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Across the Nation: FBI settles eavesdropping lawsuit with wife of inside trader

Arkansas judge quits after sex allegations

LITTLE ROCK, Ark. — An Arkansas judge has left office and agreed to never serve on the bench again after a disciplinary panel threatened to administratively charge him with trading sexual favors with female defendants in exchange for their release.

The case marks the second time in a little over a year that an Arkansas judge has faced sexual misconduct accusations.

Carroll County District Court Judge Timothy Parker denied the sexual misconduct charges when he resigned Saturday on the last day of his current term in office, the Judicial Discipline and Disability Commission said Tuesday. The panel said Parker admitted to releasing and lowering bail for defendants who were friends or former clients and, in some cases, giving rides to defendants in his own vehicle after he released them.

Parker, who was appointed to the judgeship in 2013, also faces a criminal investigation over the accusations. Jason Barrett, a special prosecutor appointed to investigate the case, said Tuesday that he was reviewing JDDC’s evidence to see if charges were warranted.

The panel said it had video statements from more than a dozen women, recordings of conversations Parker had in jail with women, as well as text messages that back up the allegations. The allegations were outlined in a letter, made public Tuesday, that the board sent to Parker.

“Bonds would be set, or release of the women on their own recognizance was ordered by going to the jail or via telephone. The bonds or release of these women or their family or friends were done by their request in exchange for sexual favors,” David Sachar, the panel’s executive director, said in the letter dated Saturday.

Parker denied the sexual favor allegations when contacted by The Associated Press Tuesday. Asked why he didn’t contest the allegations before the panel, he responded: “I have young children and I don’t want them exposed to that kind of crap.”

His resignation comes just months after another former Arkansas judge was charged with giving lighter sentences to defendants in exchange for sexual favors. Former Cross County District Court Judge Joseph Boeckmann was indicted in October on several federal charges, including wire fraud and witness tampering.

Boeckmann resigned in May after a JDDC investigation. The commission’s investigators found thousands of photos on Boeckmann’s home computers of naked and semi-naked men, many of whom were identified by the commission as former defendants whose cases had gone before Boeckmann both as a judge and as a deputy prosecutor.

 

FBI settles eavesdropping lawsuit with wife of inside trader

NEW YORK – The wife of a convicted inside trader has chalked up a rare win over the FBI, with the agency agreeing to settle a lawsuit that claimed agents eavesdropped on her intimate conversations with her husband.

Arlene Villamia Drimal, wife of former Galleon Group LLC trader Craig Drimal, sued 16 FBI agents, claiming they “wrongfully intercepted” more than 180 private calls between her and her husband during the investigation. Terms of the settlement weren’t made public.

The Federal Bureau of Investigation doesn’t usually settle such lawsuits, but the bureau is coming under increasing scrutiny in white-collar crime probes. The settlement with Villamia Drimal comes as an FBI agent potentially faces criminal charges for leaking details of another insider-trading investigation to the New York Times and Wall Street Journal. In that case, Las Vegas gambler Billy Walters is attempting to have insider-trading charges thrown out because of the leaks.

Soon after a judge refused in July to throw out all of Villamia Drimal’s claims, settlement talks began, the two sides said in a joint court filing.

Villamia Drimal sued in 2012 the current and former agents who tapped her husband’s phone during an investigation that also brought down Galleon Group co-founder Raj Rajaratnam.

Villamia Drimal claimed the agents were required to stop listening once it became apparent the calls were between husband and wife. Such conversations are considered confidential and can’t be used in court.

The agents listened in anyway. The U.S. Attorney in New York later characterized one such incident as “indefensible,” Villamia Drimal said in her complaint. She didn’t make the content of the calls public, other than to say that many “involved deeply personal and intimate issues.”

A judge in 2011 said he was “deeply troubled” by the agency’s failure to stop listening to unrelated, personal calls.

A federal appeals court threw out Villamia Drimal’s lawsuit in May, but said it could go forward if it focused on fewer agents. The judge overseeing the case then allowed some claims to proceed against three of the defendants. The settlement was disclosed in a Dec. 5 court filing.

Craig Drimal was sentenced to 5 1/2 years in prison in 2011 after pleading guilty to making $6.47 million from trading on inside information obtained from lawyers working on transactions involving 3Com Corp. and Axcan Pharma Inc. He was released from prison in September.

Walters was charged in May with trading shares of Dean Foods Co. based on inside tips from Thomas Davis, the company’s former chairman, who pleaded guilty and is cooperating with investigators. Walters pleaded not guilty. Golfer Phil Mickelson, who was also investigated by the FBI, reached an agreement with the SEC to return proceeds of almost $1 million. He wasn’t accused of wrongdoing.

Rajaratnam was convicted in 2011 of 14 counts of conspiracy and securities fraud after a trial in 2011. He’s serving an 11-year prison sentence.

 

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