Wednesday, July 1, 2009

The Madoff Forfeiture

Previously posted here was the court's forfeiture order in the Madoff case. Guest blogging on the Madoff forfeiture is Attorney Peter Goldberger who writes:

The criminal forfeiture order, negotiated between the defendant and the government w/o input from the victims as guaranteed by the CVRA (see 18 USC 3664(d) and FedRCrimP 32(i)(4)(B)), ensures Mrs. Madoff a couple of million to live on for the rest of her lonely life.  It takes all of the defendant's assets and makes them property of the United States. (It also disregards the binding Santos definition of "proceeds," but never mind that.)  By leaving the defendant with nothing, it prevents him from making restitution to any victim (although he can and will be ordered to make restitution, he won't have a penny other than prison earnings with which to comply).  While a victim can apply to the Attorney General for a partial "remission" of the forfeiture (see 21 USC 853(i)(1)(incorporated by reference into other forfeiture laws), there are no governing standards, no due process, and no judicial supervision -- it is 100% in the discretion of the DOJ.  Section 3572(b) of title 18, however, prohibits the judge from ordering any "financial penalty" (which would include criminal forfeiture) if doing so would impair the ability of the defendant to pay restitution.  On that basis, I believe the forfeiture order in Madoff's case is illegal.  I wonder if any victim will take that position and file a mandamus under the CVRA ((3771(d)(3) & FedRCrimP. 60 (b)(5)(B)) against it?


Forfeiture, Fraud | Permalink

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Ellen: As you know, I wrote that post over the weekend, after the forfeiture was signed and prior to the actual Madoff sentencing. Having quickly reviewed the transcript of Monday's sentencing, it appears that Judge Chin (contrary to my confident prediction) did not order restitution to any victim at all at sentencing. This only reinforces the concerns expressed in my "guest post."

Posted by: Peter G | Jul 1, 2009 8:43:39 AM

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