Corporate Counsel - Battered Brand

The hit to the brand of the General Counsel and other in-house lawyers started when Hollinger GC Mark Kipnis was found guilty in the Hollinger mess - yeah, right along with Conrad Black.  That could have alerted GCs to be alert about becoming accidental or intentional criminals.  And that could have been the end of all that - an isolated incident.

Now, the GC brand has become totally battered. Recently UBS GC David Aufhauser settled on an insider trader allegation with New York Attorney General Andrew Cuomo.  He had been accused of allegedly selling auction rate securities with inside and early knowledge of the difficulties in that market.

Today, Sue Reisinger reports in CORPORATE COUNSEL that former General Re Corporation lawyer Robert Graham could be sentenced to 230 years in prison.  Last February he was convicted of multiple accounts of securities fraud.  His defense attorney describes this activity as, says Reisinger, "a few hours work" on a deal involving fraud.

In the coming era of increased regulation and close scrutiny of financial transactions, corporations will have to do a much better job vetting those they hire for in-house attorney positions and overseeing their conduct.  At the same time, corporate counsel will have to become self-protective about avoiding any appearance or reality of misconduct.