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Breuer Bids Good-Bye to Justice
As one of the longest-serving leaders of the U.S. Department of Justice's criminal division, Lanny Breuer has overseen some of the highest-profile cases in the country's history. On March 1, after nearly four years at the helm, Breuer left his post. Talk of Breuer's departure from one of Justice's most coveted slots had been ongoing in Washington legal circles for months.
"I will miss my colleagues. There's no job like it," says Breuer, a former Covington & Burling white-collar defense partner in Washington. "I'm sure I will love the private practice againor whatever it is in the private sector. But this is as great a job as you get."
Attorney General Eric Holder Jr. said in a statement that Breuer has led one of the "most successful and aggressive" criminal divisions in the department's history. Holder touted the nationwide fight against financial and health care fraud, among other areas, as highlights of Breuer's leadership since early 2009.
"Throughout his tenure, Lanny has demonstrated an unwavering commitment to the mission of this department, and I want to thank him for his dedication and exceptional service," Holder said in the statement.
Under Breuer, the department secured a record-setting $4 billion in fines and penalties from BP plc for its role in the Gulf of Mexico oil disastera deal a judge in New Orleans approved. Enforcement of antiforeign bribery laws surged. Major banks turned over billions of dollars to the government through deferred prosecution agreements over violations of antimoney laundering provisions. In one recent case, in December, HSBC Holdings plc agreed to a record $1.25 billion forfeiture agreement with the Justice Department.
But HSBC and other banks weren't indicted, Breuer's critics have charged, creating the impression that the criminal division has given a pass to large financial institutions for flagrant criminal violations. On the financial fraud front, the PBS program Frontline recently questioned the lack of charges against top Wall Street executives for their roles in the financial crisis.
And Republican leaders on Capitol Hill have accused Breuer of leadership shortcomings amid the tumult over Operation Fast and Furious, the flawed gun trafficking sting along the southwest border. Representative Darrell Issa (R-California), chairman of the House Committee on Oversight and Government Reform, said this winter that Breuer's resignation is "long overdue."
"I think Washington can be a divisive town," Breuer says. "I recognize that in a job like this you're going to receive praise, and you're going to receive criticism. Sometimes you may get praise that you don't deserve. Sometimes you may get criticism you don't deserve."
The dispute over Fast and Furious will continue after Breuer leaves. Issa's committee sued the Justice Department in Washington's federal trial court in August to try to squeeze information from the department; the suit seeks the enforcement of a congressional subpoena. A judge scheduled a hearing for this month in Washington.
Breuer insists that the criminal division has been aggressive in the fight against financial fraud. He heralded the successful trial prosecutions of R. Allen Stanford and Lee Farkas as examples of big-name defendants going to prison.
Stanford was sentenced last June to 110 years in prison for his role in one of the country's largest investment fraud schemesone in which $7 billion was bilked. A federal trial judge in Alexandria, Virginia, in June 2011 sentenced Farkas, the former chairman and owner of Taylor, Bean & Whitaker, to a 30-year prison term for a multibillion-dollar fraud scheme that contributed to the collapse of Colonial Bank.
In the face of criticism over the lack of cases brought against Wall Street executives, Breuer has argued that prosecutors have a duty not to bring cases that can't be proved beyond a reasonable doubt. That's the argument he's made publicly. He repeated on the Frontline piece titled "The Untouchables."
"These are hard cases," Breuer told Corporate Counsel sibling publication The National Law Journal . "Never oncenot once in four yearshave prosecutors come to me endorsing an indictment in one of those cases and I would have said no. Obviously, those cases have proven to be difficult."
On the global front, Breuer trumpeted the ongoing pursuit of big banks over allegations concerning the manipulation of the London Interbank Offered Rate, or Libor. Criminal deals with two financial institutionsBarclays Bank plc and UBS AGincluded $660 million in penalties.
Enforcement of the Foreign Corrupt Practices Act, the antibribery law that dates back to 1977, reached new levels in recent years as prosecutors ramped up cases against individuals and secured some of the largest-ever deals with corporations. In November, Breuer was a cosigner, with SEC enforcement director Robert Khuzami, of a much-anticipated guidebook addressing the scope of FCPA enforcement. (The SEC announced earlier this month that Khuzami is leaving the agency.)
"I really feel that in the area of corruption, we have changed the dialogue in a substantial way," Breuer says. "It's been our division at the forefront of that. I'm very proud of that." He adds: "By any measure the enforcement of the FCPA and our effort in fighting corruption domestically and internationally has been pretty extraordinary."
Breuer says he's staying in Wash ington after leaving Justice. A couple of former colleagues at Covington have expressed their interest in seeing him return to the firm.
"That's better than the reverse," Breuer says, laughing. "They have told me of their love. I really haven't yet talked to anyone in any serious way." (Covington declined to comment about Breuer.)
A version of this story originally appeared in The National Law Journal.