Jun 29, 2009 11:36 am US/Eastern
Madoff Sentenced To 150 Years In Prison
Maximum Sentence For Multibillion-Dollar Ponzi Scheme
NEW YORK (CBS) ―
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Disgraced financier Bernard Madoff has been sentenced to 150 years in prison for running the largest ponzi scheme in history.
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Disgraced financier Bernard Madoff has been sentenced to 150 years in prison for running the largest ponzi scheme in history.
U.S. District Judge Denny Chin handed down the sentence after Madoff apologized to his family and to the victims of his multibillion-dollar fraud scheme.
Chin said the federal probation department recommends that Madoff get 50 years in prison for the fraud scheme that bilked clients out of billions.
The 71-year-old financier said Monday at his sentencing that he "will live with this pain, this torment, for the rest of my life."
Madoff says that he dug himself "deeper into a hole" as the scheme progressed.
Victims who lost millions of dollars earlier urged a stiff sentence for the former Nasdaq stock market chairman.
Madoff has pleaded guilty to securities fraud and other charges in March and has been jailed ever since.
Madoff's fraud victims urged a stiff sentence for the mastermind of a multibillion-dollar fraud scheme.
Dominic Ambrosino called the fraud an "indescribably heinous crime" and says he has no credit and can't get a mortgage.
Tom Fitzmaurice said Madoff stole from the rich, the poor and the "in between. He had no values."
He said "my life will never be the same."
There was no shortage of emotion in recent e-mails and letters to the judge by victims.
Carla and Stanley Hirschhorn wrote that they lost their life savings - "a living nightmare that we can't wake up from."
Miriam Siegman expressed outrage "at the spectacle of a man playing with his victims - thousands of them - who he knew were facing a kind of death, playing with them as a cat would with a mouse."
Prosecutors argued in court papers Friday that federal sentencing guidelines allow the 150-year sentence. Any lesser term, they said, should at least be the equivalent of a life sentence.
"The sheer scale of the fraud calls for severe punishment," the prosecutors wrote.
The jailed Madoff already has taken a severe financial hit: Last week, a judge issued a preliminary $171 billion forfeiture order stripping Madoff of all his personal property, including real estate, investments, and $80 million in assets his wife Ruth had claimed were hers. The order left her with $2.5 million.
The terms require the Madoffs to sell a $7 million Manhattan apartment where Ruth Madoff still lives. An $11 million estate in Palm Beach, Florida, a $4 million home in Montauk and a $2.2 million boat will be put on the market as well.
Before Madoff became a symbol of Wall Street greed, the former Nasdaq chairman had earned a reputation as a trusted money manager with a Midas touch. Even as the market fluctuated, clients of his secretive investment advisory business - from Florida retirees to celebrities such as Steven Spielberg, actor Kevin Bacon and Hall of Fame pitcher Sandy Koufax - for decades enjoyed steady double-digit returns.
But late last year, Madoff made a dramatic confession: Authorities say he pulled his sons aside and told them it was "all just one big lie."
Madoff pleaded guilty in March to securities fraud and other charges, saying he was "deeply sorry and ashamed." He insisted that he acted alone, describing a separate wholesale stock-trading firm run by his sons and brother as honest and legitimate.
Aside from an accountant accused of cooking Madoff's books, no one else has been criminally charged. But the family, including his wife, and brokerage firms who recruited investors have come under intense scrutiny by the FBI, regulators and a court-appointed trustee overseeing the liquidation of Madoff's assets.
The trustee and prosecutors have sought to go after assets to compensate thousands of burned victims who have filed claims against Madoff. How much is available to pay them remains unknown, though it's expected to be only a fraction of the astronomical losses associated with the fraud.
Sharon Lissaur is getting a chance to do something most of Bernard Madoff's 8,000 victims can't; she is one of the few selected to speak at the swindler's sentencing tomorrow.
"I just want him to hear how he has ruined and destroyed my life," Lissaur told CBS News.
The $171 billion forfeiture figure used by prosecutors merely mirrors the amount they estimate that, over decades, "flowed into the principal account to perpetrate the Ponzi scheme." The statements sent to investors showing their accounts were worth as much as $65 billion were fiction.
The investigation has found that in reality, Madoff never made any investments, instead using the money from new investors to pay returns to existing clients - and to finance a lavish lifestyle for his family.
In bankruptcy filings, Trustee Irving Picard say family members "used customers accounts as though they were their own," putting Madoff's maid, boat captain and house-sitter in Florida on the company payroll and paying nearly $1 million in fees at high-end golf clubs on Long Island and in Florida.
Picard has sought to reclaim ill-gotten gains by freezing Madoff's business bank accounts and selling legitimate portions of his firm. (Its season tickets for the Mets went for $38,100.) He's also sued big money managers and investors for billions of dollars, claiming they were Madoff cronies who also cashed in on the fraud.
The defendants include leading philanthropists Stanley Chais and Jeffry Picower - from whom Picard is seeking at least $5.1 billion alleged to have come out of victims' pockets - and hedge fund manager J. Ezra Merkin. All have denied any wrongdoing.
In other Madoff developments:
ProPublica's Jake Bernstein reported that a Madoff associate, Jeffry Picower, may have benefitted even more from Madoff's fraudulent scheme than Madoff himself did.
Ruth Madoff agreed to forfeit more than $80 million worth of property sought in the case against her husband, which she had previously laid claim to.
(© 2009 CBS Broadcasting Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)
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