Gillen Withers & Lake LLC has launched a new website at http://twitherslaw.com/. The site lists many of the notable successes which the firm has had in its history. We would like to thank our readers and encourage them to take a look at the new site.
As reported by Law.com, the sentencing of celebrity attorney and Ponzi schemer Marc Dreier is scheduled for next Monday, July 13. Dreier was arrested last December for defrauding investors and clients of more than $740 million through a series of schemes. A full history of the Dreier saga is set forth here. He pled guilty on May 11 to one count of conspiracy to commit securities fraud and wire fraud, one count of money laundering, one count of securities fraud and five counts of wire fraud and has remained under house arrest in his luxury apartment in Manhattan.
Dreier's attorney, Gerald L. Shargel, filed a sentencing memorandum on Tuesday requesting a sentence for Dreier of between 10 years and 12 years and 7 months. Shargal asserted that Dreier has already started to be punished through his public disgrace, the loss of his law firm and possession, and "the shame and suffering that his actions have brought upon his family."
However, the prosecution, headed by Assistant U.S. Attorney Jonathan R. Streeter, has filed a sentencing memorandum aiming for a higher sentence for Dreier--145 years in prison, or, in the alternative, "a term of years that would both assure that Dreier will remain in prison for life and emphatically promote general deterrence."
The government's recommended sentence for Dreier is a mere 5 years less than the 150 year sentence imposed two weeks ago on the largest Ponzi scheme fraudster in history, Bernard Madoff (as massive as Dreier's crimes were, Madoff defrauded investors of exponentially more money). Dreier is currently 59. The proposed 145 years aside (and 145 years before his sentencing date--June 13, 1864--Ulysses S. Grant and Robert E. Lee had just concluded one of the bloodiest battles in American history at Cold Harbor, Virginia) any sentence imposed by the Court is all but guaranteed to ensure that Dreier spends the rest of his life behind bars. Although Drier's fraud, as massive as it is, is only a small fraction of the damage caused by Madoff, the record for a white collar criminal sentence is actually 845 years, imposed on Shalom Weiss in 2000 for a $450 million mortgage and insurance scheme against Florida pensioners (to be eligible for release today, even counting "good time," Weiss would have had to have started his sentence in 1290--the year Edward I of England passed the statute of Quia Emptores, which reformed the feudal land system). You can enjoy Money Central's list of the ten longest white-collar criminal sentences here.
Supreme Court Justice David Hackett Souter has announced his intention to retire at the end of the Court’s term in June. In his 19 years on the Court, Justice Souter has been a key vote in many cases and has written over 150 majority, plurality, concurring and dissenting opinions, including in many criminal cases. In the area of criminal law, Justice Souter has issued numerous opinions fairly consistently advancing the rights of defendants at all stages of criminal proceedings. Federal Criminal Defense Blog salutes Justice Souter and his highly distinguished tenure on the Court by listing some of his significant opinions in the criminal arena, beginning today with majority and plurality opinions.
Criminal defense attorneys everywhere will be familiar with Kyles v. Whitley, 514 U.S. 419 (1995) in which the Court, in an opinion delivered by Justice Souter, reversed the defendant’s conviction and held that a state prosecutor has a duty to learn of any favorable evidence known to the others acting on the government's behalf in the case, including the police, and has a duty to turn over all exculpatory evidence to the defense, pursuant to Brady v. Maryland, 373 U.S. 83 (1963). And in Missouri v. Seibert, 542 U.S. 600 (2004), Justice Souter authored a majority opinion holding that warnings pursuant to Miranda v. Arizona, 384 U.S. 436 (1966) given to a defendant in the middle of an interrogation are ineffective and any statements given during the interrogation are inadmissible. And in Corley v. U.S., 129 S.Ct. 1558 (2009) discussed on this Blog, Justice Souter delivered the majority’s opinion that 18 U.S.C. § 3501 does not alter the rule that confessions made during periods of detention which violate the prompt presentment requirements of Federal Rule of Criminal Procedure 5(a) are inadmissible pursuant to the rule of McNabb v. United States, 318 U.S. 332 (1943) and Mallory v. United States, 354 U.S. 449 (1957).
