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When the U.S. Attorney’s office and the Securities and Exchange Commission recently announced a joint task force to target Internet fraud, a federal prosecutor was overheard cracking, “Boy, are we going to be giving the defense attorneys in town a lot of business. We’ll be paying for their kids’ college, the second wings on their houses, their vacations.” He wasn’t kidding. With a greater focus by prosecutors and regulators on corporate and executive misbehavior, particularly in the areas of health care, Internet and securities, environment and banking/money laundering, white-collar criminal defense — once an area the corporate firms refused to touch — is booming. “What’s going on now I call the explosion of white-collar practices,” says Marc Nurik, a partner at Ruden McClosky Smith Schuster & Russell in Fort Lauderdale. He is one of the original white-collar defenders in South Florida who has been doing this type of work for 10 years. “There was a completely different philosophy when I started. Big firms had an aversion to anything that had the word ‘criminal’ in it. It was the scarlet letter.” It used to be that if a corporation or executive was being investigated or charged with a crime, its usual law firm would refer the company to a criminal defense attorney. But that’s changed. Now, most corporate law firms in South Florida have at least one or two criminal defense attorneys on staff, if not an entire “white-collar group.” Ruden McClosky has one of the largest white-collar practices in South Florida, with six lawyers in Miami and Fort Lauderdale dedicated solely to the specialty. Ferrell Schultz Carter Zumpano & Fertel, a medium-sized Miami law firm, in the last year assembled a team of four lawyers for its brand-new white-collar group. And White & Case, the quintessential white-shoe firm, just added its second white-collar lawyer in Miami. South Florida firms say they started adding or beefing up the practice as state and federal regulators began cracking down on corporations, utilizing civil and criminal laws. Indeed, prosecutions are up at the U.S. Attorney’s office in South Florida, which in recent years has aggressively gone after polluting cruise lines, airlines that transport hazardous materials and guns and drugs, hospitals that defraud Medicare and Internet pump and dump-sters. The office had 41 prosecutors in 1980, 156 in 1990 and currently, 220. “There are some pretty sophisticated white-collar criminals in this area,” said first assistant Barry Sabin, noting that the agency is concentrating on Internet, securities and health care fraud these days and is casting a careful eye at Broward and Palm Beach counties. “This is the scam capital of the country.” All this is good news for defense lawyers. “There is more and more legislation passed and more and more criminal charges filed every year,” says Chuck Kline, managing partner in the Miami office of White & Case. Still, he added that the firm “picks its clients very carefully.” Kline says representing individuals accused of white-collar crimes can present a dilemma for his firm, which long has specialized in representing financial institutions. “We normally represent institutions rather than individuals,” says Kline. “The last thing we’d want to do is represent a bad element. What if the director of a bank and a bank officer were secretly defrauding the bank? If we represented them, we could wind up making law that would protect them and hurt banks.” Carl Schuster, managing partner at Ruden McClosky, says his firm started its white-collar practice three years ago when it hired Nurik. “We thought we’d try it,” he says. “We were amazed at how well that area of practice did. It has taken off.” Ferrell Schultz dove into white-collar defense just a year ago, hiring such stars as Bill Pearson, a former federal prosecutor and public defender in Miami with 90 trials under his belt. Bill Richey, a former Miami-Dade chief assistant state attorney under Janet Reno, and Joe Beeler, a veteran criminal defense attorney who serves as vice president of the American Board of Criminal Lawyers, also signed on. The firm entered the area in order to offer a full array of services to corporate clients and to complement its exploding health care practice, said managing partner Joseph Zumpano. “Health care regulation and enforcement is at an all-time high,” he said. “You’ve got both the feds and the state investigating health care fraud. Corporations wind up violating health care laws because they don’t have a real understanding of all the regulations. To be full-service on health care, you need someone who can identify the regulations. You need a white-collar advocate.” Is white-collar work lucrative? Not always, says Zumpano. Because a lawyer cannot withdraw in the middle of a criminal trial, Ferrell Schultz demands its fee up front, by carefully assessing the complexity of the case and whether it will go to trial. Due to the feds’ recent prosecution of lawyers for taking drug money from clients, Ferrell Schultz also turns down cases in which the fee would come from questionable or criminal means. “It’s not as lucrative as class action work, but because it is document-intensive, it can add up,” says Nurik. He noted that a case he once defended, in which members of a Venezuelan family were prosecuted in New York for allegedly stealing money from their bank, Banco Progresso Puerto Rico, generated one million documents. Money aside, white-collar defense attorneys say no other type of practice provides the intellectual challenge of criminal law. Many are former prosecutors or public defenders who