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Saturday, February 26, 2011

Why The Biggest Fish Really Go Free

There is an interesting story from the New York Times' Joe Nocera on why the biggest fish in the massive financial meltdown scandals -- AIG, Countrywide, Merrill, Lehman, Bear Stearns, etc. -- have gone free.  Nocera writes that it is difficult to make criminal cases beyond a reasonable doubt in matters involving complex financial fraud, and cites the following reasons:
  • the lack of sophisticated federal prosecutors outside of the island of Manhattan;
  • by implication, the lack of other investigative resources, i.e., investigators and investigative lawyers who know what they are looking at -- the same problem plaguing the Securities and Exchange Commission, by the way; and
  • those darned high-priced white-collar defense lawyers.
Nocera misses the main reason: prosecutorial ambition.

        [For earlier Eric Dixon commentary on prosecutorial ambition and the dangers it poses to your freedom, click here for earlier commentary on the acquittal of two low-level Bear Stearns executives and a recent story on the use of RICO in prosecutions (in which I link to my earlier coverage of Ben Kuehne, Ted Stevens and David Stockman).]

Young, twenty-something -- and dangerously naive -- prosecutors and government lawyers looking to make a name for themselves often look for the biggest scalp -- i.e., the greatest name -- to take in order to build a resume that will land them in a (hopefully) lucrative law firm partnership.  But the reality is that these lawyers are ultimately judged by their won-lost record.  

That's why prosecutors bring the easiest cases.

And sometimes the easiest cases are against the smaller -- or smallest -- fish.  Sometimes these are the ones who are the least able to fight back and defend themselves; sometimes they might even be totally innocent.  And sometimes that just doesn't matter.

Eric Dixon is a New York lawyer.  Mr. Dixon can be reached for further comment at  

Friday, February 25, 2011

New York Mets Approach Insolvency, Bankruptcy

Weeks after Crime, Politics and Policy first predicted that the New York Mets might declare bankruptcy as a result of its owners' potential $1 billion clawback liability from the Bernard Madoff fraud, press reports today state that Major League Baseball advanced the Mets $25 million in November 2010.

On a different note: Could the Mets' owners get indicted as a result of their possible complicity in the Madoff scam?

This private loan strongly indicates that conventional financing -- from banks or private investors -- was not available to the Mets, not on favorable terms, and very likely, not at all.

This revelation suggests that the Mets are currently facing a cash flow crisis and are near -- if not already  in a state of -- insolvency.   Bankruptcy often follows in such cases, and this is a likely option given the Mets' and affiliate cable network SNY's heavy debt load.

This revelation will further diminish the Mets' negotiating leverage on any sale of a minority stake of the franchise.  It grows likelier by the day that Mets' ownership will have to consider sellling a majority stake or even the entire franchise, possibly selling part or all of SNY, and making other drastic moves to fend off insolvency and bankruptcy.

Meanwhile, the value of the enterprises should already be in a free fall, and this should be continuing.  The Mets' death spiral has begun.

Eric Dixon is a New York lawyer specializing in analytical, strategic and investigative legal matters.  Mr. Dixon offers litigation counseling, litigation stress management and assertiveness training for people facing legal and other conflicts.  Mr. Dixon began his career as a corporate transactional lawyer drafting and negotiating major business agreements.  Mr. Dixon is available for further comment via email at

Wednesday, February 23, 2011

Mortgage Principal Reductions Mock The Responsible

UPDATE:  The Wall Street Journal reports today that some major mortgage banks have reduced mortgage principal for over 100,000 homeowners. 

Of course, this is paid you and I.  The banks will recoup those reductions -- losses -- by jacking up fees from everyone else doing business with the banks. 

It also raises anew the question of fairness:  Why do some homeowners get a reduction -- the equivalent of free money -- while others have to pay both their full amount and subsidize reductions for others?

This is sparking a crisis of fairness in which average Americans now assume that the major institutions of society (whether public or private) are not fair.  One should expect an increase in antisocial, narcissistic and even criminal behavior as people seek to rationalize this new consciousness of unfairness.

George Orwell could not have said it better in his iconic work Animal Farm.

     *     *     *     *     *     * 

Earlier original column:    The Obama Administration is pushing leading banks to settle existing lawsuits over their serious mortgage servicing problems by paying a reported $20 billion to fund mortgage principal reductions.

Reducing your debt principal is the equivalent of giving you money. It's like handing out winning lottery tickets -- free money -- to some, after sticking you with the bill.

This proposal would call for the banks to use their own money to "bear the cost of all writedowns rather than passing them on to other investors." In reality, any cost will be passed on -- eventually and however circuituously -- to shareholders and the customer (depositors and borrowers) -- in the form of:
  • lower savings rates,
  • reduced services,
  • worse customer service,
  • higher fees,
  • shorter payment periods and higher loan interest rates.

All of this, to keep your deadbeat neighbors in their homes (well, that's not really accurate) a little longer.  Crime, Politics and Policy: By Eric Dixon has previously been critical of strategic defaults and suggested criminal penalties might be in order, criticized the underwater borrowers who now assert that they are victims -- when in reality they're victims of their own greed -- and separately has proposed a positive principal reduction program that promises to recapitalize the supposedly- troubled banks and rewards responsible homeowners. 

