Posted Mar 28, 2014 06:50 pm CDT
More details were revealed Friday about a claimed four-year scheme by leaders of now-shuttered BigLaw firm Dewey & LeBoeuf to, as emails put it, “cook the books,” when six more guilty pleas by former employees were unsealed by a judge in the New York case.
The six were all financial workers working primarily under finance director Francis J. Canellas, whose guilty plea was unsealed Thursday, and Joel Sanders, the firm’s former chief financial officer, according to Bloomberg, the New York Law Journal (sub. req.) and the Wall Street Journal (sub. req.).
Sanders was indicted earlier this month along with three other alleged masterminds of what Manhattan District Attorney Cyrus Vance has described as a massive scheme to defraud. Lawyers for at least three of the four defendants in the ongoing cases have said their clients committed no crime.
Dewey filed for Chapter 11 bankruptcy in 2012 with some $245 million in debts, five years after a merger of two long-established firms that created the 1,300-attorney seeming BigLaw powerhouse.
Four of the financial workers whose deals were unsealed today pleaded guilty to apparent misdemeanors. They are: budget director Ilya Alter; Diane Cascino, who served as the firm’s director of revenue support; partner relations specialist David Rodriguez; and billing director Lourdes Rodriguez.
The other two, controller Thomas Mullikin and accounting manager Jyhjing “Victoria” Harrington, pleaded guilty to first-degree scheme to defraud, a felony.
According to prosecutors and court filings, participants in the claimed scheme falsified Dewey’s bookkeeping to inflate revenue and reduce its obligations in order to obtain bank and private-placement bond financing that leaders hoped would keep the struggling law firm afloat financially until the economy improved.
Among the methods they used, Vance’s office says, were mischaracterizing attorney salary payments, reversing disbursements for written-off debt, pushing clients to backdate checks, delaying expenses and double-booking income.
ABAJournal.com: “Former Dewey chairman and three others are criminally charged in alleged ‘effort to cook the books’”
ABAJournal.com: “Ex-Dewey finance director pleaded guilty to larceny; 6 other pleas expected to be unsealed soon”