Bernard Madoff To Plead Guilty to 11 Counts and Face 150 Years in Prison

gavel2Bernard Madoff will plead guilty this week to 11 counts, including money laundering, perjury and securities, mail and wire fraud. He would face 150 years. Prosecutors insist that there is no deal. Indeed, this may be a plea given in the absence of any cognizable defense.

At 70, Madoff is likely to get an effective life sentence regardless of the actual years imposed.

His $50 billion dollar pyramid or Ponzi scheme is now believed to have injured three million people and institutions. The initial proceedings raised an interesting question of a conflict of interest. His lawyer, Ira Sorkin and his family invested more than $900,000 with Madoff. That makes him a potential witness. Indeed, if he did not lose money, his treatment by Madoff and his family could be evidence of disparate treatment given favored parties.

There are two questions outstanding. First, there is the question of whether Judge Denny Chin will order him straight into custody. Normally, when you plead, the court will allow you a few weeks before sentencing to get your matters in order. In this case, the court may find Madoff unworthy of such a gesture. There is also the risk that he might flee or take his life.

Second, there is the Madoff kids. That was the primary concern given the clear guilt and tremendous damage done by Madoff. There is a general view that Madoff lied when he said that his sons did not know and that they turned him in after allegedly confessing to the illegal conduct. The illegality was so extensive, it is hard to believe that his family was in the dark. The question is now whether Madoff’s son and other family members will be charged.

For the full article, click here.

31 thoughts on “Bernard Madoff To Plead Guilty to 11 Counts and Face 150 Years in Prison

  1. Another real question is whether by pleading guilty his family will get off with the money scot free and his victims will still have to pay for his room and board while in jail. Mr. Madoff is still taking us to the cleaners.

  2. The cynic in me believes that Madoff, as befitting his status, will receive a relative light sentence at a Federal Country Prison and be eligible for early parole. I also think that he pleaded guilty to protect his wife and children who were no doubt aware and/or involved. Meanwhile some poor sucker gets 10 years of Texas hard time for possessing an ounce of marijuana.

  3. Mike S:

    An excellent point on the ludicrous sentencing of non-violent minor drug offenses. I’m also curious how NY taxpayers feel about shelling out for all the private protection/surveillance Madoff has received for the months he has been allowed to live in his penthouse. That 24/7 amount of manpower has to cost a pretty penny.

  4. Mike S. and Mojo,

    Those are both excellent points. I’d rather have seen the money spent on a most excellent forensic accountant/PI to go after all the money hidden in various institutions around the world, so investors could be paid back in full. And the disparity in treatment is a monstrous injustice.

  5. The two MSM snippets colliding for me last evening were

    1) a guilty plea means Made-Off need not divulge details about how he made off with the dough AND

    2) Mrs. ‘MO’ in retaining her own Counsel’…

  6. LindyLou,

    I watched that link, thanks for putting it up–interesting (loved the ‘she swallowed her wedding ring!). The other thing to consider is the SEC had ample and explicit warnings/evidence that this was a scam for about 10? years. I don’t know the law, but I would hope the people there who ignored this information might have to cough up some money to the kitty as well!

  7. Mutual Admiration Society aside, being from Boston and part of the ‘inner circle’, so to speak, I was the ‘turlee’ first to post about Harry Markopolos little held doubt given over to the SEC as to Madoff’s operation being nothing more than a ponzi scheme more than ten years ago…

    Jill was just trailing behind moi.

    In a round about way, that is how I know Mario Cuomo, in passing. His former boss, former (D-NY) Governor Hugh Carey gave one of his daughter’s hands in marriage to a very close friend of mine, who owns an investment firm headquartered in Albany with an office in Boston, where we lived and worked in the 80’s and where we still maintain property downtown on the Harbor – along with Harry!

    I also know Hugh Carey through his association with W.R. Grace which I defended and who, years later, coincidentally, offered my now deceased, former, and long since then ex-husband, a position as environmental defense counsel.

  8. Just one of the familys that lost money was being interviewed awhile back,and the lady brought up the point of paying taxes on dividends not realizing that there were none.Sad and interesting at the same time.

  9. THIS is going around the internet and I thought was funny and approriate for this thread:

    Word of the Day – LIQUIDITY

    Definition:

    Liquidity is when you look at your retirement funds and wet your pants.