The Wall Street Journal article (Thursday edition) mentions that bank executives say that "principal cuts don't necessarily improve payment patterns" while they may raise "new complications" like how to decide whose mortgage gets reduced.

The potential for great unfairness and a degradation in the popular belief of an equal, level playing field is held in this proposal.

Eric Dixon is a New York lawyer and strategist who has previously proposed borrower-based mortgage principal reductions in order to capitalize banks and reward responsible, financially healthy homeowners. Mr. Dixon can be reached for further comment at

Nullifying the Defense of Marriage Act

hThe Obama Administration will essentially nullify the will of Congress by refusing to defend the Defense of Marriage Act in court against legal challenge. 

The Act was passed in 1996, and defines marriage as being between a man and a woman.

This nullification-through-default threatens a constitutional crisis. The Administration sets a precedent by which it can circumvent, or outright ignore, the will of Congress.

While some have constitutional concerns about the Act, this law is not recently-enacted legislation, but a 15-year-old law for which more than ample time has passed for it to be challenged in court and evaluated by courts at all levels. In addition, the Obama Administration just had two years, during which it controlled both houses of Congress, in which it could have sought its amendment or repeal -- but chose not to do so.

It is one matter for Congress to need sufficient support to override a presidential veto. It is quite another for it to overcome executive branch nullification through default.

Eric Dixon is a New York lawyer, political advisor and strategic analyst. He can be reached at

Fox Guarding Henhouse? SEC Criminal Complicity in Madoff Fraud?

Disgruntled victims of the Bernie Madoff fraud looking to nail the Securities and Exchange Commission for its failure to detect, investigate and ultimately stop the huge scam just got more ammunition.

A lawsuit brought by bankruptcy court-appointed trustee Irving Picard against the former general counsel of the Securities and Exchange Commission, David Becker, whose family allegedly made more than $1 million in profit from the Madoff Ponzi scheme, suggests possible complicity by the SEC in the mammoth scandal.

Becker reportedly leaves his role as Mr. Magoo  post as SEC general counsel for the "private sector" in just a few days.  Presumably, with 35-plus years of legal experience, this will be a cushy partnership at a major Washington, D.C. law firm.  (Note: Picard's lawsuit was filed under seal in November 2010.)  Perhaps Becker left government service for the big firm partnership salary and draw (i.e., share of profits), in contemplation of the need to eventually write out a big check.

Becker's official New York attorney registration has not been updated to show the move.

Let's see whether Mr. Becker keeps that partnership title, ever sees even one check of his partnership draw (assuming, of course, that he is an equity partner and not an "income partner") or even is allowed in the front door of whatever firm is willing to tolerate the bad publicity.   

One must wonder whether the SEC's failure to detect, much less investigate, the fraud was the result of deliberate concealment (in which case felony criminal charges for "misprision of a felony" would be warranted), as opposed to merely horrendous, legendary incompetence.

One can be sure -- or at least hope -- that the U.S. Attorney's Office in Manhattan (or perhaps Main Justice, as the national head office in Washington is called by insiders) is watching.

Eric Dixon is a New York lawyer with a background in securities compliance.  The views expressed in this article are opinion only and do not constitute legal advice.  Mr. Dixon is available for further comment at

Tuesday, February 22, 2011

Housing to Zero? Shiller Sees Up to 25% Drop

The latest monthly Case-Shiller Home Price Index data for the 20 largest metropolitan areas show a 1 percent monthly drop in December 2010 from November 2010. However, comments from Robert Shiller are noteworthy. Shiller stated during a conference call that he sees "a substantial risk" of a 15 to 25 percent decline from current levels.

Such a drop would mean that average home prices would have declined by approximately one-half from their 2006 highs on a peak-to-trough basis.

Eric Dixon is a New York lawyer, strategic analyst and crisis management consultant. He can be reached at


Monday, February 21, 2011

Could Mets Owners Get Indicted in Madoff Mess?

A new report in today's New York Times indicates that New York Mets owners Fred Wilpon and Saul Katz operated an investment conduit for Bernard Madoff, searching for and selecting less sophisticated investors -- presumably easier to deceive -- for which secrecy and the agreement to ask no questions were requirements to be invited to invest.

If such allegations can be sustained, one might wonder whether criminal exposure -- meaning criminal prosecution -- could result from such activities.  It is not hard to see the potential for a criminal conspiracy charge against Wilpon, Katz or any of an assorted group of associates who did participate in the alleged activities.  Given the magnitude of the monetary losses in the Madoff fraud, the federal sentencing guidelines (which are now advisory but still largely followed) suggest major jail time could be in the offing.

The stakes for the Mets' owners are certainly very high; if my theory is correct, their freedom could be at stake.  The public veneer of stiff upper lips may conceal the very harsh reality: the specter of criminal prosecution for complicity in the investment fraud of all time, for which participation (if proven) could result in effective lifetime sentences for conspirators.

Eric Dixon is a New York lawyer who handles crisis management, litigation stress management and mental strength training for people who are sued, investigated or prosecuted.  Mr. Dixon is available for further comment or consultation at 917-696-2442 and via e-mail at

A Near-Admission: Christie To Throw His Weight Around in 2012

Is the world ready for a roly-poly American President?

Still-rotund, cherubic New Jersey Governor Chris Christie doth protest too much.

