The title of the article telegraphs the reason for his ire: 4 Accused in Law Firm Fraud Ignored a Maxim: Don’t Email.
Thus, the big message of the piece that Dewey & LeBoeuf got caught because they were dumb crooks. And as Black stresses, the story is more perplexed by than critical of their behavior. Worse, its opening paragraph states that covering up misconduct, including criminality, is a normal part of a lawyer’s job:
Several former leaders of the once-high-flying law firm Dewey & LeBoeuf apparently violated a cardinal rule that lawyers always tell their clients: Don’t put anything incriminating into an email.
As Black argues:
The lead sets the bemused tone of the article. The article’s hook is the ironic failure of top lawyers to follow their own advice that they purportedly “always tell their clients” on how to commit fraud with impunity by ensuring that there is no paper (or electronic) trail of “incriminating” evidence of their crime. The “crim” root of the word “incriminating” comes from the Latin word for “crime.” The word “incriminating” means that it provides evidence that one has committed a crime.
What the Deal Book describes as corporate lawyers’ “cardinal rule” is clearly unethical and often a crime. A corporate lawyer who counsels a “client” on how to commit a crime without being prosecuted by using fraud mechanisms that prevent the FBI from finding the “incriminating” evidence establishing the crime has made himself a co-conspirator who is aiding and abetting the fraud. The lawyer has also breached his legal ethical duties and his duties to the client. This is an area with which I have particular experience. I was an attorney at a large law firm and the general counsel of a very large bank. In my regulatory capacity I brought cases and made criminal referrals against several prominent law firms and their partners.
If Deal Book were correct in its purported statement of our “cardinal rule” as corporate counsel, then Deal Book had the financial news scoop of the decade. It should have written a series of articles as soon as it discovered the purported “cardinal rule.”
Now someone might argue that the piece eventually treats the alleged crimes as serious. It does state that the e-mails are “the kind of rogue language that one might expect to find in emails unearthed during a corporate fraud case from the Enron era” but that again simply underscored the “dumb crooks” thesis: a savvy law firm should know not to leave a paper or digital trail of its foul deeds.
One could also argue that Black is unduly exercised, and here I disagree. The rise in corruption in the American elites is due in part to the media giving it a free pass. And that comes about not just via Big Lie declarations that the press parrots uncritically (like Jamie Dimon’s defenses of JP Morgan’s conduct during the London Whale scandal, and their lack of interest in potentially criminal Sarbanes Oxley violation) but via the faux sophistication of “nothing to see here, everyone does it.”
Recall, when billionaire Tom Perkins, after ludicrously comparing the occasional criticism of super rich men like him to Kristallnacht, then doubled down by later arguing that voting rights should be based on wealth levels. Some people treated that remark as a sign that Perkins was insanely out of touch, and Perkins said his suggestion was just a joke.
But one astute reader figured out what Perkins was really up to: that injecting an otherwise unacceptable idea into the discourse, even by pretending to diminish it (claiming it wan’t a serious idea) still legitimates it. Get the otherwise toxic notion enough of an airing, and suddenly it becomes a legitimate subject for discussion.
And here is the real value of DealBook to its backers and advertisers, pretty much all of which hail from the financial services industry. It isn’t simply that DealBook can be relied upon to give the most industry-favoring gloss possible to news on its beat. It is that it also over time undermines what little is left of the old norms of propriety that a mere couple of generations ago were important curbs on bad conduct (being ostracized by many people in your social circle, which is what used to take place, was a very serious punishment. What good is being rich and successful if you get no respect?). And mind you, it does so by taking advantage of the imprimatur of the New York Times, which makes these declarations about norms seem even more authoritative.
As former Lehman Brothers partner* Michael M. Thomas said, the New York Times was over as an institution when Punch Salzberger joined the board of the Met in the early 1980s. That meant he had to do fundraising. As Thomas tartly deserved, “He had to dine with people he should have been dining on.”
So a great paper was sold out for the personal ambitions of its publisher. The erosion has been slow but still noticeable for those paying attention. But so many have become insensitive to this and other evidence of social decay that clear cases like the Dewey & LeBoeuf article don’t attract the attention they warrant.
* This was long before the Dick Fuld era, when pound for pound, Lehman had the best investment bankers on the Street.