A former New York lawyer who lied to federal agents about his role in a stock price manipulation scheme will spend the next two years on federal probation.
Robert S. Brown, formerly with New York's Reitler Brown & Rosenblatt, pleaded guilty in Washington federal district court to obstructing a grand jury's investigation of a so-called stock "scalping" scheme that involved the use of promotional material to tout particular securities.
Brown was one of three lawyers who got caught up in the investigation. Chief Judge Royce Lamberth sentenced Brown on July 3. Melissa Mahler and Franklin Fisher, the other attorneys who were charged, were each sentenced, earlier, to two years of probation.
Prosecutors in Washington recommended Lamberth sentence Brown to probation based on his substantial cooperation with federal investigators. Under the negotiated terms of the plea, prosecutors said Brown faced anywhere from probation to six months in jail. The judge did not impose any period of confinement.
"By all accounts, [Brown] knows better than anyone the life-altering consequences of his criminal choice, including the loss of prestige, profession, and pride as well as a relentless self-torment," an assistant U.S. attorney, Michael Atkinson, wrote in a sentencing memorandum. "The government respectfully submits that, in the particular circumstances of this case, those consequences can serve as a deterrent at least as effectively as a period of incarceration."
Atkinson said Brown didn't offer any excuse for his criminal conduct. "Since accepting responsibility for his conduct, the defendant has demonstrated an extraordinary amount of genuine remorse and regret," the prosecutor said. "Such characteristics suggest that he is unlikely to engage in future criminal conduct."
Brown's attorney, Arthur Jakoby of New York's Herrick, Feinstein said in court papers that "Mr. Brown has accepted responsibility for his offense, and has lived with humiliation and deep regret because of that offense." Brown has lost his license to practice law.
Former Hogan Lovells corporate finance and securities partner Jeffrey Rubin, now general counsel for the Financial Accounting Foundation, said in a letter to the judge that Brown "was as bright, conscientious, thoughtful and hard-working as any attorney I have ever known."
"It is beyond my understanding to know why a person sometimes loses his path," wrote Rubin, who had no personal knowledge of the circumstances related to Brown's criminal conduct. "The regret and sadness I feel by reason of this matter is palpable."
Rubin wrote, later, that "nothing will vitiate the losses, personal and professional, that Bob has experienced and will experience in the future by reason of this sad situation."
Scott Rosenblatt of Reitler Kailas & Rosenblatt—the firm was formerly Reitler Brown & Rosenblatt—practiced with Brown for a decade. Rosenblatt called Brown an "excellent" business partner whose presence in the office has been "sorely missed."
"As you can imagine, the events related to this legal action have had a significant and apparent effect on Bob," Rosenblatt wrote. "Most notably, Bob has had to retool his skill set from that of a corporate lawyer, a profession that he had practiced for over 20 years."