The rotund governor -- and darling of know-nothings who profess to be 'conservative' -- is playing coy, but strong evidence (from Politico's and the New York Post's Maggie Haberman) that he is indeed planning to run in 2012 comes in the admission from Christie's "consligere" William Palatucci that he (meaning, Christie, presumably) is considering forming an exploratory committee for a 2012 run.

Of course, statements like this don't get made without explicit permission from the top.  And Palatucci has never during his political dabbling days been considered anything remotely resembling a loose cannon.

Crime, Politics and Policy has long considered Christie a 2012 candidate pretending to be bashful.  The number of articles are too plentiful; browse the archives on the right corner of your screen.

Additional credit should be given to the Star-Ledger's conservative commentator, Paul Mulshine (whose columns and blog posts are available frequently at, who has consistently questioned Christie on policy and ideological matters. 

Eric Dixon is a New York lawyer and strategist who represents individuals, businesses and political organizations on a variety of legal, managerial and policy matters.  Mr. Dixon is available for comment or consultation at

Abusing The Material Witness Designation

A new report suggests that the federal government has, at least since 9/11 -- or nearly ten years ago, been abusing the material witness designation of regular, innocent Americans as a way to facilitate investigations into suspected crimes including, but by no means limited to, terrorism or terrorism-related crimes.

In plain English, this means that entirely innocent people have been detained, imprisoned and otherwise treated unconstitutionally at the behest of, and for the convenience of, the federal government.

In short, the government has seen fit to violate the constitutional rights of innocent Americans, as that is seen as a convenient short-cut to acquiring necessary evidence in a particular case.  Apparently, violating rights has taken the place of old-fashioned investigative work. 

The suffering sustained by average, hard-working and innocent Americans is simply considered by some to be acceptable collateral damage.  

This is unacceptable.

Eric Dixon is a New York lawyer. 

Saturday, February 19, 2011

Victory for a Countrywide Whistleblower; Mozilo Gets A Pass

A Countrywide Financial Corporation executive-turned-whistleblower, Michael Winston, won a partial victory in a California state court this past week when a jury awarded him $3.8 million in damages for wrongful terminating and retaliating against him for refusing to play ball with the company's C-level executives.

The case may be instructive for what employees can expect when they refuse to go along with questionable, if not outright illegal, practices.  In some companies across corporate America, the mere act of refusing to engage in criminal or unethical behavior can be viewed by human resources directors, hiring managers and other high-level corporate executives as disloyalty, insubordination and the justification for being fired "for cause." 

Mind you, these ethically-challenged individuals are often the same people who make decisions, on behalf of the corporations, as to which hapless employee will be "thrown under the bus" when the Justice Department or Securities and Exchange Commission starts investigating corporate misconduct. 

On a separate note, it appears from an unnamed source that a criminal investigation involving Countrywide's founder and chief executive officer, Angelo Mozilo, has been closed with no further action to be taken.  

Eric Dixon is a New York lawyer, strategic analyst and commentator.    

Anti-Terror Incompetence By The Feds

An appalling new report suggests that the federal government, perhaps up to the highest levels, is trying to hide cover up evidence of its being victimized by a con man absolute incompetence in discerning effective anti-terrorism technology (if such a thing exists) from an absolute fraud.

The latest report will become the newest ammunition for those who argue that the entire post-9/11 anti-terror apparatus has been nothing but a cynical exercise in "crony capitalism," designed to line the pockets of the politically favored, waste insane amounts of taxpayer money, and diminish the liberty of ordinary, law-abiding Americans in order to facilitate it all.  This goes right up there with the billions of dollars spent on airplane passenger scanners by the Transportation Security Agency, the entire "money pit" known as the Department of Homeland Security, and the diminution of rights effected by the Patriot Act.

This absolute outrage calls to mind the impotence of our fictional spies in the old Walter Matthau espionage thriller, Hopscotch.  Here's a headscratcher for readers:  In that movie, what alternate definition did Ned Beatty use for the acronym 'FBI'? 

Eric Dixon is a New York lawyer.  His views are his own and as such, constitute protected speech.

Thursday, February 17, 2011

SEC Whistleblower Regulation: Shooting The Mailman

Repressive regimes wishing to squash popular uprisings learn it's far more efficient to cut off the Internet (see: Eqypt) or shoot the messengers, instead of going after individual protestors. 

The same coldly efficient philosophy may be behind the movement to revise proposed new Securities and Exchange Commission regulations to force corporate whistleblowers to report suspected wrongdoing inside the company first. 

Crime, Politics and Policy's Eric Dixon was highly critical in a December 2010 comment letter to the SEC of the impact of proposed new whistleblower regulations on in-house lawyers.

(The Wall Street Journal is only noticing this issue now, but the SEC released proposed regulations in early November 2010 for public comment.  This is old news.

This sentiment works well...unless the wrongdoing is being committed by the people to whom you report.  In such a case, self-reporting may be career suicide...or worse.

Naturally, corrupt corporate managements will love a requirement for internal reporting.  They will get "tipped off" that wrongdoing has been noticed.  They will know who knows, what they know and, to some extent, can make an educated guess as to what they could say down the road as a potential witness.

Of course, with such advance warning, corrupt managers can then start secreting away -- or destroying -- evidence of wrongdoing.

No wonder large corporations are in favor of such an internal reporting requirement.

Eric Dixon is a New York lawyer.  The comments here are opinion only and do not constitute legal advice. 

