A decision of that Supreme Court throw out fraudulent allegations of two political aides to former New Jersey Governor Chris Christie is making headlines through other white-collar cases, which could spur appeals by other defendants, who say prosecutors The federal government has become too aggressive in using anti-fraud laws to investigate dishonest behavior.
In a New Jersey scandal called Bridgegate, last year a high court ruled that a political sanctions scheme involving paralyzing a town for traffic congestion was not fraud. federal. This decision prompted the reimbursement of most of the internal fees a case of high-end insider trading, and may prejudice prosecutors’ efforts to uphold convictions in a disclosure case. ethical failures in one of the Big Four accounting firms.
The problem in both cases is when poor conduct can be considered criminal fraud. The Supreme Court asserted in the New Jersey case that federal fraud allegations apply only when a plan seeks to take money or property through fraudulent means.
In the insider trading case, Manhattan federal prosecutors said on April 2 that because of the New Jersey case, most of the charges should be dropped. They suggested to the US Court of Appeals for Round Two that the entire case against Christopher Worrall, one of the defendants, was dismissed. Mr. Worrall, a former technical advisor at the Centers for Medicare and Medicaid Services, is accused of sharing secrets about government funding with a consultant working for a hedge fund.
In the same case, prosecutors also agreed to bring insider trading and theft allegations against two hedge fund traders and David Blaszczak, political-intelligence consultant whom they believe passed the information from Mr. Worrall.