Madoff Victims Speak Their Minds

James Cohen in HedgeFund.net, June 29, 2009

Media Source

They came into the federal courtroom in downtown Manhattan. Some were young, some old. Some had looks of despair, others looked determined.

They were the victims of Bernard Madoff’s Ponzi scheme, the biggest financial fraud ever perpetuated. They had come to tell Judge Denny Chin how many years should be meted out as punishment.

Not one spoke about mercy. Rather, a constant theme that was struck by Madoff’s victims was that his betrayal went far beyond financial loss.

Madoff pleaded guilty to 11 counts of fraud in March. His Ponzi scheme has been, at times, calculated to involve as much as $65 billion. He has been in prison since he pleaded guilty while he awaited sentencing.

Starting off the nine investors who spoke at Madoff’s sentencing Monday, Don Ambrosino, a retired New York City corrections officer, said he and his wife lost everything with Madoff.

“[Madoff] is in prison much the same way he imprisoned us and many others, he said. “I would like someone in the court to say how long is my sentence.”

Chin responded to the pleas of those defrauded by Madoff by hitting him with the full sentence allowed by law: 150 years.

In doing so, he rejected arguments made by Madoff’s attorney, Ira Lee Sorkin, that he should sentence him to 12 years in prison.

Sorkin tried to convince the court that Madoff deserved some measure of clemency because he had cooperated with authorities in trying to track assets. Sorkin also said that the sentencing report put the actual loss at $13 billion.

Chin, however, said the $13 billion did not include the money that was funneled to Madoff through funds-of-funds.

Instead, Chin talked about a letter he received from a woman in her 80s who wrote that, after her husband died, she visited Madoff who put his arm around her and promised that her husband’s money was safe. Now, she said, she would have to sell her home because not only her husband’s money, but her own pension fund was gone.

“Trust was broken,” Chin said. Not only did Madoff betray his investor’s trust, Chin continued, but also the public’s trust in “financial institutions . . . and our government’s ability to regulate and protect.”

Chin also pointed out that no one had written him asking for leniency. None of Madoff’s family were present for his sentencing.

However, Madoff’s wife Ruth issued a statement after he was sentenced, in which she claimed to have been as duped as any of his victims.

“The man who committed this horrible crime is not the man who I knew for all these years,” she said.

There was scattered applause when Chin read off the 150-year sentence, but the mood in the courtroom was generally subdued.

At times, the hearing had the air of a Greek tragedy to it.

Michael Schwartz, who at 33, said he had the youth and health to make up for what he lost in Madoff’s scheme, said, his mentally disabled brother could not do that for himself.

“Madoff stole from the disabled to pay for his family’s decadent lifestyle,” Schwartz said. “His jail cell should become his coffin.”

Miriam Siegman, 65, said she sometimes resorts to taking food from dumpsters because she has so little money left.

“He discarded me like roadkill,” she said of the man she trusted with her lifesavings.

Burt Ross, a former mayor of Fort Lee, N.J., invoked the writer Dante, who wrote about divine punishment in his epic poem, The Inferno. Ross said he and his wife lost $5 million.

Dante, Ross said, consigned those who committed fraud to the lowest reaches of Hell and those who betrayed others trust to an even worse fate. In The Inferno, Dante pictured Satan with three mouths that eternally chewed on Judas Isacariot, who betrayed Jesus Christ, and Brutus and Cassius, who assassinated Julius Caesar.

“May Satan grow a fourth mouth where Bernard L. Madoff deserves to spend the rest of eternity,” Ross said.

Madoff will be able to appeal his sentence, but James Cohen, a criminal defense attorney and professor at Fordham University School of Law, said that the appeals court usually gave a lot of deference to the sentencing judge.

Cohen questioned the value of the 150-year sentence, however.

“I was surprised that Judge Chin bowed to what I consider to be a mob type mentality,” Cohen said. “He could have sentenced him to 30 years; it would have been the same as 150 years.”

Madoff is now 71 and would be unlikely to get out of prison alive if he were sentenced to more than the minimum permitted by law.