Wednesday, February 16, 2011

Housing To Zero? Bigger Down Payments, That's Why

The Wall Street Journal announces today that banks asking for larger down payments from buyers is another factor putting downward pressure on residential real estate.

As teenagers and younger adults would say:  Duh!

Crime, Politics and Policy (in other words, the honorable moi) theorized just as much several months ago in this October 2010 article.  If you've been following this blog, the Journal's page one story (link) will not be news to you.

Eric Dixon is a New York lawyer and strategic analyst who advises businesses, individuals and political organizations on legal, strategic, crisis management and organizational matters.  Mr. Dixon has practiced law for 16 years since graduating from Yale Law School in 1994.  Mr. Dixon is available for further comment via email at

Tuesday, February 15, 2011

Biometric Tracking of Your Kids?

Excellent investigative reporting by WND's Jerome Corsi has uncovered a Mexican plan to use biometric technology to track children.  This has implications for privacy and other civil liberties intrusions under an ongoing and emerging plan to incorporate national security matters under an umbrella Security and Prosperity Partnership working group plan covering the United States, Mexico and Canada. (Corsi and WND have previously reported on surreptitious plans to form a 'North American Union' and even incorporate the three countries' currencies into one currency.)

One problem with any such incorporation is the dilution of any security and civil liberties protections to the lowest common denominator.  As American liberties and principles are rarely respected to the same degree by any other country on Earth, any multinational unity -- of any kind -- naturally risks dilution of our rights, freedoms and protections.

Eric Dixon is a New York lawyer who represents businesses, individuals and political organizations on legal, strategic, crisis management and litigation stress management matters.  Mr. Dixon can be reached for further comment or consultation at 917-696-2442 or

New York's Doomsday Legal Manual

New York State's Unified Court System has issued a Doomsday-type report suggesting what steps the legal and judiciary systems should take in the event of a major catastrophe.  The report focuses primarily on biohazards and other similar events like outbreaks of communicable and non-controllable diseases. (Think about the 1995 movie Outbreak starring Dustin Hoffman and Rene Russo.)  Although natural disasters and man-made unrest are not specifically mentioned, this report could be viewed as a precursor, a template, for similar measures to be adopted in case those events transpire.

Some of the highlights of the report are:
  • page 33:  seizure of private property; and
  • pages 48 and 50: suspension of local laws;
The report is designed to be a framework for true emergencies.  However, it illustrates the danger to our freedoms proposed by any "conquering heo" who asserts -- wrongly -- that a disaster has befallen us.

Eric Dixon is a New York lawyer.  This column is an opinion only and does not purport to offer legal advice.  Mr. Dixon is available for further comment and consultation at 917-696-2442 and via e-mail at

Sunday, February 13, 2011

Cyberbullying: How to Protect the Innocent

An article in Sunday's Bergen Record details a years-long cyberbullying attack on a now-15-year-old's name and reputation, illustrating the difficulty in catching cyberbullies as well as deterring their malicious activities.

It was one thing to track down the attacker.  It is quite another to define what is legal and illegal activity on the Internet.

The problem with "drawing the line" is the risk of criminalizing perfectly legal expression, even if its target is unwelcome or the expression is embarrassing or even harmful.  Negative opinions are not and never should be a crime. This should be a paramount concern in a society and economy such as ours where the ability to blow the whistle is often the key to protecting the public against terrorists, criminals, predators and unscrupulous business owners.

If anti-cyberbullying laws are not crafted correctly with these concerns in mind, these laws will become a shield for criminals and deadbeats who, wishing to avoid the consequences of their actions, can "cry wolf" and brand legitimate whistleblowers, creditors and victims with the new 21st Century version of the scarlet letter -- cyberbully.

In the unfortunate case of the Newark teen, who was using various Internet social media as a young teenager, perhaps this travesty raises a different issue:  Are parents simply not exercising the proper discretion and control over their kids' Internet activities?   Shouldn't we ask parents to do their job first, before we rush to restrict -- and criminalize -- the freedom of expression of other, entirely lawful activities and put the liberty of perfectly innocent people in jeopardy?

Eric Dixon is a New York lawyer who advises businesses, individuals and political organizations on various legal matters including reputation defense, litigation stress management, assertiveness training, damage control and crisis management.  Mr. Dixon is available for further comment at and by phone at 917-696-2442.

RICO: Prosecutors' Tool or Enemy of Capitalism?

The mainstream media is looking for news to cover, and is hoping that some recent comments by Manhattan's U.S. Attorney Preet Bharara signal a new wave of innovative prosecutions of wayward hedge funds and other businesses.

Note the difference.  Prosecutions of the business entities themselves would be the objective of these supposedly-new applications of existing laws.  Investigatng (but not necessarily prosecuting) individuals involved would be a secondary objective, and necessary only to get the requisite cooperating witnesses, and hopefully ones who have some credibility and character (unlike New Jersey's uber-criminal Solomon Dwek).

This Sunday news article is really not news.  Prosecutors think of new applications for existing laws all the time.  This is only getting noticed now because insider trading has become noticed, and because losers in the stock market have been complaining (not that there's anything wrong with that).  The general public should welcome this trend as a sign that our prosecutors have become less chummy with big business -- in other words, the people who could become future employers of these prosecutors once they get tired of making, at most, about $160,000 at the top of the federal pay scale.

