In what will likely become the biggest investment fraud in US history, Bernie Madoff is set to enter a plea of guilty at a US District Court in Manhattan on Thursday. According to Assistant U.S. Attorneys Marc Litt and Lisa Baroni a plea hearing is scheduled for March 12, 2009.
According to a CNN report:
Madoff’s attorneys Ira Sorkin and Daniel Horowitz confirmed to CNN that Madoff is waiving his right to a grand jury indictment and that there have been ongoing negotiations regarding a possible settlement.
“We obviously have talked to the government,” said Horowitz. “And we have been professional with each other.” The U.S. attorney’s office in Manhattan had no comment.
Frankly, it would make sense that Madoff would enter a plea. Anything beyond that would likely result in a sentence or punishment that would be less favorable to Madoff. Let me, however, say, I don’t think the punishment will be anything to laugh at. Madoff’s alleged crime is substantial enough that it will earn him many years in federal prison. Based on his age, I have stated on more than one ocassion that Madoff may never see freedom again. But, that is just speculation.
As many of my readers know, I have been through what Madoff is facing now. Here’s a reality check – if you fight the federal government, you will likely end up with a substantially longer sentence. The government (for the most part) will do whatever is necessary to gain a “win”! The governments role is not to make the victims whole or even to discover who or how many people have been victimized. The role of the government is to bring those who break the law to justice. And the easier you make it for them to “win” the more likely one is to receive a moderate to light sentence.
Now, having said that, I also know that there are victims who get angry when they discover that the government doesn’t really care about their loss or their plight. If a victim can help the government win, then the government is interested. But, when the US Attorney has sufficient evidence to win or gets an admission of guilt on a plea agreement (which is exactly what Madoff – through his attorneys – will enter on Thursday) they are done. The rest of victims claim will come in other legal suits that will be brought against a multitude of organizations.
In Madoff’s case – gaining a guilty plea should be easy since Madoff basically admitted guilty publically. CNN reported:
It was “basically, a giant Ponzi scheme,” Madoff said, according to the government’s criminal complaint. “There is no innocent explanation,” Madoff told two FBI agents, according to the complaint, which states Madoff expected to go to jail.
With a statement like that – it’s an easy win for the goverment. The issue in the plea agreement is not guilt, but what Madoff will plead guilty to and what sentence has basically been agreed to in advance. The government will get it’s win, but will the sentence be sufficient to satisfy the victims? By the way, starting at 10:00 a.m. victims will have a chance to be heard by the judge. Not that it matters all that much as I would guess that it’s pretty well decided.
Having been through it, (wish I could say other wise) the process will likely be fairly straight forward. Madoff pleads guilty to “securities fraud”. The judge hears from the victims. The judge accepts Madoff’s guilty plea.
Hum…now that’s a good question. Thus far Madoff has been under – shall we call it – “house arrest.” Whether he’ll be allowed to continue that form of confinement or whether the judge will require him remanded to some form of federal prison awaiting sentencing remains to be seen. Certainly this is public outcry for Madoff to be imprisoned.
There is little chance that Madoff will be sentenced on Thursday. If this hearing is true to form, it will only be an admission of guilty. Once entered and accepted, Madoff will have more time to wait until his sentencing hearning. In my case I had to wait almost six months before being sentenced and then another four months before being required to report to federal prison.
I doubt it will take that long for Madoff, but it will likely take time.
According to the New York Times:
If Mr. Madoff does plead guilty on Thursday, it could nevertheless be several months before he is sentenced, several former prosecutors said. The single count of securities fraud that he faces now carries a prison term of up to 20 years.
The one thing I do find interesting in this case if that the government is only seeking an admission of guilt on ONE count of securities fraud. With so many victims, it would seem that the government could easily win multiple admissions of guilt on items other than just ONE count of securities fraud. It makes one wonder if the government isn’t being cooperative due to the backlash that could come if Madoff exposed the incompetence of the SEC?
Just a thought!
1. Assuming Madoff Pleads guilty – how much time do you feel he should serve for his crime?
2. Should Madoff’s sentence be reduced if he helps locate available funds to help with restitution?
3. Should charitable organizations get preferential treatment when it comes to restitution?
YOUR COMMENTS ARE WELCOME!