Bressler Risk Blog

This month’s sponsor thank you to our supporter Accuity features an interview with Mike Guernon, Global Director of Intake, Risk & Compliance at Orrick, Herrington & Sutcliffe LLP.

Listen to him explore: “How COVID-19 will Affect Risk Functions in Law Firms” —

• “We’ve got a large global footprint so we’re always dealing with a number of compliance issues that arise out of new legislation, new laws, new rules, new opinions. And my role has been and throughout my career is just to identify ways to improve the workflow and find the right tools. Whether it’s resources or technology that really take the sting out of the bureaucratic delays that can come with some of the compliance issues. Our focus has always been making it very efficient, making it painless and really raising the overall amount of compliance that we get… our forucs is really to be proactive about these risk issues.”
• “…everyone had to take drastic steps. We found ourselves in an unique position in that we had to be responsive to all of our clients’ needs. They had many questions, whether it was the state by state policies or some of the federal policies as they as they came about. And there was a concern to really be super responsive to what new markets and new demands were arising. At the same time, in our experience on the risk mitigation side, we were well familiar with similar events like the 2008 recession where you had similar reactions from the markets and from clients. And this very, very vocal need to get things done quickly. But our takeaways and I think risk management throughout law firm and legal.”
• “A key takeaways from 2008 was the amount of claims that would exponentially rise like 12 to 16 months after an event like that are alarming because people are anxious to get to the work. Sometimes in an attempt to do that, some of the risk protocols can sort of be overlooked. So our focus right from the jump was to be very, very responsive to our attorney needs, while at the same time making sure we were missing any of the critical steps from the basic to run the conflicts analysis within our database to make sure we didn’t have an ethical issue.”
• Listen to the complete podcast here.

See Also: Past Interviews from Accuity (in PDF form):

• Exploring issues including: strategies for making the case to invest in risk management, training and developing conflicts staff and navigating Outside Counsel Guidelines: “In Discussion with A Law Firm Risk Expert“
• Discussing topics including: current conflicts trends, the pressures facing conflicts teams, the opportunity for innovation in staffing model and technology: “In Discussion with A Law Firm Conflicts Expert”

“Reality of law firms’ approach to AML not living up to their policies” —

• “There is a difference between many law firms’ anti-money laundering (AML) policies and procedures, and what actually happens in practice, the Solicitors Regulation Authority (SRA) has found.”
• “It also revealed that nearly two-thirds of the firms it reviewed in the first year of a new programme of AML checks needed ‘some form of engagement’ with the regulator as a result.”
• “The regulator said, in a report published this week, that these failings included ‘a lack of an effective compliance framework, or indeed a lack of any AML policies, controls, and procedures at all.'”
• “In other cases, at least half the files reviewed had “serious issues” such as a lack of due diligence, or the firm had a money laundering compliance officer who ‘did not appear to understand their obligations and was failing to carry out their role properly.'”
• “The SRA said that a large number of files showed differences between the firm’s policies and procedures and ‘what actually happened on the ground.’ However, the regulator said the law firms were ‘for the most part, united in their determination to keep the proceeds of crime out of their client accounts, and we were able to assist many of them in meeting their obligations.”
• “Speaking at the SRA’s virtual COLP and COFA conference yesterday, Zoe Allen-Robinson, its AML proactive supervision manager, said the majority of law firms ‘took their obligations seriously.'”
• “Suzie Ogilvie, global head of financial crime and sanctions at top City firm Freshfields Bruckhaus Deringer, said the pandemic had created ‘a number of challenges’ in terms of AML, such as a rise in impersonation frauds because lawyers were not meeting people face-to-face.”

