Prominent hip-hop agent charged with money laundering

By Christine Duhaime | July 12th, 2011

James Rosemond, also known as Jimmy Henchman, a well-known hip-hop talent manager for several singers, including Sean Kingston and The Game, was charged at the beginning of July by the U.S. Department of Justice, Eastern District of New York, on money laundering and other charges in a thirteen-count superseding indictment based on allegations that Rosemond used his music business, Czar Enterprises, as a front for a criminal enterprise that trafficked cocaine. In addition to the charges, the U.S. Attorney’s office is arguing for the disqualification of Rosemond’s lawyer.

Money Laundering Charges

The indictment alleges that Rosemond laundered proceeds from the cocaine operation, engaged in unlawful monetary transactions and structured financial transactions to evade anti-money laundering reporting requirements. One of Rosemond’s money laundering techniques allgedly involved converting the cash proceeds into postal money orders and structuring those orders to avoid generating a report that would tie him to the money orders. There are apparently over 1,200 money orders totalling over US$1 million, the proceeds of which were allegedly used by Rosemond for various purposes, including payment of legal fees.

The U.S. Assistant Attorney’s Office has said that it has evidence esatblishing the criminal enterprise that includes statements from numerous confidential sources and witnesses who were part of Rosemond’s enterprise; recorded telephone calls, e-mails and text messages between Rosemond and his colleagues; and parcels containing large amounts of cocaine and narcotics proceeds.

Disqualification of Rosemond’s Lawyer

The U.S. Attorney has taken the position that Rosemond’s lawyer suffers from numerous actual and potential conflicts of interest in his representation of Rosemond that disqualifies him from acting because, among other things, his relationship to the events in question makes him a witness.

The law with respect to the disqualification of counsel in instances of conflict is fairly settled in the Unites States. Courts have the power and the duty to disqualify counsel where the public interest in maintaining the integrity of the judicial system outweighs a client’s constitutional right to counsel. In United States v. Cunningham, 672 F.2d 1064, 1074 (2d Cir. 1982), the Second Circuit Court held that:

“If a lawyer is both counsel and witness, he becomes more easily impeachable for interest and thus may be a less effective witness. Conversely, the opposing counsel may be handicapped in challenging the credibility of the lawyer when the lawyer also appears as an advocate in the case. An adocate who becomes a witness is in the unseemly and ineffective position of arguing his own credibility.”

A lawyer in that position also becomes an unsworn witness at trail, and is thereby disqualified from acting as counsel (see Unites States v. Locascio, 6 F. 3d; Ciak v. United States, 59F 3d 296). In United States v. McKeon, 738 F.2d 26, the Court explained:

“When an attorney is an unsworn witness, the detriment is to the government, since the defendant gains an unfair advantage, and to the Court, since the fact-finding process is impaired. Waiver by the defendant is ineffective in curing the impropriety in such situations, since he is not the party prejudiced.”

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