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March 11, 2009

"Where's the Bone for Bernie Madoff?"

The title of this post is the title of this query by Jeralyn at TalkLeft.  The question reflects my own reaction when I hear that Madoff will be pleading guilty without the benefit of a plea agreement.  Here is part of Jeralyn's analysis:

[Madoff's lawyers have indicated he will plead] straight up to all 11 counts against him and receives no sentencing concession, no promises about non-prosecution of family members and no agreement that the Government's continuing investigation won't affect his wife and other family members' assets.

He's 70 years old. Even if he gets a 25 year sentence with good time, he's likely to die in prison. He's not going to a minimum security camp. So why is he pleading guilty? Are there secret agreements we don't know about?...

[W]ho agrees to start a life sentence at 70, when you can have another year or two at your luxurious Park Avenue abode in the company of your spouse and family, while awaiting trial?

It's not like the Government could give him any more time if he went to trial and lost.  What was he afraid of?  That he'd be sentenced to life plus cancer?

I don't get it.  I know he has smart, expensive, white collar lawyers, but who pleads a client to life in prison without a plea agreement, without concessions to family regarding their retention of assets or an agreement not to prosecute them?

I've uploaded the documents for those who want to read them:

There's got to be a bone for Bernie in here somewhere, but right now, I'm not seeing it.

Among the comments at TalkLeft are suggestions that, had Madoff done to trial or even forced the prosecution to start going forward more formally, more details of the fraud would have emerged to show that family and others were deeply involved in his fraudulent actions.  That theory makes sense to me, though I still find the lack of any kind of formal plea agreement to be surprising and notable in this case.

Some related Madoff posts:

March 11, 2009 at 03:12 PM | Permalink


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Madoff doesn't have a whole lot to bargain with.

His crime is sufficiently blatant (he didn't even attempt to trade stock with the money received, making it the purest of all Ponzi schemes as a paper trail would show), that he is certain to be convicted of something, and indeed, if prosecutors pushed it, one count of something per investor.

As noted, any sentence recommended by the sentencing guidelines, even with significant reductions, would probably leave him in prison for life. Minimum security probably is where he is headed -- penologically, a 70 year old who pleaded guilty and worked his whole life on Wall Street is a threat to no one. Of course, while in prison, he will be in no position to enjoy any of the money he might be able to retain, either way.

So, what is he sacrificing? A year or two of freedom pending trial.

What does he get? My guess is that the feds insisted that any plea bargain include cooperation in going after co-conspirators. If he pleas guilty, he retains husband-wife privilege and can also be as uncooperative as he wishes with impunity. What are they going to do? Find him in contempt and hold him in jail when he says "I don't remember" on the stand? Fine him, after his entire personal estate has been forfeited already?

By not cooperating at all, he may delay the process of causing the dots to be connected with regard to co-conspirators enough to run the fraudulent transfer statute of limitation saving some of his money.

I also wouldn't be surprised if he committed suicide shortly before his report to prison date, rendering the judgment for restitution against him void, and further postponing the process.

Posted by: ohwilleke | Mar 11, 2009 4:03:13 PM

As strange as it may seem, I believe that at least part of Bernard Madoff's strategy in making a "blind guilty plea" to the Court without any Plea Agreement with the Government is to try to avoid a life sentence, by obtaining a 3 point credit to his Guidelines sentence calculation for timely acceptance of responsibility, pursuant to U.S.S.G. section 3E1.1(a)&(e). This strategy appears previously to have succeeded in the Southern District of New York. See, United States v. Teyer, 322 F.Supp.2d 359, 365-373 (S.D.N.Y. 2004) (Gerard E. Lynch, J.) [Torres receives a sentence of 456 months in prison instead of life, despite DOJ's arguments that defendant should not receive credit for his acceptance of responsibilty, where he made a blind guilty plea to the Court without a Plea Agreement or any agreement to debrief and cooperate with DOJ], affirmed following remand, United States v. Torres Teyer, 2006 WL 3511885 (S.D.N.Y. 12/6/06). If, following his initial sentencing, Madoff cooperates and provides testimony or evidence against others, he may do so only pursuant to the Government's agreement to file a Motion to Reduce his Sentence, as provided in U.S.S.G. section 5K1 and Title 18 of the U.S.Code. While Bernard Madoff will inevitably end up with a very long sentence (particularly for a 70 year old man), avoiding the life sentence may leave some future room for Mr. Madoff eventually to be released from prison before he dies, if parole is ever reinstated in the Federal system, or if Mr. Madoff ever qualifies for a Compassionate Release by the B.O.P. due to severe health problems or a terminal illness. What do you think of this idea?

Posted by: Jim Gormley | Mar 11, 2009 4:03:31 PM

It is possible that his lawyers believe that they have some incredible mitigation arguments to make at sentencing which may have been foreclosed by a plea agreement. If the government was pushing an agreement which prohibited any argument for a sentence below the advisory guidelines range, he could see it as some sort of benefit (the advisory range will be life, regardless of whether he gets the 3-points for acceptance or not).

Politically, I can't imagine the US Attorney not following through on investigations of the family due to some "secret agreement." The newspapers in NYC are calling for blood.

Or, he may just want to go down in a blaze of glory to get that last bit of attention and awe.

Posted by: NYC Lawyer | Mar 11, 2009 5:24:05 PM

Technically, I don't think Madoff can get a "life" sentence, as all the charges against him have a statutory maximum term of years. The max totals 150 years and would practically be a "life" sentence, but technically it have to be a definite term of months.

The Guidelines topping out at "life" can't trump the aggregated statutory maximums.

Posted by: JDB | Mar 11, 2009 5:26:37 PM

Mr. Gormley, 456 months in prison is 38 years. I don't think very many people live that long in prison, even if they're put away at a relatively young age.

Posted by: ab | Mar 11, 2009 5:38:04 PM

Dear a. b.: While Bernie Madhoff certainly won't have an opportunity to survive 38 years in Federal prison (unless God choses to extend his normal life expectancy), some people do actually live that long in Federal prison. When I was an inmate at U.S. Penitnetiary, Coleman, Florida in September 2006, I prepared an "Application for Compassionate Release" for a terminally ill (cancer) inmate who had been in federal prison since June 1964, 41 years. His crimes were: 1) kidnapping resulting in death (paroleable life sentence under the "Old Law") and 2) armed bank robbery. Mr. Torres Treyer was only 35 years old when kidnapped by the D.E.A. from belize and brought to New York. He plays soccer in prison and works out, so I am confident that he will live out his 38 year sentence, unless he is killed in prison violence. For Bernie Madoff, I think "water boarding" would be an approriate sentence, but it is unlikely that the Second Circuit would go along. See, "www.bernard-madoff-scam.blogspot.com".

Posted by: Jim Gormley | Mar 12, 2009 1:03:35 PM

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