  10. I’m betting he takes the rap and says nothing to anybody outside about who in the family got what, or where the secret accounts are. He’s a goner either way, so why cost the family?

  11. Hey Patty,

    I do admire Jill because in a lot of ways we’re on the same wavelength but she’s so much more articulate than I am.

    But that doesn’t mean I don’t admire you, too, but just not for the reasons you think. Your background is impressive and is interesting. I’m not very impressed by “insiders” since I have an innate distrust of those.

    One think I admire about you is you ability to come up with a story or article that really captures and expresses something I’m thinking. There have been times I could remember “someone” having said “something” about a subject, and I can’t even remember enough to google it. And then you post it. Oh, YEAH!!! There it is! How did Patty know?

    your passionate love of animals is a wonderful quality. You have a killer sense of humor, even beyond the snark, which has left me in stitches a few times.

    Even though the regulars here have varying degrees of legal and political knowledge, we all share a similar sense of right and wrong. We all love the Constitution, pilgrim or not, and we care about law being applied fairly. There are more reasons for us all to admire each other than there are reasons for us to compete with one another about things like who’s first. Patty, you’re awesome. So is Jill. So are just about all the people who post here. And I appreciate that you care about our country and its laws to take some of your hard-earned free time to share your knowledge with us.

  12. Mike, etal. I agree that I expect Bernie Boy to get a relatively light sentence, but I hope I am wrong. I think you are probably right that there is a deal involving the sons and the wife. I sure hope he doesn’t get to keep any assets and is forced into bankruptcy. It would be the best sentence.

  13. Madoff is, without doubt, despicable and at the very least, a sociopath. What he isn’t, is stupid. Clearly, at one point over the last 20 years he considered what would happen if it all fall apart. I’m no brain trust and even I have taken the time to protect my children’s future. I assume that his lawyer Sorkin, who is also listed as one of Madoff’s ‘victims’, played a role in setting up a nice little nest egg for Ruthie and the kids. Ruthie fighting to keep $70 million is so ugly. How much of other people’s money does she need?

  14. rafflaw:

    “I sure hope he doesn’t get to keep any assets and is forced into bankruptcy”

    It’s the same way I feel about the all too common appearances of the top yahoos of the housing, or banking, or finance, or the CEO’s of whatever who regularly “appear on the Hill” for their grilling. The MSM make this big deal about some of these folks “getting grilled”.

    “Oooh! They appeared on the Hill and got grilled by Congress!”

    In the end, however, they still get to keep their tens of millions. Nothing really happens. Congress wags their fingers at them and makes all the correct noises about how wrong they were. and about how disappointed they are in their behavior.

    But the money is never recovered. The search ends.

    But at least they were, for a few brief moments, shamed in front of the people before they slipped away with all the money …

  15. Mojo:

    In my world it would be the other way around, our elected officials are morally bankrupt and should be lead before the people to answer to us for screwing this country up.

    We live in an oligarchy made up of the worthless rich (the ones that inherit their money and dont do a days productive work) and the political class who pass laws so the worthless rich can keep their fortunes intact for the next generation of the lucky sperm club.

  16. Bron,

    I agree with Mojo, that there’s a lot of truth to what you said. My only hope in this case is that some of his victims are really wealthy and connected. He may not get off as easily as he thinks. I suspect there are people who can hire excellent lawyers and forensic accountants and eventially the wedding ring that Mrs. Madoff swallowed will come out in the end!

  17. LindyLou 1, March 11, 2009 at 7:07 pm

    Based on what you wrote, I’d say you and I are more often on the same wave length than you and Jill have eve been!

    And don’t sell yourself short in the ‘Articulate Department’, either.

    In earnest, I appreciate what you say mostly, except for the part about Jill being ‘awesome’.

    I disagree… :P

    My issues with her are related to the fact that she is in competition with me first, almost daily, and in a pathologically passive-aggressive manner and has been for almost a year
    – not the other way around. Sorry.

    AND in so being disrupts this blog at the expense of all turlees.

    In my view, Jill is a inarticulate ‘potty mouth’ and a Christian/religious hater as evidenced by her recent irreverent declaration to hold a plastic baby Jesus wrapped in swaddlng clothes and shoot ‘pee’ onto crowds of protesters against free religious expression at Christmas time this past year.

