it to move forward.  Jeff understood the importance of attempting a settlement on the contract claim, so he analyzed the agreement and claims reports and devised a methodology for valuing the claim. When the plaintiff refused to settle, Jeff and the client pursued mediation with confidence, understanding both the fair value of the case and specific details of the parties’ contract. During mediation, the plaintiff’s side raised several arguments that demonstrated their lack of familiarity with the contract.  Jeff’s thorough understanding of certain provisions allowed the defendant to quickly address and dismiss the arguments.  As a result, the plaintiff ended up settling for much less than she originally claimed.

While the settlement terms are confidential, our client was thrilled with the final result, not only with the amount and the dismissal of the fraud claims, but also in terms of how well the matter was handled.

Blog Posts
October 15, 2015

Jumping To Judgment on For-Profit Education

Jumping To Judgment on For-Profit Education

  If you didn’t know any better, you might have gotten pretty fiery over for-profit education after reading one of the front page stories of Tuesday’s New York Times. The lengthy article titled “For-Profit Colleges Fail Standards, but Get Billions” is all about accusations of greedy institutions bilking taxpayers and taking advantage of students through… Read More

November 7, 2017

Deadline Fast Approaches for Final DMCA Registration

Deadline Fast Approaches for Final DMCA Registration

The Digital Millennium Copyright Act (DMCA) provides a safe harbor from copyright infringement liability for online service providers. While not a particularly famous law, it is a critical law because it enables websites to accommodate user-generated content without being concerned for copyright infringement claims by hosting that content. However, in order to preserve their safe… Read More

November 13, 2017

The Legal Fallout For Harvey Weinstein’s Hired Hands

The Legal Fallout For Harvey Weinstein’s Hired Hands

*This article was first published November 9, 2017 as an Expert Analysis – Opinion piece for Law360. The revelations surrounding the Harvey Weinstein cover-up are certainly cringeworthy, but are the actions of the mogul’s hired hands actually illegal? That Weinstein allegedly exploited and victimized women is terrible (even if far too common). The fact that so many… Read More

June 8, 2016

This Man Is Dodging Wall St.

This Man Is Dodging Wall St.

Rather than confront accusations of baseless zeal and prosecutorial overreach, New York federal prosecutor Preet Bharara would rather spend his energy dodging accountability. In 2010, Bharara launched a crusade against Wall Street, prosecuting several hedge funds he suspected of insider trading. Highly publicized raids followed. In the wake of the financial meltdown, Bharara was hailed… Read More