Madoff Still Out: What the Law Says

Let me say first off, to quote the old Letterman sidekick, Larry “Bud” Mellman, I am not an attorney. That didn’t stop me from blogging last week about Bernard Madoff, confessed perpetrator of history’s largest fraud, and how the federal magistrate needed to immediately revoke his bail. I mean, you steal $50-billion, it seems to me like you need to head downtown. Justice, I (and many, many others) thought, doesn’t get more clear cut than that, right?

Wrong. I’m sure you’ve heard the news. Judge Roland Ellis today ruled against prosecutors who wanted Madoff’s bail revoked. Here’s the story from the Washington Post, which includes a link to the judge’s decision.

Rather than spend the rest of the day ranting about the seemingly incredible injustice at work here (a rich guy steals more money than the GNP of certain countries, and he gets to stay in his penthouse; a poor guy steals a television and goes to Rikers), I decided in my non-lawyerly way to actually read the decision. It won’t make you any less mad, but it’s instructive.

Here are two key passages: the first addresses what I’ll call the “common sense” argument, which says the man has admitted to a crime of enormous proportions, and just about everybody wants to see him in jail pending trial. But Judge Ellis wrote:

"The issue at this stage of the criminal proceedings is not whether Madoff has been charged in perhaps the largest Ponzi scheme ever, nor whether Madoff's alleged actions should result in his widespread disapprobation by the public, nor even what is appropriate punishment after conviction. The legal issue before the Court is whether the Government has carried its burden of demonstrating that no condition or combination of conditions can be set that will reasonably assure Madoff's appearance and protect the community from danger."

Prosecutors obviously didn’t carry that burden in the view of Judge Ellis. He even added a few more “combinations of conditions” today that he feels will keep Bernie from slipping off to the Caymans or mailing out any more million dollar “heirlooms” to family members.

But what about the consequences of the crime? Charities that fed the hungry have closed because of what he did, thousands of elderly people who entrusted everything they had with this man now have nothing. One man has committed suicide, and what do you want to bet there will be more? Surely all THAT is sufficient to put Madoff behind bars.

Apparently not. Judge Ellis:

"the Government may seek a detention hearing in cases where the defendant has been charged in a case involving certain crimes, including: 1) a crime of violence, which carries a maximum term of ten years or more; 2) an offense which carries a maximum sentence of life imprisonment or death; 3) serious drug offenses; 4) felonies committed by certain repeat offenders; and 5) felonies that are not otherwise crimes of violence that involve a minor victim or the possession or use of a firearm, destructive device, or any other dangerous weapon. 18 U.S.C. § 3142(f)(1). As the Government appears to concede, there is no evidence that any of the enumerated bases in this subsection are applicable to Madoff's situation."

So take 20-bucks from somebody by threatening them with a baseball bat, and it’s off to jail. But take $50-billion through decades of smooth lies, and you get to think about what you’ve done sitting in your Jacuzzi.

I can read these legal justifications all night, and I still don’t agree with this. Madoff’s alleged felonies didn’t involve a “dangerous weapon” in the usual sense, but the end result is exponentially worse in terms of people getting hurt. One person wrote a comment on the Washington post blog above calling Madoff a "financial terrorist."

I suppose the law is the law. But it seems like there need to be provisions where the good opinions of the masses count for something. Bernie’s staying out of the slammer on a technicality, essentially. Too bad all those poor people who lost everything because of him don’t have a similar technicality available that would allow them to keep their homes.