SEC Discloses Deals With Ex-Dewey Leaders Sanders, DiCarmine
The agency's case against former Dewey executive Stephen DiCarmine now appears to be over. But that's not the case for other Dewey leaders.
April 17, 2018 at 06:05 PM
3 minute read
The U.S. Securities and Exchange Commission has disclosed details of its settlements with two former Dewey & LeBoeuf executives.
Former Dewey executive director Stephen DiCarmine, under his settlement with the SEC, is required to pay a $35,000 civil penalty, according to court documents filed late Monday. Meanwhile, the SEC agreement with former Dewey Chief Financial Officer Joel Sanders is only a partial settlement. It prohibits him from serving as an officer or director of a public company and leaves open the possibility of a future fine against him.
The SEC had previously announced tentative settlements with Sanders and DiCarmine, but on Monday filed details of their proposed settlements, seeking approval from U.S. District Judge Valerie Caproni of the Southern District of New York.
Two years after Dewey collapsed in 2012, Manhattan prosecutors alleged its executives had lied to banks and investors about the law firm's true financial performance. While a trial acquitted DiCarmine of criminal charges, Sanders was found guilty last year on scheme to defraud, securities fraud and conspiracy charges. Sanders avoided jail time after a New York state judge ordered him to pay a $1 million fine and perform 750 hours of community service.
The SEC brought its civil case against the Dewey executives for securities violations at the same time criminal charges were filed in 2014.
The agency's case against DiCarmine now appears to be over. But that's probably not the case for other former Dewey leaders.
Besides Sanders, the SEC has also reached only partial settlements with ex-Dewey chairman Steven Davis, former finance chairman Francis Canellas and ex-controller Thomas Mullikin. The partial settlements against these defendants mean they have settled with the SEC on liability, but they have not settled on damages, and the SEC could pursue sanctions against them, including disgorgement, interest and civil penalties. In a letter filed in court last year, SEC attorney Howard Fischer said the commission “intends to do so.”
According to a February order, it is anticipated that Caproni will set a motion schedule for damages against Davis, Sanders, Canellas and Mullikin this year.
DiCarmine's attorney in the SEC case, Michael King, a solo practitioner in Chicago formerly with Locke Lord, declined to comment. Akerman securities litigation chairman Brian Miller, who represents Sanders in the SEC case, did not return a message seeking comment.
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