New Sheriff Of ‘Y'all Street' Beefs Up As Finance Heads To Texas

For generations, the most consequential Wall Street cases have tended to lead to the same place—the federal courthouse in Manhattan. The U.S. Attorney’s Office for the Southern District of New York, sometimes called the Sovereign District for its independent streak, built its reputation prosecuting insider traders, corporate cheats, mob bosses, and corrupt politicians. Its jurisdiction, which includes Wall Street, made it the country’s preeminent financial industry cop, even when the conduct stretched far beyond New York. Now, as financial firms move operations south, the top federal attorney in Dallas wants Texas to become a center for white-collar prosecutions. Ryan Raybould, the U.S. Attorney for the Northern District of Texas, says he is creating the first dedicated securities-fraud unit in the office’s history, modeling the section on operations in New York and Los Angeles as banks, investment firms and exchanges expand their presence in Dallas. “With the launch of Y’all Street, we are going to have to be thoughtful regulators for all markets,” Raybould, 43, said in an interview. “We have to be the regulators of our own markets.” He said it was “absurd” that a company in Dallas or Fort Worth should be policed principally from New York. Raybould was nominated by President Donald Trump last year and confirmed by the U.S. Senate in May. Although he’s been on the job for months, he’s set to be formally sworn in on Thursday and his tenure will continue to play out in a highly politicized moment with the Justice Department focused on Trump administration priorities such as immigration enforcement. Changes at the department have rippled through U.S. attorneys offices across the country, leading to waves of exits. “I lost 50 AUSAs when I came into this role,” he said, referring to assistant U.S. attorneys. “I’ve hired 45.” The office now has about 115 prosecutors and is nearly fully staffed even as other U.S. attorney's offices have struggled to replenish their ranks. “We’re going to build the plane as it’s flying,” Raybould said. Raybould says he’s embracing the administration’s focus on drug cartels, pairing that priority with his background as a fraud prosecutor. Setting local enforcement priorities is “what President Trump trusted” U.S. attorneys to do, he said. The financial geography of Texas is dramatically changed after a yearslong effort by Texas Governor Greg Abbott and other Texas Republicans to court the financial industry. Goldman Sachs Group Inc. is building a $500 million campus near downtown Dallas. JPMorgan Chase & Co. has opened a regional headquarters. Bank of America is anchoring a new tower, while Morgan Stanley is weighing a $1.3 billion skyscraper in Uptown. Meanwhile, the Texas Stock Exchange, backed by institutions including Citadel Securities and JPMorgan, has begun trading and logged its first primary listings when Texas Capital Bancshares moved two exchange-traded funds south from the New York Stock Exchange’s Arca venue. The NYSE established its own Texas operation at Old Parkland, the Dallas campus favored by family offices, and Nasdaq has shifted a venue to the state. Other parts of Texas are also poised to add finance jobs. Apollo Global Management Inc. announced in August that it picked Austin as the site of a new U.S. hub for focused on innovation and emerging technology. “The emergence of experienced prosecutors capable of addressing federal securities violations in Texas is a natural extension of the state’s growing role in the financial system,” said Chelsea Hilliard, a lawyer at Dorsey & Whitney in Dallas. James Spindler, a securities law professor at the University of Texas at Austin, said that few U.S. Attorneys have built teams dedicated to financial crimes because the Securities and Exchange Commission has more resources in regional offices and prosecutors tend to focus on cases that are a “slam dunk.’’ The SEC has a regional office in Fort Worth. Raybould looks the part of a Texas prosecutor, his blue suit accompanied by black cowboy boots. Raised in the Kansas City area, he graduated from Yale, where he was captain of the school’s soccer team. He played professional soccer for a few seasons on his hometown Kansas City Wizards, but after a year on a team in Sweden, he called it quits and fell back on getting a law degree at Notre Dame. He eventually came to Texas, clerking for Chief U.S. District Judge Reed O’Connor before joining the Justice Department. After stints in the Tax Division and the U.S. Attorney’s Office in Middle Tennessee, he returned to North Texas in 2018 as a prosecutor in the criminal division, eventually becoming deputy chief of the office’s white-collar and public-corruption unit. His case load included securities and tax fraud, money laundering, cybercrime, public corruption and national-security cases. Raybould left the Justice Department to become chief counsel to Senator John Cornyn, advising the Texas Republican on the Judiciary Committee and helping draft legislation involving national security, government accountability and drug diversion. He later joined Kirkland & Ellis as a partner in its government, regulatory and internal investigations practice. He might not be the best known Raybould in the family. His wife, Brooke Raybould, is a social media influencer with more than 1.2 million followers on Instagram. Raybould makes occasional cameos on the account as his wife describes raising their five sons. The Northern Texas federal prosecutor’s jurisdiction spans 100 counties, stretching from the increasingly wealthy Dallas-Fort Worth region into small towns where Raybould said fraud can devastate people with little connection to Wall Street. Raybould said prosecutors should distinguish between criminal prosecutions and problems that can be addressed another way. “We’re not just looking for nails,” Raybould said. We should “use scalpels when appropriate.” Raybould declined to discuss specific investigations, but said disagreements over how to handle cases touching both Dallas and New York would be sorted through the Justice Department by weighing factors like which office began the investigation and did the most work. If the offices can’t agree, U.S. Attorney General Todd Blanche would ultimately decide. “It’s very collegial,” Raybould said. “It’s ultimately, like, what’s best for the case.” This article was provided by Bloomberg News.