RICO has been around for decades.  If it hasn't been used more, that's most likely a sign of the strength of the evidence in those cases and ability to use more directed statutes covering substantive crimes.  Prosecutors can and should bring cases using the strongest statutes that make it the easiest to prove a crime was committed.  That is, after all, their job.

It would be nice to see more cases involving the use of the conspiracy statute to go after wanton obstruction of justice.   There remain far too many people -- young hotshots and old codgers alike -- who lie, cheat and steal with absolute impunity.  

While I refrain from giving legal advice in any article, I will note that one cannot make a false statement if one never talks.  Remaining silent -- whether you assert your rights under the Fifth Amendment or simply elect to not talk as a strategic course of action -- may expose you to snickers from the press, neighbors and other people (none of whom have your best interests at heart, incidentally).  But the mere act of talking may expose you to some risk of prosecution -- and ultimately, of incarceration -- if the prosecutors and investigators are not acting in good faith and instead are adopting that old Soviet philosophy of "show me the man and I'll show you the crime."

Sometimes it's better to suffer a reputational risk, than to expose oneself to actually being prosecuted by very ambitious, headline-seeking prosecutors.  Go ask Barry Bonds or Roger Clemens (both facing upcoming trials for perjury).

On the other hand, some commentators are correct that society and business have become too overcriminalized, leading to entirely innocent people getting ruined or damaged, or facing the threat of reputational and financial ruin.  (See earlier articles on the late Senator Ted Stevens, noted Miami lawyer Ben Kuehne, former CEO David Stockman and former Reagan Administration Labor Secretary Raymond Donovan). 

There is always the risk that the multitude of criminal statutes on our books will trip up unsuspecting business owners.  It certainly seems as if the recent insider trading prosecutions are meant to go after not just wayward hedge fund managers and corporate tippers, but an entire way of doing business (that is, using these "expert networks" that appear to do little but trade in what is arguably, non-public, "material" information) and quite possibly, the "hedge fund industry" as a whole.

The problem with these prosecutions and investigations is that innocent people, with every desire -- and motivation -- to obey the law, are still at risk of an erroneous investigation.  There is no bright-line definition of what is "material" information.  Hence, the decision to charge someone (either civilly or criminally) with an insider-trading crime or violation remains largely arbitrary, discretionary...and subject to abuse.

Eric Dixon is a New York lawyer.  This article is opinion only and is not legal advice.  Mr. Dixon consults with clients facing investigations, lawsuits and prosecution on litigation stress management, assertiveness training and other techniques for coping with the burden of such potentially life-altering legal matters.  Mr. Dixon is available for consultation at 917-696-2442 and may be reached by e-mail at


Saturday, February 12, 2011

Old-Time Hockey: Fights Abound In Islanders-Penguins Grudge Rematch

Friday night at the Nassau Coliseum, the hockey game between the Pittsburgh Penguins and New York Islanders evoked memories of true old-time hockey.  With each team missing its best players, the remaining combatants  the sort indulged in by the likes of Dave Schultz, Tiger Williams and . . . Reg Dunlop, the Hanson Brothers and even Jonathan E.  (Keep reading to get the movie references.) 

A staggering 346 penalty minutes were recorded by the two teams (183 for Islanders' players, 163 for Penguins' players).  So many players were thrown out of the game that by the last five minutes of the third and final period, both teams had barely enough eligible players to step onto the ice.
Oh, by the way, the final score last night was a shocking 9-3 Islanders victory over the 2009 Stanley Cup champions (admittedly, the Penguins are missing their best players, Sidney Crosby and Evgeni Malkin, to injury.

Friday Night Fights at the Coliseum:  After the score was 6-0 Islanders (there's a shock!) early in the second period, fights became commonplace at virtually every play stoppage.  Real fights involving obscure tough guys from the minor leagues -- like the Pens' Dave Tangredi and Isles' Micheal Haley -- called up to fill in for injured players.  Fights involving the Islanders' Trevor Gillies, who is unrelated to former Islander legend and Hockey Hall of Famer Clark Gillies (and who, contrary to legend, was very disinclined to fight but equally proficient when he felt provoked). 

NHL teams dress 20 players for a game.  Count the number of expulsions (10) from the official game night stat sheet, add in five-minute fighting majors when less time remained in the third period, and determine for yourself how many players remained standing and eligible to play by the end.  By the last two minutes, there were not enough players for a shift change!  The game even featured a rare moment when a player -- the Penguins' Eric Godard -- left the bench (this is prohibited) to engage in a fight.  Watch the clip below and look for number 28 in white from the right side of your screen.

Truly a war of attrition.  Just like the 1975 cult classic Rollerball, starring James Caan (aka Sonny Corleone) as Jonathan E.

 As notable Islanders/NHL blogger Chris Botta noted on his Islanders Point Blank blog, the game -- from an Islanders standpoint -- should have been devoted to former Islanders Garry Howatt (the "Toy Tiger" from the late 1970s and first Cup season of 1980), Clark Gillies and Bob Nystrom. The aforementioned triumvirate were always notable for standing up for the Islanders' skill players (Hall of Famers Mike Bossy and Bryan Trottier) when other teams would try to intimidate them.

Tonight's game brought back old memories of true old-time hockey.  Check out this legendary bench-clearing brawl between the Philadelphia Flyers and New York Islanders from January 1979.

