Madoff has seen the last of his $7 million penthouse, as the judge revoked his bail on Tuesday. Allan Dodds Frank reports from the courthouse.
As you watch the replays of Bernard Madoff's entrance to federal court at 7:19 a.m. on Tuesday, you may notice that he was wearing no topcoat. He knew where he was going.
No doubt Bernie got there early so he, his lawyers and the prosecutors could review the statement he most likely would read acknowledging the scope of his crimes and that some of them occurred in New York City, within the jurisdiction of this U.S. District Court. He offered a tepid, somewhat perfunctory sounding apology: "I cannnot adequately express how sorry I am for my crimes." Real contrition may wait until his sentencing, now scheduled for June.
The 11 felony counts carry a potential cumulative sentence of 150 years in prison, U.S. District Judge Denny Chin chose to revoke Madoff’s $10 million bail and remand him to prison immediately.
Clearly, a barber had visited him in the penthouse.
Considering a recent Daily Beast report suggesting that Madoff has not been cooperating—at least not beyond turning over lists of his assets to the Securities and Exchange Commission and the bankruptcy trustee—the odds of Bernie walking out of the court were slim.
In the three decades or so that I have covered the nation’s most famous white-collar crooks in federal and state court, rarely have I seen a defendant maintain such consistent demeanor and such clueless body language.
So far, with the exception of shoving and punching back in front of his apartment early on at that photographer with the wide-angle lens, Madoff has looked remarkably serene, the picture of a man without a conscience.
In court Tuesday, as reporters watched from the jury box, Madoff stood erect at the defendant’s table for 20 minutes. He propped himself up with two hands in front of him, his thumbs and little fingers off the edge—the three middle fingers of each hand vertical on the table, as if to hold him ramrod straight. He looked at Judge Chin without hesitation, answering questions unfalteringly and in mild, flat tones.
Was the secret to Madoff’s success as a con artist his ability to lock his face in neutral?
Only an involuntary twitch of his right eye, and occasionally both eyes in a way that also wrinkled the bridge of his nose, betrayed any possible stress.
While there has been speculation about his health, he told the judge he was not taking any medications that would affect his judgment. And his hair—that steel gray and pepper—was the same curly, just-touching-the-collar length it was when he was arrested Dec. 11. Clearly, a barber has visited him in the penthouse.
Defense attorney Gerald Lefcourt, a past president of the National Association of Criminal Defense Lawyers, said the party at Bernie’s East 64th Street home will be over soon. The court proceedings Tuesday made clear that he has no deal with the government to minimize the charges. The convenience of having him in his apartment, easily available for meetings with prosecutors, SEC officials, and defense lawyers, is now overshadowed by the call of justice.
Faced with public outcry and more outrage from victims of Madoff’s scheme, prosecutors succeeded in getting him put away immediately—in the Metropolitan Corrections Center—while he awaits sentencing.
Much like another “Big Time in the Big House Bernie”—former WorldCom CEO Bernard Ebbers—Madoff has little chance under federal sentencing guidelines to escape a long term when he is sentenced by Judge Chin in the next few months. While the guidelines are only advisory, the highest fraud loss contemplated by the sentencing guidelines is $400 million, a number roughly three times higher than the original losses in Charles Ponzi’s scheme would be after they’re adjusted for inflation.
For starters, that number—of course—pales in comparison to any one of the estimates of the scale of Madoff’s crimes, with $65 billion being the latest number bruited about. That’s before the number of victims are taken into account. Finally, when the 64-year-old Ebbers contested his 25-year-sentence as amounting to life in prison, the 2nd Circuit ruled that it was “harsh but not unreasonable.”
Only a surprise announcement by prosecutors that Bernie is turning over the evidence on his family could change that. Otherwise, the Justice Department will have to prove that Bernie was not the Lone Ranger in defrauding thousands of people of billions of dollars. They may start with the notion that his wife, Ruth, could not possibly have more than $60 million in legitimate money. The judge, said Lefcourt, could rule that the New York apartment, the other real estate, the watches, and all the money is forfeited to the government, and Ruth would have to sue to try to get her portion back.
So how did Bernie look Tuesday? Dapper. Low key. Trustworthy! He wore one of his custom-tailored gray suits, a white shirt, black tie, black shoes, and a big stainless-steel watch—maybe it was platinum—on his left wrist. I was too far away to discern the brand, but in light of his history of shipping off fancy watches, I wonder whether he will try to give this one away, too, before he appears in court—or whether it is the one he plans on wearing behind bars.
Allan Dodds Frank is a business investigative correspondent who specializes in white collar crime.