Madoff Aides Won't Face Longer Terms as U.S. Drops Appealby
Government had warned the prison sentences were too lenient
Five of swindler's employees were convicted at trial in 2014
U.S. prosecutors dropped their bid to boost the prison terms for five of Bernard Madoff’s ex-employees, who received “merciful” sentences after being convicted of aiding his $17.5 billion fraud.
The sentences for the group, Madoff’s top aides, ranged from 2 1/2 years to 10 years, less than half the time sought by the U.S. In a notice filed Monday in federal appeals court in New York, the government didn’t explain why it was abandoning its effort. The U.S. Attorney’s Office in Manhattan declined to comment.
When U.S. District Judge Laura Taylor Swain passed sentence in December 2014, prosecutors warned the prison terms could hinder justice for victims of the biggest Ponzi scheme in U.S. history and set a bad precedent for future white-collar prosecutions.
A jury in March 2014 found the five former colleagues guilty on all charges in a total victory for the prosecution. Swain, who oversaw the five-month trial, cited the fundamental responsibility of Madoff, rather than his aides, as a key reason for the shorter prison terms, saying he manipulated loyal employees who lacked proper financial training.
Daniel Bonventre, Madoff’s ex-operations chief, was sentenced to 10 years behind bars; Annette Bongiorno, who ran the investment advisory unit at the center of the fraud, and Joann Crupi, who managed investment advisory accounts, each got six-year terms. Computer programmers Jerome O’Hara and George Perez, who automated the scam as it grew rapidly in the 1990s, got 2 1/2 years apiece.
All five former aides appealed their convictions, standing by their claims of innocence.
“The government’s action is the appropriate one and we look forward to the hearing of Ms. Crupi’s appeal,” her lawyer, Eric Breslin, said in an e-mail.
Roland Riopelle, Bongiorno’s lawyer, said his client’s sentence wasn’t lenient but was based on “very careful consideration” by Swain.
‘Sense of Mercy’
“While the sentence was severe, it was tempered by a sense of mercy, and it reflected my client’s fundamental decency as a human being,” Riopelle said.
Madoff’s New York-based investment-advisory firm spent customer cash on operations and to pay fake profits to investors instead of buying securities. The five defendants used millions of fake trade confirmations and bogus account statements to dupe customers for decades.
The fraud collapsed after Madoff’s arrest on Dec. 11, 2008. He was sentenced to 150 years in prison after a guilty plea.
The case is U.S. v. O’Hara, 10-cr-00228, U.S. District Court, Southern District of New York (Manhattan).