Departing U.S. Attorney Anne Tompkins is joining a legal firm linked to one of her biggest cases – the lawsuit against Bank of America over soured mortgage bonds.
Tompkins, the top federal prosecutor in western North Carolina since 2010, will be joining the Charlotte office of Cadwalader, Wickersham & Taft, a Wall Street firm that specializes in financial, securities and corporate law, sources tell the Observer.
Cadwalader’s 40-plus local attorneys operate out of the Carillon building on West Trade Street, which also houses Tompkins and her staff.
Such moves are both common and potentially controversial for prosecutors at Tompkins’ level. A formal announcement of her new duties is expected after Tompkins leaves the Justice Department on March 9.
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Tompkins’ office declined comment, citing Justice Department rules that prohibit employees from discussing new jobs while still on the government payroll. Kara Fitzsimmons, Cadwalader’s director of communications in New York, declined comment.
Tompkins, 52, will be starting her second stint in corporate law during a 22-year legal career mostly in public service. She’s spent time as a Mecklenburg and federal prosecutor and on special deployment to investigate Iraqi war crimes in 2004.
Tompkins also spent five years with the Charlotte office of Alston & Bird, leading up to her nomination and confirmation as U.S. attorney almost five years ago.
In Cadwalader, she joins one of Wall Street’s oldest firms, founded in 1792. The group opened a Charlotte office in 1996. Cadwalader’s footprint extends not only to New York, Washington and Houston, but London, Brussels, Beijing and Hong Kong as well.
Cadwalader partner Kenneth Wainstein, who like Tompkins is a former federal prosecutor, also ran the investigation into the grading scandal at UNC-Chapel Hill.
The geographic closeness of Tompkins’ current and future offices underscores the professional ties that government prosecutors and regulators often develop with groups they directly or indirectly oversee.
Cadwalader played a role in a Bank of America bond offering that later was the subject of a lawsuit Tompkins brought against the Charlotte-based bank.
In August 2013, Tompkins’ office sued the bank, alleging it misled investors about the “quality and safety” of an $850 million mortgage-backed securities offering the bank sold in 2008. As a result, investors bought securities “significantly riskier” than represented by the offering documents, according to the suit. Cadwalader was not a target of the suit.
According to the offering document, Cadwalader provided an opinion on the federal tax consequences on “the purchase, ownership and disposition” of the securities.
Last August, Bank of America reached a $16.65 billion settlement with the U.S. government that resolved claims related to mortgage-backed securities, including the case filed by Tompkins.
“Today’s settlement attests to the fact that fraud pervaded every level of the RMBS industry, including purportedly prime securities, which formed the basis of our filed complaint,” Tompkins said at the the time. “Even reputable institutions like Bank of America caved to the pernicious forces of greed and cut corners, putting profits ahead of their customers.”
Yet, despite a series of similar federal lawsuits tied to the collapse of the economy in 2008, no charges have been brought against top banking officials in Charlotte or anywhere else.
Outgoing Attorney General Eric Holder started a 90-day clock for his prosecutors about a week ago to determine if any cases will be brought against Wall Street’s top executives.
Tompkins has said in the past that her office did not go easy on anyone.
“When something bad happens, there is not always proof of criminal intent,” she told the Observer last year. “We look hard at fraud, and we bring the cases we can bring.”
Tompkins reenters private practice with a highly desired resume, experts say.
“Demand for white-collar partners with securities enforcement experience in a government agency is probably as high as it’s been for a long time. And there’s a relatively small supply,” Gregory Wallance, special counsel for the New York law firm Kaye Scholer, told the publication Law360.
Tompkins, a budget analyst for the city of Charlotte before becoming a lawyer, made financial fraud a priority during her tenure as U.S. attorney. She created a multi-jurisdictional securities and financial fraud group. Her office also worked closely with Holder in investigating the use of residential mortgage-backed securities, a key factor in the economic collapse seven years ago.
Prosecutors such as Tompkins routinely move back and forth between government jobs and the corporate sector, and many analysts say both groups benefit from the shared experience.
For example, Mark Calloway, who served as U.S. attorney in Charlotte between 1994 and 2001, joined Alston & Bird after he left government service.
But some consumer watchdog groups say the so-called “revolving door” damages public perception. The worst case: “When former public officials lobby the agencies they just left,” said Adam Rappaport, senior counsel for Citizens for Responsibility and Ethics in Washington.
“If (Tompkins) is going into white-collar defense, the revolving door concerns are lessened.”
While the details of Tompkins’ new job are not yet known, she appears headed for a significant pay raise. Her government salary of $157,500 is $20,000 below what her new firm pays even a first-year attorney, according to the online salary guide GlassDoor.com
Cadwalader made more than $481.5 million in revenue in 2014, says American Lawyer, while profits per partner came to $2.2 million. That figure, the magazine says, puts the firm among the top 15 or so in the country. Observer staffer Doug Miller contributed.