UPDATE: Madoff Seeks 12-Year Sentence For Ponzi Scheme Fraud
24 June 2009 - 1:48AM
Dow Jones News
Bernard Madoff asked a federal judge on Tuesday to sentence him
to as little as 12 years in prison after he pleaded guilty earlier
this year to operating a massive, decades-long Ponzi scheme.
In a letter filed late Monday and made public Tuesday, Ira
Sorkin, a lawyer for Madoff, asked U.S. District Judge Denny Chin
to sentence his client to less than a life sentence.
"Mr. Madoff is currently 71 years old and has an approximate
life expectancy of 13 years," Sorkin said. "A prison term of 12
years - just short of an effective life sentence - will
sufficiently address the goals of deterrence, protecting the public
and promoting respect for the law without being 'greater than
necessary' to achieve them."
Sentencing is set for June 29.
In the alternative, Sorkin said a sentence of 15 years to 20
years would effectively achieve those goals. "Indeed, such a range
will appropriately eliminate concerns for disparate treatment among
similarly situated non-violent offenders," Sorkin said.
Sorkin noted that the average sentence between 1999 and 2008 was
184 months in prison, or a little more than 15 years, for
fraud-related cases in which a defendant was facing life in prison
under federal sentencing guidelines.
In several recent high-profile fraud cases involving top
executives in federal court in New York, the sentences have ranged
from 12 years in prison to 25 years in prison.
Adelphia Communications Corp. (ADELQ) founder John Rigas,
convicted of fraud and other charges in 2004, is serving a 12-year
sentence after initially being sentenced to 15 years in prison.
Former WorldCom Inc. Chief Executive Bernard J. Ebbers,
convicted of fraud and other charges in 2005, is serving a 25-year
sentence; ex-hedge fund executive Samuel Israel III, who pleaded
guilty to fraud and other charges in 2005, is serving a 20-year
sentence.; and Refco Inc.'s (RFX) former Chief Executive Phillip R.
Bennett, who pleaded guilty to a 20-count indictment in 2008, is
serving a 16-year sentence.
Anthony Sabino, a professor of law and business at St. John's
University, said he expects Judge Chin to sentence Madoff to a
minimum of 20 years in prison, if not 25 years in prison.
He said the Madoff case is "unprecedented" because of the
universe of people affected and can't be compared with other recent
corporate frauds, such as the Rigas or Ebbers cases.
"The sentence will be of such a duration that Bernie Madoff will
spend the rest of his life behind bars," Sabino said.
A spokeswoman for the U.S. Attorney's office in Manhattan, which
brought the case, declined comment Tuesday.
Prosecutors are expected to file their recommendation for
sentencing on Friday.
On March 12, Madoff was ordered directly to jail after he
pleaded guilty to 11 criminal counts in connection with a
decades-long Ponzi scheme that bilked thousands of investors out of
billions of dollars. The scheme came to light in December.
The statutory maximum in the case is 150 years in prison.
In his letter, Sorkin said Madoff will speak to "the shame he
has felt and to the pain he has caused" and Madoff and his lawyer
will acknowledge the scope and magnitude of the loss.
"We seek neither mercy nor sympathy," Sorkin said.
"Respectfully, we seek the justice and objectivity that have been -
and we hope always will be - the bedrock of our criminal justice
system."
In court documents filed last Friday, prosecutors said the
court-appointed trustee for Madoff's firm - Bernard L. Madoff
Investment Securities LLC - has identified about 1,341 account
holders at Madoff's firm who suffered estimated losses of more than
$13 billion as of Dec. 11, the day he was arrested.
Madoff claimed to have nearly $65 billion in his firm's account
as of the end of November, but the accounts held a small fraction
of that, prosecutors have said.
In his letter, Sorkin notes that Madoff has entered into
agreements with the U.S. Attorney's office to transfer or liquidate
assets for the benefit of victims, including agreeing to the
seizure of property in order to preserve assets for victims.
Sorkin also called on the judge to avoid a mob mentality that
has been forming in connection with sentencing, noting the anger
and resentment in statements by victims "is no doubt justified in
light of the circumstances of this case."
"Thankfully, none of the fury expressed in the victim statements
has been as shocking as the death threats and anti-Semitic emails
that have been directed toward Mr. Madoff and his counsel," Sorkin
said. "Nevertheless, we believe that the unified tone of the victim
statements suggests a desire for a type of mob vengeance that, if
countenanced here, would negate and render meaningless the role of
the court. Instead, we respectfully submit that it is the duty of
the court to set aside the emotion and hysteria attendant to this
case and render a sentence that is just and proportionate to the
conduct at issue."
-By Chad Bray, Dow Jones Newswires; 212-227-2017;
chad.bray@dowjones.com