Throughout the week over at Securities Docket, I highlight the most interesting columns and blog posts from around the web (on the subjects of SEC enforcement and securities litigation). Here is a digest of my picks for the week ending January 29:

Can the S.E.C. Get the Galleon Wiretaps? (Peter Henning, DealBook)
DealBook | January 28, 2010
The Galleon Group insider trading case is quite unusual in many ways, perhaps most strikingly in the government’s use of wiretaps to record telephone conversations of the defendants while they were apparently exchanging inside information. Those recordings are valuable evidence, and there is a fight going on over whether the Securities and Exchange Commission can force the defendants to give them up.

Odd as it may sound, one arm of the federal government - the S.E.C. - cannot get the wiretaps from another arm - the Department of Justice - with which it is working closely because under federal law the wiretaps can only be disclosed by prosecutors in limited circumstances. Instead, the S.E.C. wants the defendants to provide the recordings, evidence that may well lead to their being found liable for insider trading.

Securities Regulation Institute, Concluded (Matt Kelly, The Big Picture)
The Big Picture | January 28, 2010
Both the Galleon Group case and the recent bribery sting by the Justice Department are an order of magnitude larger than any other enforcement action Corporate America has seen in decades. Where most enforcement actions in white-collar crime have been single arrests of a rogue individual running a scam, these were take-downs of systemic corruption-and compliance officers should take note of that. Not only should you worry about your own company and its suppliers; you should ponder whether corruption exists elsewhere in your industry, and you might get pulled into the orbit of a massive enforcement action even if your company’s compliance isn’t at issue.

Is There an Exit Plan for a Ponzi Scheme? (Did Madoff Have an Exit Plan?) (Christine Hurt, The Conglomerate)
The Conglomerate | January 27, 2010
So what about Bernard Madoff? He’s a smart guy, surely smarter than Carlo Ponzi, who dropped out of the University of Rome and was in and out of prisons most of his early adulthood. Surely he understand the math of the Ponzi scheme — that at some point there aren’t enough people on the earth to keep the finances of the Ponzi scheme going. But Madoff’s fraud was different in some ways that might have bought him more time, allowing his fraud to go on for 15-25 years.

Subprime-Related Section 11 Claim Dismissed (Kevin LaCroix, The D & O Diary)
The D&O Diary | January 26, 2010
While there have been other dismissal motions granted with prejudice in subprime-related securities class actions, the dismissal in ACA Capital Holdings stands out because the ACA plaintiffs’ claims were asserted under the ‘33 Act. Research by Jon Eisenberg of the Skadden law firm regarding subprime dismissal motion rulings shows that all of the cases he studied that only asserted ‘33 Act claims had survived motions to dismiss, in part, he speculates because of the absence of scienter pleading requirements for ‘33 Act claims.

FCPA Undercover (Mike Koehler, FCPA Professor)
FCPA Professor | January 25, 2010
The Africa Sting case is indeed the largest and most dramatic use of pro-active, undercover investigative techniques in an FCPA investigation.

However, contrary to numerous reports and even statements attributed to DOJ officials, the Africa Sting case is not the first time that pro-active, undercover investigative techniques have been used in an FCPA investigation. In other words, this is not a new development.