Letter of Apology » Sentencing

DEA Agent Faints Under Withering Cross-Examination

Solomon Wisenberg — Fri, 09 Apr 2010 15:21:51 +0000

I’m not making this up. It happened in Miami at a federal sentencing hearing. Every defense lawyer’s dream. The criminal defense attorney cross-examining was Jeffrey Weiner. The DEA Agent is okay. Melissa Holsman of the Miami Herald has the story here.

Dreier Sentenced To 20 Years

Solomon Wisenberg — Tue, 14 Jul 2009 18:13:33 +0000

Marc Dreier was sentenced to 20 years imprisonment yesterday by U.S. District Judge (SDNY) Jed Rakoff. The government had asked for 145 years. Dreier’s attorney, Gerald Shargel, requested 10 to 12 years for his client. With good time, Dreier should do about 17 years and be released at the age of 76. His children, now teenagers, will then be in their mid-thirties. Sobering numbers for those caught up in securities fraud and securities fraud investigations. When the SDNY prosecutors threaten you with life imprisonment if you don’t plead guilty and cooperate, you’d better believe they mean business. Dreier’s case is different since he pled guilty early on and had no higher-ups to implicate. It is unclear from the Wall Street Journal story here whether Judge Rakoff granted a downward variance, but I assume that he did. It is impossible to imagine such a “light” sentence under the old mandatory Sentencing Guidelines regime. This is not meant as a criticism of the sentence. Just a reminder that, even in the age of Booker-Gall-Kimbrough, the odds of receiving a substantial term of imprisonment are high for those who roll the dice, go to trial, and lose.

Connecticut Housing Market Collapses: $5 Million Mansion Goes For 10 Bucks!

Solomon Wisenberg — Thu, 18 Jun 2009 14:56:22 +0000

Well, not exactly. Former Cendant Corp. CEO Walter Forbes is doing 12 years in Allenwood for accounting fraud. His sentence included a $3.275 billion restitution order. The federal government moved, post-sentencing, to liquidate Forbes’ assets in order to satisfy the restitution order. The feds wanted Forbes’ $5 million house, claiming that it was purchased with ill-gotten gains. Now Forbes’ wife Caren has filed for divorce seeking equitable division of the couple’s property. But the mansion is currently held in Caren’s name only, having been sold to her by Walter for a mere $10. Our government is not amused. Nora Dannehy, Acting U.S. Attorney for the District of Connecticut, has taken the highly unusual step of moving to intervene in the Bridgeport Superior Court divorce action. According to Dannehy’s motion: “This court should not allow the Forbes family to undermine the government’s work to enforce the restitution order under the guise of a simple, uncontested, family court matter.” The Connecticut Post story by Daniel Tepfer is here.

Juror Number 6

Solomon Wisenberg — Sun, 03 May 2009 21:46:46 +0000

Federal judges are allowed, in imposing a sentence, to consider alleged criminal conduct against a defendant, even if the trial jury has already acquitted the defendant of those very charges. The sentencing court can use this “acquitted conduct” to increase the defendant’s sentence, provided that a preponderance of the evidence supports the allegations.

Today’s Washington Times has an interesting piece here by Jim McElhatton on the late Jim Caron, aka Juror Number 6. Caron sat for 10 months on a DC federal jury whose members ultimately acquitted defendant Antwuan Ball of all serious charges, convicting the defendant on only a minor drug count. When Caron found out that the government wanted Ball to get 40 years in prison and was using Ball’s acquitted conduct as part of its argument, Caron became furious and wrote a letter of complaint to the trial court. That letter has taken on a life of its own, and has been cited in federal appellate opinions and legal briefs.

Big Dig Contractor Sentenced, Fined In Overbilling Scheme

Dave Westheimer — Tue, 11 Nov 2008 07:05:21 +0000

McCourt Construction Company was sentenced on Friday to a $500,000 fine and three years probation by US District Judge Richard Stearns in Boston for its role in an overbilling scheme on Boston’s Big Dig project. Stearns also ordered the company to pay $600,000 restitution to the Massachusetts Turnpike Authority. McCourt pleaded guilty earlier this year to conspiracy to defraud the US government with respect to claims on a federal highway project. Two of its supervisors pleaded guilty conspiracy to commit highway project fraud by making false statements and were sentenced last month. The charges arose from overbilling on the I-93 Tip O’Neill Tunnel project. McCourt admitted participating in over 1500 instances of overbilling between 2002 and 2005 in which subcontractors charged journeyman labor rates for work actually done by apprentices (DOJ, Boston Bizjournal).

