Saturday, January 10, 2015


If you were looking for an indication of how serious the US Government is about Ponzi schemes, this week's unusual post-judgment developments regarding the other defendants in the Bernard Madoff cases should confirm that it is looking to make additional points to the public, beyond Madoff's extremely long sentence. The US Attorney's Office in Manhattan has filed notices that it is appealing the sentences of five of the Madoff defendants.

Government appeals of sentences do not occur often, probably because prosecutors are usually satisfied with the severity of the specific sentences handed down by the District Judges, or that they are within the calculated Guidelines range. But since these prosecutors will be appearing, again and again, before any judge whose sentence they decide to appeal, they had better have grounds, as specified in the statute, before they take that step. I note that the Government, in some cases, asked for twice the prison time that the Court ultimately handed down in the Madoff sentences, and this was a billion dollar case.

I understand that the idea is to send a message to the business community, to deter future offenders, but the reason may be more practical: if the Madoff defendants, in this huge case, do not get a lot of time, lesser defendants' counsel may point to the (relatively) short sentences in other, minor cases, in the future; Perhaps the sentences were too lenient, given the size of the Madoff case, and its effect upon the many individuals who lost everything.   

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