Compare it with one of my favorite clips from the legendary cult classic Slap Shot (warning: profanity):

Eric Dixon is a New York lawyer.  Mr. Dixon helps business, individual and political clients with legal and strategic matters, crisis management, assertiveness training and  litigation stress management.  Mr. Dixon is a former New York Islanders season ticket holder and has been a hockey fan since 1975.

Friday, February 11, 2011

Housing Going To Zero? Interest Rates Over 5% Will Force Home Prices Down Even More

Mortgage interest rates are now above five percent.  This threatens to be another source of downward pressure on home prices.  The Wall Street Journal speculates on this today...just as we predicted back on October 6, 2010 with our post, "The Coming Housing Price Crash."

Rising interest rates directly and negatively affect affordability as measured by the ability to make a given monthly payment.  (Rising home insurance rates and fees, and property taxes, all of which are typically bundled together in monthly payments, will have the same impact but the source will not be as obvious.)  A lower monthly affordability ceiling translates directly to a lower mortgage loan amount the bank will grant, hence directly and unavoidably forcing prices down.  (This is the exact opposite of the effect of historically-low interest rates during the housing bubble between 2002-07.  Same principles, but now you'll see it work in reverse.)

We predict that the current slowdown in foreclosures, owing to allegedly massive bank screw-ups (that's really the best way to put it), will simply push the "overhang" of housing supply into the future.  A growing supply of for-sale houses in, say, the third quarter of 2011 will be yet another strong reason for housing prices to remain depressed, if not continue a significant decline.  (Reminder:  As with politics, with housing, everything is local.  Some markets are strong -- others are incredibly weak.)

Eric Dixon is a New York lawyer.  Mr. Dixon specializes in legal matters and consults with clients on strategic matters, litigation stress management, crisis management and assertiveness training.  Mr. Dixon is available at 917-696-2442 and via e-mail at

Tuesday, February 8, 2011

Is Bloomberg a Co-Conspirator in Haggerty Campaign Funds Case?

Manhattan prosecutors revealed that Mayor Bloomberg was a secret grand jury witness in the criminal investigation of Bloomberg campaign operative John Haggerty.

Questions: Given that Bloomberg curiously wrote a check to the New York State Independence Party in order to ensure that Haggerty's payment would not require disclosure until well after the 2010 election, could Bloomberg risk legal -- criminal -- exposure to a charge of having conspired to evade the campaign reporting requirements?

Why isn't the Manhattan U.S. Attorney's Office -- or that in Albany -- investigating Bloomberg's necessary role in this? (The answer is obvious if you're a cynic.). Why aren't federal charges in the offing?

Since when is a fairly transparent effort to avoid campaign finance reporting requirements -- certainly an effort that seems to clearly involve the "mens rea" or intent element that is a necessary element of virtually any crime -- not worthy of an investigation?  Let's compare this with the situation involving former New Jersey lawmaker Joseph Vas.

In New Jersey, an ongoing state and federal prosecution into similar activities relating to the unsuccessful 2006 congressional primary campaign of former Perth Amboy mayor Joseph Vas has resulted in guilty pleas by co-conspirators and a federal criminal conviction of Vas plus his plea this past fall to state criminal charges.
 Eric Dixon is a New York election lawyer.  Mr. Dixon represents businesses, individuals and political organizations on legal and strategic matters, including counseling people involved in investigations and lawsuits on how to cope with the stress of being sued, investigated or prosecuted. He can be reached at 917-696-2442 and by e-mail at

Destroy Evidence, Go Directly To Jail?

The new federal criminal insider trading charges against three hedge fund managers and one hedge fund analyst include some juicy allegations of hilarious attempts to destroy allegedly incriminating evidence.


Since when did it become a federal crime to chop up -- or throw away -- your computer hard drive? (Especially if there was no cease and desist order or outstanding subpoena.)

Is throwing out the trash now potentially a federal crime? After all, one never knows what the federal government will consider to be evidence of a crime?

Eric Dixon is a New York lawyer who investigates complex matters and helps people deal with the stress of being sued, investigated or prosecuted.  Mr. Dixon can be reached via e-mail at and by phone at 917-696-2442.


Hedge Fund Criminal Charges Coming

Are people being targeted unfairly by ambitious government prosecutors, or are there too many arrogant people in finance who think they can get away with virtually anything, who think they can lie to investigators?

A noon press conference is scheduled by Manhattan U.S. Attorney Preet Bharara to announce charges against three hedge fund managers and two hedge fund analysts.

Sounds like running a hedge fund is becoming a risky proposition. Or is it an industry niche attracting the wrong types?

Eric Dixon is a New York lawyer and strategic analyst.  He is available for further comment or consultation at and 917-696-2442.

Sunday, February 6, 2011

Making Commuters Tolerate the Homeless

An absolutely inconsiderate policy of tolerating masses of stinking homeless people to camp out on New York City subways and transportation terminals, including, most notably, midtown's Port Authority Bus Terminal, has the potential to depress the City's economy and tourist trade if further deterioration continues.

Port Authority now cordons off sections of the front entrances of each of its midtown bus terminal buildings after 1 am for the homeless. At that time, the terminal becomes officially closed to all except those with bus tickets.

