NEW YORK — Bernard Madoff, the mastermind behind one of the biggest and longest-running financial frauds in history, on Monday was ordered to serve 150 years in prison, the maximum sentence allowed.
The sentence far surpasses that of other recent high-profile white-collar crimes and took many noted criminal defense attorneys and former federal prosecutors by surprise. In handing down the sentence, federal District Judge Denny Chin acknowledged that any term above 25 years would be symbolic, given Madoff's advanced age of 71. Nevertheless, the judge said, it was important that the severity of the sentence serve as a deterrent to future offenders.
"The message must be sent that Mr. Madoff's crimes were extraordinarily evil," Chin said, his voice a stoic monotone.
However, several legal experts questioned whether the sentence — comparable only to those given in the past to terrorists, traitors and the most violent criminals — would achieve Chin's objective. "Unfortunately, the way it works with these types of financial crimes is that for some individuals, greed is larger and more powerful than the deterrent effect," said Lilly Ann Sanchez, a former federal prosecutor who is now a white-collar criminal defense lawyer in Miami.
Thomas Durkin, a partner at the law firm Mayer Brown who is also a former federal prosecutor, said the 150-year sentence is in effect a life sentence for anyone and could serve as a deterrent "if anyone thought about what they were doing before they committed the crime. … But the problem is most people don't."
Some other major white-collar criminals have received far shorter terms. Bernard Ebbers, the former head of WorldCom, received a 25-year sentence in 2006 for his role in an $11 billion accounting fraud that brought down the company. Dennis Kozlowski, former chief executive of Tyco International, is serving a sentence of 8 1/3 to 25 years, handed down in 2006, for securities fraud and other charges. Sholam Weiss, however, got 845 years in 2000 for his role in the collapse of National Heritage Life Insurance.
The massive Ponzi scheme run by Madoff since at least the early 1990s demolished the life savings of thousands of people, wrecked charities and shook confidence in the U.S. financial system.
Only Madoff and an accountant accused of failing to make basic auditing checks have faced criminal charges. But a person familiar with the investigation told the Associated Press on Monday that at least 10 more people are likely to face federal charges by the time the investigation is complete. The person, who spoke on condition of anonymity because the investigation is ongoing, wouldn't detail the likely charges or say whether they would include Madoff's family or former employees.
Chin said the symbolism of a maximum allowable punishment was important for victims. The crime, he said, had left the victims "doubting our financial institutions … our government's ability to regulate, and, sadly, themselves."
When Chin announced his sentence, some victims who had traveled to the Lower Manhattan courtroom let out a loud cheer.
One by one, nine victims had implored the judge to keep Madoff jailed for life, describing through tears and tremors of anger how he had forced them to take on several jobs instead of retiring, give up on paying for their children's college education, sell their homes or rely on government assistance.
"Mr. Madoff is sentenced to life as his victims are sentenced to life," Maureen Ebel, a Madoff victim and 61-year-old widow from Pennsylvania, said after the 90-minute hearing.
Madoff's attorney, Ira Lee Sorkin, had asked the judge for a 12-year sentence, saying that "vengeance is not the goal of punishment." Sorkin said that his client was cooperating with authorities and that Madoff had willingly given himself up when he informed his sons of his scheme in December.
But Chin declined, saying the magnitude of the fraud was "off the charts" — literally, as federal sentencing guidelines go up only to losses as high as $400 million. Madoff's confession came only after he knew his scheme was within days of collapse, Chin said.
Madoff pleaded guilty in March to securities fraud and other charges. Before the sentence was handed down, Madoff, dressed in a dark gray suit, white shirt and black tie, sat still as the victims spoke about 12 feet behind him.
When asked by the judge whether he had anything to say, Madoff slowly stood, leaned forward on the defense table and spoke in a monotone for about 10 minutes. At various times, he referred to his monumental fraud as a "problem," "an error of judgment" and "a tragic mistake."
He claimed he and his wife were tormented, saying she "cries herself to sleep every night, knowing all the pain and suffering I have caused," he said. "That's something I live with, as well."
He then looked at the victims lining the first row of the gallery. "I will turn and face you," he said mechanically. "I'm sorry. I know that doesn't help you."
His wife, Ruth, in her first public statement since the fraud unraveled, said she, too, was a victim.
"The man who committed this horrible fraud is not the man whom I have known for all these years," she said. "In the end, to say that I feel devastated for the many whom my husband has destroyed is truly inadequate."
On Friday, Chin issued a preliminary $171 billion forfeiture order stripping Madoff of all his personal property, including real estate, investments, and $80 million in assets Ruth Madoff had claimed were hers. The order left her with $2.5 million that couldn't be tied to the fraud.
Before Madoff became a symbol of Wall Street greed, he earned a reputation as a trusted money manager with a Midas touch. Even as the market fluctuated, clients enjoyed double-digit returns.
Information from the Associated Press was used in this report.
By the numbers
Amount of the fraud. This is the amount Madoff told his victims they had in their accounts, culled from fictitious statements from the firm.
The actual loss, a conservative estimate according to the judge.
Amount the Securities Investor Protection Corporation, the government-chartered insurance agency, has recovered to pay back victims.