Justice Souter had Georgia on his mind early in his career on the Court when he delivered the unanimous opinion for the Court in Ford v. Georgia, 498 U.S. 411 (1991), in which the majority held that the Georgia Supreme Court erred in concluding that the petitioner’s claim pursuant to Batson v. Kentucky, 476 U.S. 79 (1986), which prohibits racially-based exercise of peremptory challenges by the prosecution, was untimely pursuant to State v. Sparks, 257 Ga. 97, 98, 355 S.E.2d 658, 659 (1987), in which the Georgia Supreme Court held that a Batson objection must be made within the period of the jurors’ selection and the administration of their oaths, because the Sparks rule was not “firmly established and regularly followed” at the time of the petitioner’s trial. In Wade v. U.S., 504 U.S. 181 (1992), Justice Souter, again writing for a unanimous Court, held that federal district courts have the authority to review the government’s refusal to file a substantial-assistance motion and to grant a remedy if they find that the refusal was based on an unconstitutional motive. Justice Souter authored the majority opinion in Old Chief v. U.S., 519 U.S. 172 (1997), in which the Court reversed the petitioner’s conviction for possession of a firearm by anyone with a prior felony conviction in violation of 18 U.S.C. § 922(g)(1), holding that a district court abuses its discretion where it refuses a defendant’s offer to concede a prior judgment under Federal Rule of Evidence 403 and admits the full judgment over the defendant’s objection. In Shepard v. U.S., 544 U.S. 13 (2005) he wrote a majority opinion holding that in applying the Armed Career Criminal Act, 18 U.S.C.A. § 924(e), a sentencing courtcannot look to police reports or complaint applications to determine whether an earlier guilty plea necessarily admits, and supports a conviction for, generic burglary. Justice Souter wrote the majority’s holding in Watson v. U.S., 128 S.Ct. 579 (2007) that a person who trades drugs for a gun does not receive the gun in violation of 18 U.S.C. § 924(c)(1)(A), which provides for a mandatory minimum sentence where a defendant uses a firearm during a drug trafficking crime.
Less pro-defense, Justice Souter authored the majority opinion in U.S. v. Wells, 519 U.S. 482 (1997) which held that material of falsehood was not an element of making false statements to a federally insured bank under 18 U.S.C. § 1014. And he rejected the petitioner’s arguments that 18 U.S.C. § 666(a)(2), which proscribes bribery of State and local officials of entities, was unconstitutional because of a lack of any jurisdictional requirement of a connection to federal money in Sabri v. U.S., 541 U.S. 600 (2004), holding that the statute was an instance of necessary and proper legislation.
Yet another Ponzi scheme has surfaced in Georgia. As reported by the Macon telegraph his past Tuesday, U.S. marshals in Denver arrested Gary Hutcheson and Saundra McKinney Pyles of Macon. Hutcheson and Pyles had been indicted on April 22 in the U.S. District Court for the Middle District of Georgia on five counts of mail fraud and five counts of money laundering for running a fraudulent investment operation. The Indictment alleges that, beginning in 2006, Hutcheson operated a business named Georgia Ionics Fund LLC, which used two securities brokers, CyberTrade Inc. and Cobra Trading, to handle investments. Hutcheson is alleged to have advertised a hedge fund and claimed to have investment expertise and successes, which was false. Hutcheson attracted more than $2.1 million from investors, and invested only $780,000 of the money, the majority of which was lost. He kept approximately $1.3 million. Hutcheson further falsely represented to investors that the fund was completely successful. He and Pyles paid $457,000 of the funds to certain investors, falsely claiming that the funds constituted investment profits. Hutcheson and Pyles are awaiting extradition back to Georgia.
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