“NJ Judge Disciplined for Refusing to Step Down From Her Landlord’s Cases” —

• “Lilia Munoz, a municipal court judge in Union City and Guttenberg, has been reprimanded by the state Supreme Court for a long-running and undisclosed conflict of interest.”
• “Munoz violated the canons of judicial conduct by presiding over multiple cases in which parties were represented by Ramon Gonzalez, an attorney who rented office space to her, the court said in an order made public on Monday.”
• “Gonzalez, who has his own law office in the same building, received rent payments from Munoz from 2008 to 2018 for a law office in a building in Union City that he and his spouse owned. And during that time, Gonzalez appeared before Munoz as counsel of record numerous times, in both Union City and Guttenberg, according to the Advisory Committee on Judicial Conduct complaint.”
• “Munoz, through her defense attorney, Robert Feder, admitted to the allegations in the complaint and that those facts constituted violations of the Code of Judicial Conduct, according to a stipulation issued by the committee.”
• “The court also found Munoz violated an ethics rule requiring judges to disqualify themselves in proceedings where any factor might preclude a fair and unbiased hearing and judgment, or which might reasonably lead attorneys or parties to believe so.”
• “Among the various levels of discipline imposed on judges who commit ethical violations, a reprimand is more serious than an admonition, but less so than a censure, although each has a similar practical impact on the life of the judge.”

“Greenberg Traurig Clears Conflict Inquiry In $1B Fraud Case” —

• “A Tennessee federal judge on Friday found that potential conflicts of interest do exist between several attorneys representing a pharmacy owner and pharmacies accused of a $1 billion insurance scheme, but waived the conflicts pertaining to a pair of Greenberg Traurig LLP lawyers.”
• “In the suit, the government alleges that pharmacy owner Larry Smith, seven pharmacies and several other individuals conspired to deceive tens of thousands of patients and more than 100 doctors across the country in an elaborate scheme that attempted to bilk private health care insurers out of $931 million.”
• “Prosecutors raised concerns about possible conflicts of interest in the case in March, asking the court to further probe the matter. Specifically, they said Greenberg Traurig shareholder Gregory Kehoe, who represents Smith and two associated companies, previously represented a pair of potential witnesses in the case when they were deposed in a related civil suit in Florida.”
• “U.S. District Judge J. Ronnie Greer on Friday granted the government’s motion for judicial inquiry into possible conflicts of interest but found that the potential conflicts involving Kehoe and fellow Greenberg Traurig shareholder Danielle Kemp were waivable.”
• “‘Kehoe and Kemp properly obtained waivers from Smith and the two potential witnesses,’ the judge said. ‘The court has hereby accepted the waivers… [T]he content of the waivers reasonably ensure Smith made an informed decision to accept their continued representation'”
• “Specifically, the waivers Kehoe and Kemp obtained contained explanations and disclosures that adequately informed their client and former clients of the material advantages and disadvantages of the proposed course of action, according to the order.”

“Ex-NRA Execs Fear Attorney Is Shielding LaPierre at the Group’s Expense” —

• “In early 2018, the National Rifle Association, alarmed by growing scrutiny from oversight agencies in New York State, hired attorney William A. Brewer III and his firm to fend off the threat. Rather than compromise, Brewer attacked. Today, the NRA — once considered the most powerful interest group in American politics — faces the prospect of extinction.”
• “Some NRA members and a handful of the gun group’s former leaders have long charged that Brewer has imperiled the organization by prioritizing the interests of chief executive Wayne LaPierre. Only recently has LaPierre gotten his own attorney in cases that involved both the NRA boss and the organization. LaPierre’s new attorney and Brewer share history: Both have worked for a development group behind a proposed ice skating complex in the Bronx that has been described as the largest in the world.”
• “In Brewer’s first year of service, the NRA paid his firm $19 million, or roughly $1.6 million a month, according to court filings and internal correspondence. If that monthly average has held, the firm has collected upward of $50 million to date — a conservative estimate given how the firm’s NRA workload has grown.’
• “In 2018, the NRA’s audit committee, at Brewer’s direction, started to retroactively approve financial transactions that had benefited insiders. Committee chairman Charles Cotton has defended the approvals, telling The Wall Street Journal that the committee had ‘confirmed that the services were rendered at fair market value and worked in the best interests of the Association.’ According to James’s complaint, however, the committee did not review any relevant records, such as contracts, so it failed to meet a state requirement that nonprofits approve only insider transactions that are determined to be ‘fair, reasonable and in the corporation’s best interest.'”
• “Arulanandam [NRA Public Affairs Director] said the firm has ‘helped the NRA prevail in a wide range of matters’ and pointed to the legal bills dispute, a recent settlement with a New York regulator, and a lawsuit that the NRA filed in 2019 against the city of San Francisco. (The NRA withdrew the San Francisco suit, which was not handled by Brewer’s firm.) ‘We are proud of the firm’s track record for the NRA,” Arulanandam said. “The firm’s scorecard is phenomenal.'”