    I am not a practicing Catholic in the true sense any longer, but some of my best religious memories in childhood are of Christmas Eve – cutting a tree, carrying it home and decorating it, Midnight Mass, our displaying of traditional antique family heirlooms, and of the live nativity scene because the animals used, a mule, a cow, and two sheep, were kept in our barn every year next to the church.

    Needless to say, as a child and early animal lover, I loved it!

    I resent similar aspersions cast by Jill, regularly, because so often, as I’ve stated, she simply does not know what she is talking about.

    And apparently, she doesn’t care either.

    Ignoring me, an original turlee, and my contributions to this blog while stealing my contributions and attributing them to herself pretty much defines who she is, don’t you think?

  18. I’m actually acquainted with one of Madoff’s victims. A brilliant person who worked his way to wealth from a youth of having little. He is not only one of the smartest men I know, but one of the most decent. A wealthy man who has remained a lifelong Democrat and Liberal and who hasn’t forgotten his own humble origins. I highly doubt that his investment with Madoff has him poverty stricken, but if a man of his sophistication could be fooled, it is a symptom of how Bush, with an assist from Clinton has unraveled the structure set up to protect us from con men posing as financial wizards. While I feel compassion for this acquaintance and truly wish him well, I know him well enough to know he will come through this.

    When I think though, of the millions of families pushed into poverty by by job loss, phony mortgage schemes and the hard sell of overpriced credit, my empathy expands to rage against the thieves who have engineered this and will probably escape any serious consequences, with their ill-gotten gains intact.
    They are human pigs feeding at the trough of their fellow citizens blood, without any motivation save ego and selfishness. I want to see Madoff punished severely, but I don’t want these others to escape. Madoff preyed on the haves and yet deserves punishment fitting the crime. It is to my mind a far worse crime that has been committed upon those least able to defend themselves. Retribution of the sort that will give others pause to play these vile games is required if we are ever to become the society we pretend to be.

  19. …” but if a man of his sophistication could be fooled, it is a symptom of how Bush, with an assist from Clinton has unraveled the structure set up to protect us from con men posing as financial wizards. While I feel compassion for this acquaintance and truly wish him well, I know him well enough to know he will come through this…”

    Huh…? Hellooooo…,
    …what???

  20. It will be interesting to see how far the government will go to protect Madoff’s victims. The IRS and state revenue departments collected a boat load of money on the capital gains people thought they had made. Will the money be returned? Should it be?

  21. chicago,

    Therein lies a real tax boondoggle. Given that the SEC was abjectly inept, the victims deserve all the leniency the government can afford.

  22. chicAgo,

    Great question. The IRS is its own sub government, that’s the hitch.
    A federal tax refund to all Madoff investors would be fine by me.

  23. I agree that all monies should be refunded for the simple reason that Uncle Sam failed in even the most basic of ways to protect investors from such an obvious scam. When the SEC refused to act on the warnings of whistleblower, Harry Markopolos, they in fact added to Madoff’s credibility. If we can’t trust our government to do right by us, who do we trust? OK, ignore the last question, I’ve known the answer since college. We trust only ourselves.

  24. Chicago,

    I think your point about the SEC adding to his credibilty cannot be denied. If the govt. really wanted to they could take advantage of the world banking secrecy law update and find the money which, without a doubt, is there.

  25. Mike – Despite what Madoff said in court, prosecutors claimed in Count 1 that he’s been running this scam since the 1980’s, which, if accurate, predates both Clinton and Bush.

    I think there’s a lot more to this story we have yet to hear, including why the SEC when they did investigate him recently, didn’t find anything. His lawyer ‘Ike’ Sorkin used to head the NY office of the SEC around the time he and Madoff first met
    -in the 1980’s. Which is also when Madoff was chair of NASDAQ!

    From everything I have have been able to glean about this man,
    he is a certifiable ‘evil genius’. What kind of person would you have to be to rip off holocaust survivor Elie Wiesel?
    The Devil, himself, I’d say.

  26. Can you imagine if, just once, they opened up all bank accounts. Sort of a one time only housecleaning. Think of what they’d find…everything from the profits of the Holocaust to the nest eggs of third world dictators. I wonder how many of the problems of the world could be solved by just a one time airing of the banks around the world that only exist to hide and shelter the profits of the unscrupulous? One more thing Obama can add to his list of all the wrongs that need to be righted.

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