Multiple governmentagencies, from New York state attorney general Andrew Cuomo, to the U.S. Department of Justice, to the Securities and Exchange Commission, are all digging vigorously through the ruins of the financial markets. In July SEC chief Mary Schapiro told members of the House of Representatives Committee on Financial Services that the SEC had opened 439 investigations so far this year, compared to 395 last year, and issued over two times the number of subpoenas. According to a Justice spokeswoman, the Federal Bureau of Investigation is investigating more than 2,100 mortgage fraud cases, an increase of nearly 400 percent from five years ago.
But the tsunami of indictments and lawsuits that white-collar defense attorneys expected in the wake of the financial crisis hasn’t hit yet. “While there have been a lot of reports about stepped-up activity by enforcement agencies, so far, there may be less than meets the eye,” says Davis Polk & Wardwell partner Carey Dunne. Several practitioners say they’re keeping busy with investigations and billing at least the same number of hours as they were last year, but haven’t seen the level of prosecutions increase dramatically.