did stints in civil law, but found themselves returning to the high-stakes criminal arena. Take Beeler, a newly hired partner at Ferrell Schultz. He got hooked on criminal law in the early 1970s when he ran an internship program for law students at the federal public defender’s office in Chicago. He honed his skills defending Native American protesters at Wounded Knee, S.D., in 1973. He and other outside attorneys came to defend the hundreds of protesters demonstrating against conditions on the reservation when local lawyers refused to represent them. Beeler spent a year in South Dakota, working pro bono, before a friend invited him to Miami to practice criminal law with him in 1974. He struck out on his own a few years later. Among some of Beeler’s recent high-profile defendants: � William “Tank” Black, the sports agent charged with swindling such clients as National Football League players Jevon Kearse and Fred Taylor as well as the National Basketball Association’s Vince Carter; and � Esperanza de Saad, who ran the Miami office of Banco Industrial de Venezuela and was charged with money laundering in the government’s Operation Casablanca. Beeler won an acquittal from a judge in that case. Working up to 22 hours a day on de Saad’s case for three years, Beeler could have used several more lawyers to help out. That’s when he decided he needed to work at a larger law firm. Last month, he chose Ferrell Schultz, bringing along his associate, H. Eugene Lindsey, and two paralegals. “When you go up against the United States of America, that’s a powerful opponent,” he says. “You’re up against 250 million people, really. You have to be maniacal.” Lindsey, a former civil litigator at Skadden Arps Slate Meagher & Flom in New York, used to spend his days setting up mergers and acquisitions. With criminal defense, “the work can be more difficult,” he says. “The sides aren’t necessarily equally balanced. But when you’re successful, the rewards are tremendous.” Nurik agrees. He spent the 1980s defending drug dealers and users, but then he got bored. “You could say there was entrapment, but that’s about it,” he says. “I lost interest.” So he started phasing out the narcotics cases and concentrating on white-collar. “What I love about it is every case is different,” he says. “One day I am representing doctors and have to learn all about the medical and pharmaceutical fields. The next day I’m handling a securities case and learning sophisticated strategies, the mortgage business and tax shelters. I become an instant expert. That’s the fun of it.” Lots of travel is one of the perks. And, white-collar crime is relatively recession-proof. “Crime keeps getting committed,” he says. “And every year legislators pass new laws. Eventually someone will get around to enforcing them.” Greg Baldwin practices white-collar defense at Holland & Knight in Miami, along with handling commercial and securities fraud matters. Like Nurik, Baldwin, a former prosecutor with the Justice Department’s organized crime and racketeering strike force, the Philadelphia district attorney’s office and the U.S. Attorney’s office in Miami, finds criminal defense work fascinating. “The fun part is you try and climb into the mind of the government,” he says. “When you pick up a document, there are two ways of looking at it. My job is to figure out the way the government is looking at it.” Baldwin utilized this philosophy when defending a Greek company accused of an oil spill off San Francisco. The Command, which had been docked in San Francisco Bay for fuel tank repairs, left for Ecuador in September 1998. Despite Coast Guard orders not to use a damaged tank, the captain ordered fuel transferred to that tank at sea; that’s when the oil spill occurred. He then failed to notify the Coast Guard as required by law. At least 170 birds, including rare brown pelicans, were killed; cleanup costs were estimated at $1.23 million. The captain, the first engineer and the operating company were initially charged with deliberately dumping the oil, a felony, but Baldwin helped them get a deal which kept all three out of jail. He also represented the Miami branch of the notorious Bank of Credit and Commerce International (BCCI). Now defunct, the bank was shut down by regulators after federal investigators determined it served as a laundering operation for drug and arms smugglers. Among the bank’s depositors: deposed Panamanian dictator Manuel Noriega. The practice of white-collar defense has changed over the years, becoming increasingly more proactive. Now, instead of waiting for a subpoena to be served, lawyers are teaching their corporate clients how to avoid being investigated in the first place, or at least how to prepare for the day they do receive a subpoena. “We’d like to educate our health care professionals, banks and other clients on how to stay out of trouble,” says Beeler. “A good business will have a compliance program. That way, when an employee makes a stupid mistake, you could show the government that the company has a compliance program. It carries a lot of weight.” Reflecting their new, proactive approach, Ruden McClosky is in the process of changing the name of its group from the White-Collar Criminal Group to the White-Collar Group. The law firm is putting together a seminar called “What to Do When the Government Comes Calling.” It will serve as a primer for other lawyers, in-house counsel and clients on how to deal with subpoenas and search warrants and to do self-policing. “That’s a very important part of white-collar practice these days, taking prophylactic measures,” says Nurik.

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