Irish Businessman to be Arraigned In Ireland By U.S. Court for U.S. Crimes

An Irish businessman embroiled in a corporate accounting fraud will make legal history next week when he is brought before an Irish court to answer U.S. federal criminal charges.^[1]

On Monday, Oct. 1, a U.S. Federal judge will arraign Jerry Shanahan live via international satellite video from the Four Courts in Dublin.^[2] It is the first time an Irish citizen has ever been arraigned in Ireland by a judge sitting in a foreign court.^[3]

Jerry Shanahan, the a former chief operations officer with Enterasys Networks, has already voluntarily stood trial in New Hampshire on six charges of conspiracy, wire and mail fraud.^[4]

Earlier this year he was acquitted on one count and a mistrial declared after a hung jury on the five remaining counts.^[5] It later emerged that all but one juror wanted to acquit the Irish national on all charges, but the jury later became deadlocked after finding his four co-defendants guilty of fraud.^[6]

Most of the time a federal defendant would be extradited to the U.S. for their trial, however Mr. Shanahan has waived his extradition rights in an attempt to clear his name.^[7]The Irish Embassy in Washington DC and David Barry, the Irish Consulate General in Boston, are monitoring the proceedings and have been liaising with their American counterparts about the case.^[8]

Accounting Fraud
Accounting Fraud is covered under 18 USC § 1520, wherein it states that 1) Any accountant who conducts an audit of an issuer of securities to which section 10A(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78j–1 (a)) applies, shall maintain all audit or review workpapers for a period of 5 years from the end of the fiscal period in which the audit or review was concluded.^[9] 2) The Securities and Exchange Commission shall promulgate, within 180 days, after adequate notice and an opportunity for comment, such rules and regulations, as are reasonably necessary, relating to the retention of relevant records such as workpapers, documents that form the basis of an audit or review, memoranda, correspondence, communications, other documents, and records (including electronic records) which are created, sent, or received in connection with an audit or review and contain conclusions, opinions, analyses, or financial data relating to such an audit or review, which is conducted by any accountant who conducts an audit of an issuer of securities to which section 10A(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78j–1 (a)) applies. The Commission may, from time to time, amend or supplement the rules and regulations that it is required to promulgate under this section, after adequate notice and an opportunity for comment, in order to ensure that such rules and regulations adequately comport with the purposes of this section.^[10]

Whoever knowingly and willfully violates subsection (a)(1), or any rule or regulation promulgated by the Securities and Exchange Commission under subsection (a)(2), shall be fined under this title, imprisoned not more than 10 years, or both.^[11]

Nothing in this section shall be deemed to diminish or relieve any person of any other duty or obligation imposed by Federal or State law or regulation to maintain, or refrain from destroying, any document.^[12]

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^[1] Independent Staff, Irish court to hear US charges, The Independent (Ireland), September 29, 2007, available at http://www.independent.ie/national-news/irish-court-to-hear-us-charges-1092174.html (last visited October 2, 2007).
^[2] Id.
^[3] Id.
^[4] Id.
^[5] Id.
^[6] Id.
^[7] Id.
^[8] Id.
^[9] 18 USC § 1520 (a)(1)(2007).
^[10] Id., at §1520(a)(2).
^[11] Id., at § 1520(b).
^[12] Id., at § 1520(c).