NEW YORK – A federal judge rejected Bernard Madoff’s plea for leniency Monday, sentencing the 71-year-old swindler to spend the rest of his life in prison for an “extraordinarily evil” fraud that took a “staggering toll” on thousands of victims.
U.S. District Judge Denny Chin cited the unprecedented nature of the multibillion-dollar fraud as he sentenced Madoff to the maximum of 150 years in prison, a term comparable only to those given in the past to terrorists, traitors and the most violent criminals. There is no parole in federal prison so Madoff will most likely die there.
“Here the message must be sent that Mr. Madoff’s crimes were extraordinarily evil and that this kind of manipulation of the system is not just a bloodless crime that takes place on paper, but one instead that takes a staggering toll,” said Chin.
The massive Ponzi scheme run by Madoff since at least the early 1990s demolished the life savings of thousands of people, wrecked charities and shook confidence in the U.S. financial system.
The sentence reflected a growing tendency over the last decade to give white-collar criminals lengthy prison terms. But nothing before has come close to the time given Madoff – an outcome that prompted scattered applause and whoops from a group of burned former clients in a packed Manhattan courtroom.
The judge noted that not one of the more than 100 letters he received supported Madoff or described any good deeds he had done.
“The absence of such support is telling,” Chin said.
Chin announced the sentence with Madoff standing at the defence table, wearing a dark suit, white shirt and a tie, and looking thinner than his last court appearance in March. He gave no noticeable reaction when the sentence was announced.
He also showed no emotion though he looked down earlier in the hearing as he listened to nine victims spend nearly an hour venting their despair and anger. Some openly wept or raised their voices, labelling Madoff a “monster,” a true beast” and an “evil low-life.””
“Life has been a living hell. It feels like the nightmare we can’t wake from,” said Carla Hirshhorn.
“He stole from the rich. He stole from the poor. He stole from the in between. He had no values,” said Tom Fitzmaurice. “He cheated his victims out of their money so he and his wife Ruth could live a life of luxury beyond belief.”
Dominic Ambrosino called it an “indescribably heinous crime” and urged a long prison sentence so he “will know he is imprisoned in much the same way he imprisoned us and others.”
He added: “In a sense, I would like somebody in the court today to tell me how long is my sentence.”
Sheryl Weinstein, a certified accountant, said Madoff was effective because he seemed normal.
“But underneath the facade is a true beast,” she said. “He should not be given the opportunity to blend so seamlessly into our society again.”
When asked by the judge whether he had anything to say, Madoff slowly stood, leaned forward on the defence table and spoke in a monotone for about 10 minutes. At various times, he referred to his monumental fraud as a “problem,” an error of judgment” and “a tragic mistake.””
He claimed he and his wife were tormented, saying she “cries herself to sleep every night, knowing all the pain and suffering I have caused,” he said. “That’s something I live with, as well.”
He then finally looked at the victims lining the first row of the gallery.
“I will turn and face you,” he said mechanically. “I’m sorry. I know that doesn’t help you.”
His immediately family did not attend the sentencing. But Ruth Madoff – often a target of victims’ scorn since her husband’s arrest – broke her silence afterward by issuing a statement through her lawyer. She said she, too, had been misled.
“I am embarrassed and ashamed,” she said. “Like everyone else, I feel betrayed and confused. The man who committed this horrible fraud is not the man whom I have known for all these years.”
Prosecutor Lisa Baroni said Madoff deserved a life sentence because he “stole ruthlessly and without remorse.”
Outside court, some victims said it was time to move on.
“He stole my money. He didn’t steal my life,” said Ron Weinstein, whose wife spoke in court. “I’m not going to sit around and mope about it.”
Madoff, who has been jailed since March, already has taken a severe financial hit: Last week, a judge issued a preliminary US$171-billion forfeiture order stripping Madoff of all his personal property, including real estate, investments, and $80 million in assets his wife Ruth had claimed were hers. The order left her with $2.5 million that couldn’t be tied to the fraud.
The terms require the Madoffs to sell a $7-million Manhattan apartment where Ruth Madoff still lives. An $11-million estate in Palm Beach, Fla., a $4-million home in Montauk and a $2.2-million boat will be put on the market as well.
Before Madoff became a symbol of Wall Street greed, he earned a reputation as a trusted money manager with a Midas touch. Even as the market fluctuated, clients of his secretive investment advisory business – from Florida retirees to celebrities such as Steven Spielberg, actor Kevin Bacon and Hall of Fame pitcher Sandy Koufax – for decades enjoyed steady double-digit returns.
But late last year, Madoff made a dramatic confession: Authorities say he pulled his sons aside and told them it was “all just one big lie.”
Madoff pleaded guilty in March to securities fraud and other charges, saying he was “deeply sorry and ashamed.” He insisted that he acted alone, describing a separate wholesale stock-trading firm run by his sons and brother as honest and legitimate.
Aside from an accountant accused of cooking Madoff’s books, no one else has been criminally charged. But the family, including his wife, and brokerage firms who recruited investors have come under intense scrutiny by the FBI, regulators and a court-appointed trustee overseeing the liquidation of Madoff’s assets.
The trustee and prosecutors have sought to go after assets to compensate thousands of victims who have filed claims against Madoff. How much is available to pay them remains unknown, though it’s expected to be only a fraction of the astronomical losses associated with the fraud.
The $171-billion forfeiture figure used by prosecutors merely mirrors the amount they estimate that, over decades, “flowed into the principal account to perpetrate the Ponzi scheme.” The statements sent to investors showing their accounts were worth as much as $65 billion were fiction.
The investigation has found that in reality, Madoff never made any investments, instead using the money from new investors to pay returns to existing clients – and to finance a lavish lifestyle for his family. The actual loss so far has been put at $13.2 billion. But the judge said that was a conservative estimate and noted that even Madoff told his sons in December it was a $50-billion fraud.