The terminal officially opens at 5 am. The overnight homeless population -- as counted in the front vestibule "bullpens" -- numbers about 25. There is a homeless shelter one block away on West 41st Street, west of Ninth Avenue, where the remainder may go.

The overnight closing demonstrates that the Port Authority is willing to move out the homeless -- when it is for its own convenience. The policy allows for a cleaning of the facilitites during the lowest-ridership hours. It shows that, during the other 20 hours of the day, the stinking masses are totally welcome to befoul the facility because the bus terminal is "open to the public."

The same tolerance is in effect on the subways -- which never close.

It means New York City has -- at least in appearance if not in official policy -- reverted to the erroneous and ineffective policies of the pre-Giuliani days (before Bill Bratton implemented his "broken windows" theory) when Times Square was still teeming with street hookers and open-air drug markets, squeezee men roamed major intersections...and violent crime was much higher than it is today.
New Yorkers who remember 42nd Street in the pre-Disney days, infested by hookers, drug dealers and solicitors for porn shops will recognize the deterioration. Arguably, these are the "real" New Yorkers, the men and women who were here in the 1960s, 1970s and 1980s, whose view of New York was shaped by Death Wish, The Warriors and Escape from New York.

Tourists and relatively new New Yorkers -- that is, out-of-towners -- whose view of The City is shaped by Sex and the City (the HBO show, not necessarily the original Candace Bushnell columns in the New York Observer, circa 199) have not caught on to the change.
 Even worse, and more alarming, is the apparent indifference of the Port Authority police (that is, of the officers who remain and who likely are overburdened) and other authorities to the problem. Most commuters also don't seem terribly annoyed -- not yet, anyway -- and this is the most dangerous signal of all. Such indifference, bordering on tolerance, acts as an invitation for more homeless or panhandlers to come into the terminal and hassle, annoy and offend commuters and travelers.

The younger generation -- the under-30 set -- is woefully unprepared for this change. This is the generation whose members have never encountered a New York City (that is, Manhattan south of 96th Street) is unsafe after sunset. This generation, not remembering the years when 2,000 people were annually murdered in the City and violent crime was expected, is extremely vulnerable because its members never developed the hightened sense of awareness and fear which served as a protective mechanism even back in the early 1990s.

Notably, other transportation hubs -- Grand Central Station -- are not so afflicted. There are signs of a similar situation at Penn Station, but the homeless there seem to be more physically segregated from the "gen pop" (that is, commuters) and hence not as much of an apparent problem.
 Certain subway lines also appear to be afflicted by an invasion of homeless. In particular, the subway lines that used to be called the Eighth Avenue IND -- the A, C and E lines -- are now reported to be consistently plagued by homeless, to the tune of one person per car, at any hour of the day, on a daily basis.
 If the homeless explosion is one of appearance, it may stem from the lack of police enforcement. This may be due to nothing more than manpower reductions, but another cause may be at work.

Public employees at all levels are suffering (or believe themselves to be suffering) from salary freezes, benefit cuts and requirements to contribute to their own health care and other benefits. Whatever the merits of such moves and putting aside the question of whether the workers are being adequately paid, or overpaid, for the work they are supposed to be doing, one fact is clear: such changes amount to a de facto pay cut.
 Combine that with threats of job cuts, budget cuts and benefit cuts, and you have a recipe for a tremendous drop in public employee morale.
 In such an environment, will police officers "go the extra mile" to roust and confront the homeless in the most visible places in the City?

City leadership needs to notice and act on this problem. Tolerance of violent homeless sends a dangerous message to those of us who travel into the City for business, education or entertainment. It also encourages business owners and managers to move to, or stay in, the suburbs.
Eric Dixon is a New York lawyer who handles election law, investigations and litigation stress consulting through his firm, Eric Dixon LLC. Mr. Dixon is available for comment or consultation at 917-696-2442 and via e-mail at

Avoiding Criticism: Quoting the Great Fred Shero

"To avoid criticism, say nothing, do nothing, be nothing."

-- from legendary hockey coach, and Hockey Hall of Famer, Fred Shero

Saturday, February 5, 2011

Mets Face Bankruptcy, Total Sale

One week ago, Crime, Politics and Policy predicted that the New York Mets would face either a total sale or even bankruptcy as a result of their owners' liabilities from the Bernard Madoff financial fraud. 

Now that the Madoff bankruptcy trustee's lawsuit against Mets' owners Fred Wilpon and other family members and associates was unsealed on Friday, other analysts are coming to the same conclusion.

Eric Dixon is a New York lawyer and strategic analyst who consults with businesses, individuals and political clients on legal, crisis management and strategic matters.  Mr. Dixon can be reached for further comment at 917-696-2442 and via e-mail at

Rick DiPietro Shows Emotional Immaturity At Work

People often fail in the workplace, even if they are smart, hard-working and responsible, because of a glaring emotional immaturity or poor judgment.

Sometimes this "low emotional IQ" takes the form of inappropriate (for the office) comments or otherwise inappropriate behavior.  The workplace is never the place to show one's "wild side."  Sometimes -- and most often with women -- it takes the form of inappropriate dress. 

But other times, it really manifests itself in the form of horrible judgment.  Employees should be aware that one serious indiscretion can color, indelibly and permanently, his or her supervisors' perception of that employee's future potential for greater responsibility.  (For this reason, it is prudent to never get drunk with the boss.) 

