One of Preet Bharara's final acts as U.S. attorney for the Southern District of New York was telling a federal judge that his office had recused itself from a criminal investigation involving unauthorized leaks by the government to the press about insider trading investigations.
In a letter dated Saturday, March 11, 2017 — the day Mr. Bharara was fired — lawyers for the government responded to an order by Judge P. Kevin Castel. Judge Castel had required a written status update on the status of "all investigations and proceedings" against an FBI supervisory special agent, David Chaves, "or any other person making or concealing unauthorized disclosures related to insider trading investigations."
"On February 9, 2017, the United States attorney's office for the Southern District of New York (the "Office") was formally recused from the investigation of Special Agent Chaves, under Department of Justice procedures," the March 11 filing, submitted over Mr. Bharara's name, said. The letter did not specify what "procedures" required the recusal, or who had requested the recusal.
Instead of being handled by the Southern District, the investigation is being handled by Washington-based federal prosecutors who specialize in corruption by government officials.
The New York-based prosecutors asked that the Washington-based prosecutors be allowed to brief the judge under seal on the grounds that "the criminal investigation remains active, and public disclosures about the investigation could hinder it." This is somewhat ironic, because it is public disclosures about an ongoing, or stalled, criminal investigation involving William "Billy" Walters that got this investigation rolling in the first place. But Judge Castel required that a redacted version of the update be made public.
That was done on March 16, with the public filing of a letter to the judge by Raymond Hulser, the chief of the public integrity section of the criminal division of the U.S. Department of Justice in Washington. Some of the letter was blacked out, but some was not.
"Because it is handling the Walters prosecution, the U.S. Attorney's office has been recused from this investigation, and the matter has been assigned to the Public Integrity Section of the Department of Justice's Criminal Division," the letter said.
The letter said that in January 2017, the Public Integrity Section opened a "criminal investigation into the leak of sensitive law enforcement information in connection with the investigation that led to the Walters case. To the extent that the investigation uncovers evidence of a criminal violation in connection with any related leaks, we will investigate those as well."
There are two trial attorneys assigned to the leak investigation. Jonathan Kravis clerked for both Judge Merrick Garland and Justice Stephen Breyer and, as a Yale Law student was reportedly the hero of a 2004 touch football game between the Yale Law Journal and the Harvard Law Review. Nicholas Connor is a 2009 graduate of New York University law school.
Earlier coverage of this story for context and background is here, here, and here.
