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U.S. criminal division nominee could counter 'revolving door' criticism

Leslie Caldwell (C), head of the Justice Department's Enron Task Force, arrives at the Federal Courthouse in Houston, where former Enron ass
Leslie Caldwell (C), head of the Justice Department's Enron Task Force, arrives at the Federal Courthouse in Houston, where former Enron ass

By Aruna Viswanatha

WASHINGTON (Reuters) - The Obama administration's pick to serve as the top criminal prosecutor dedicated more of her time in the private sector to defending technology companies than she did financial institutions, a resume that could ease concerns that she might be soft on Wall Street.

Leslie Caldwell, who the White House nominated last month to lead the Justice Department's criminal division, has worked for firms such as Oracle Corp, Cisco Systems and Hewlett Packard as a private lawyer, according to ethics disclosures released by the government.

She has also counseled clients ranging from Toyota's U.S. sales arm and defense contractor Northrop Grumman to romance novelist Danielle Steel, according to a list of recent clients that she has billed for at least $5,000 in one year.

Her client list also includes financial firms Fannie Mae, Morgan Stanley and Deutsche Bank.

Caldwell, who earned $2.8 million since 2012 as a partner at Morgan Lewis & Bockius, did not immediately respond to a request for comment.

The Justice Department has faced criticism for bringing few marquee criminal cases against misconduct that fueled the financial crisis. Attorney General Eric Holder came under fire earlier this year when he said some financial institutions may be too large to prosecute without causing major economic consequences.

Some critics have questioned whether the "revolving door" of lawyers moving between the government and private defense work could hurt the ability of prosecutors to aggressively pursue misconduct in industries they may have previously defended.

Caldwell, who helped build the government's case against the Enron fraud before moving to private practice, could help the Justice Department move beyond that criticism.

"We know that in the most important corporate prosecutions, companies routinely seek and get an audience from the highest levels of the Justice Department," said Brandon Garrett, a corporate crime expert at the University of Virginia law school.

"You want someone that has experience litigating the most complex corporate crime matters, but you also want someone who isn't going to feel conflicts of interest and feel disqualified from decisions in the most important cases," he said.

Some of the criminal division's top priorities include a sprawling inquiry into whether global financial institutions manipulated an array of key benchmarks.

Dutch lender Rabobank agreed on Tuesday to pay more than $1 billion to authorities including the U.S. Justice Department to resolve charges that it manipulated the Libor benchmark interest rate.

The acting head of the criminal division, Mythili Raman, also said on Tuesday that the unit is investigating the possible manipulation of foreign exchange rates. European banks UBS, Deutsche Bank and Barclays disclosed they are cooperating with U.S. and European authorities as part of the probe.

The Senate Judiciary Committee, which would have to vote on Caldwell's nomination before sending it to the full Senate, has not yet scheduled a hearing on her post.

If confirmed, Caldwell would sell her stock in Oracle, General Electric, Bunge, Facebook and EBay Inc, according to her ethics agreement.

(Reporting by Aruna Viswanatha; Editing by Leslie Adler)

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