The latest shocking workplace episode comes from the world of sports.  

Often-injured (and former concussion victim) New York Islanders goaltender Rick DiPietro decided to prove his manhood late in a game (that is, the final 20 seconds) this past Wednesday night.

A decision to first precipitate hostilities, and then to fight, led to a one-punch knockdown in which DiPietro suffered facial fractures and will be out of action at least four to six weeks.

(Did I mention DiPietro's history of concussions, including one in March 2007?)

DiPietro has been injured often, during the course of his 15-year, $67 million contract that still has 10 years to run.  He continues to battle knee problems that periodically flare up and keep him out of action, despite several injuries and lengthy rehabilitations. 

In my opinion, DiPietro lacks the requisite durability to be an NHL goaltender, as being able to avoid chronic injuries rendering oneself unable to play is a necessary element to being a professional athlete in a violent contact sport.  I would predict the Islanders will buy out his contract once they share that assessment.

DiPietro's behavior is troubling, for it is shockingly immature and irresponsible.  It is worse, from a business standpoint, when one considers the context: DiPietro is almost 30 years old and makes US$4.5 million for each of the next ten seasons.  In short, DiPietro put his employer -- the Islanders' hockey team -- at major risk, this after already sustaining numerous injuries and having the club make a sizable financial investment in him.

Such a lack of emotional maturity in the workplace demonstrates a "me first" attitude that imperils an employer.  In a regular workplace, such behavior can get one fired.

Eric Dixon is a New York lawyer and strategic analyst who provides crisis management and strategic consulting services to businesses, individuals and political organizations.  Mr. Dixon can be reached for further comment at 917-696-2442 and via e-mail at


Friday, February 4, 2011

Is Andy Pettitte A Criminal?

The noted New York Yankees pitcher Andy Pettitte may be retiring because he may be an unindicted co-conspirator in the baseball steroid scandal that the federal government has deemed to be criminal.

Pettitte will announce his baseball retirement later today. 

Pettitte is scheduled to be a witness against Roger Clemens in his upcoming criminal trial on perjury charges.  Pettitte and Clemens were close friends, and for Pettitte to testify as a government witness against his friend strongly suggests that Pettitte agreed to testify -- and perhaps even to retire from baseball -- as part of a deal to avoid federal prosecution on criminal charges. 

It is rare for a man to testify -- except under great duress -- against his friend.  There has to be a strong incentive to do this (read: being threatened with going to jail) and it's not just the process of "coming clean." It is very likely that Pettitte has been told that he must testify against Clemens in order to avoid being prosecuted.  For what, I cannot speculate.  I merely connect the dots and draw some inferences and opinions.

Turn the analysis around.  If you were innocent, and had a good chance of establishing your innocence (which is the practical truth, in my opinion, despite the official legal standard that it is the government with the burden of proof to establish your guilt beyond a reasonable doubt), what reason would you ever have to testify against your friend?

Absolutely none.  Being innocent gives you the power to tell the authorities to go away.  (I'm being polite.)

Being guilty -- in one's heart of hearts -- subjects you to feeling immense pressure.  It gives the government leverage over you, and I believe that is the case here, that the government "has the goods" on Pettitte and thus can pressure him to sing their song.

Should Pettitte testify at Clemens' trial, any such deal with the government for immunity from prosecution, and the allegedly crimnal acts (if any) Pettittee would have to admit to having committed, will be revealed at trial. 

The issue of whether any of these acts -- whether it's the use or transport of performance-enhancing substances or other transgressions -- should rightfully be considered criminal by the government is another story altogether.  I'll refer readers to the excellent 2009 Harvey Silverglate book, "Three Felonies a Day."

Eric Dixon is a New York lawyer who handles investigative matters, litigation stress counseling, sensitive legal matters and crisis management for individual, business and political clients.  He may be reached at and by phone at 917-696-2442.(  

Wednesday, February 2, 2011

The Fall of the Foreclosure Mill King

A Florida lawyer who founded a notorious foreclosure mill is proving to have been a bad investment for investors in an affiliated back-office business, according to this report

The somewhat eponymous DJSP Enterprises was a publicly-traded, and SEC reporting, company for a brief time after "going public" in 2008 as a special purpose acquisition company ("SPAC").  SPACs have come under significant regulatory scrutiny in past years.


Bernard Madoff: Mr. Met

Disgraced amalek financier Bernard Madoff and the New York Mets baseball club apparently had strong ties, according to this embarrassing -- no, damning -- New York Times report in Wednesday's editions.

Crime, Politics and Policy has previously predicted that the Mets will eventually seek bankruptcy protection in the wake of the revelation of the Madoff fraud, the Mets' owners' large exposure to losses and a lawsuit (still under seal by the Manhattan federal district court) filed by Madoff bankruptcy estate trustee Irving Picard reportedly for $1 billion.  As more details and allegations emerge, it becomes likelier that the Mets may already be insolvent, and that the Wilpon family will need to consider divesting of the entire franchise in what could even become a distressed sale situation. 

Eric Dixon is a New York lawyer who handles investigative matters, legal matters, strategic analysis and crisis management for businesses, individuals and political organizations.  Mr. Dixon has previous, substantial experience as a lawyer handling corporate transactions.  Mr. Dixon can be reached for consultation or comment at 917-696-2442 and