Two Big Dig Managers Sentenced

Dave Westheimer — Wed, 22 Oct 2008 05:40:33 +0000

Ryan McCourt and Kenneth Hartley, both former managers for McCourt Construction Company, were sentenced on October 16 by US District Judge Joseph Tauro in Boston for their roles in an overbilling scheme on Boston’s Big Dig project. Ryan McCourt was sentenced to two years probation, while Kenneth Hartley was sentenced to six months in prison and two years of supervised release. Both men pleaded guilty in July to a single-count information charging conspiracy to commit highway project fraud by making false statements regarding the cost of work performed on a federal highway project, admitting that they took part in overbilling the I-93 Tip O’Neill Tunnel project in a scheme where subcontractors charged journeyman labor rates for work actually done by apprentices (earlier). McCourt Construction also pleaded guilty and will be sentenced on November 7 (Boston Globe, DOJ).

Lerach Moved To Higher Security Prison

Dave Westheimer — Thu, 18 Sep 2008 06:43:55 +0000

Convicted former class action attorney Bill Lerach has been transferred from the minimum security federal prison camp at Lompoc, California to the Federal Correctional Institution in Phoenix, “a medium security facility for male offenders.” Lompoc was a fenceless camp, Phoenix has prison cells. Officials won’t comment but the move is apparently in response to Lerach’s alleged offer to let a prison guard use his San Diego Chargers season tickets (earlier), which landed him in “administrative segregation” for 23 hours a day (Legal Pad, Portfolio).

Lerach In Lockdown At Lompoc

Dave Westheimer — Wed, 10 Sep 2008 06:17:38 +0000

Convicted former class action attorney Bill Lerach, sentenced to two years in prison for his role in his firm’s kickback scandal, has landed in hot water: shortly after arriving at the minimum security federal prison camp at Lompoc, California in May, he allegedly offered a guard use of his San Diego Chargers season tickets. The guard reported the incident and Lerach has reportedly been put in “administrative segregation” for 23 hours a day, pending a hearing. This is considered a “high category” offense for an inmate and could result in his transfer to a higher security prison and other sanctions (ABA Journal, Legal Week).

Two Defendants In Securities Fraud Case Get 60 Month Sentences, Well Below Guidelines

Dave Westheimer — Tue, 19 Aug 2008 06:08:25 +0000

Lennox and Lester Parris, brothers and principals of now-defunct Jericho, New York-based bottled water distributor Queénch, Inc., were each sentenced last Wednesday in Brooklyn to 60 months in prison for securities fraud in connection with the manipulation of stock prices which allegedly cost investors over $2.5 million. They were convicted in 2007 on six counts including securities fraud, conspiracy to commit securities fraud, witness tampering and conspiracy to commit witness tampering. What’s unusual here, although the DOJ press release fails to mention it, is that US District Judge Frederic Block departed sharply downward from federal sentencing guidelines, which called for a recommended sentences of 30 years to life based on offense levels of 42 for both men. Block criticized the guidelines’ “fetish with absolute arithmetic”, writing that while the sentences were well-deserved, the crimes did not rise to the level of Enron, WorldCom and Computer Associates. Mark Fass’ NY Law Journal story has more, including a link to the decision.

Refco’s Bennett Sentenced To 16 Years In Prison

Dave Westheimer — Thu, 03 Jul 2008 17:27:56 +0000

US District Judge Naomi Reice Buchwald has sentenced former Refco Chairman and CEO Phillip Bennett to 16 years in prison. Bennett pleaded guilty in February to conspiracy, wire fraud, bank fraud, money laundering and making false SEC filings in connection with Refco’s 2005 collapse which cost investors an estimated $2.4 billion. Bennett will begin serving his sentence on September 4 and will be under house arrest until then (Reuters via Yahoo News).