Bernard Madoff may have confessed to the largest investment fraud in history, but that doesn't mean he'll get the longest white-collar sentence when he faces a federal judge on June 29.
Madoff, 71, confessed to running a $65 billion ponzi scheme that spanned decades and affected thousands of investors. He faces a statutory maximum of 150 years for the 11 counts to which he pleaded guilty in March. If judge Denny Chin decides to hand down all that time, it would still be only the fourth-longest sentence handed down in recent years to a white-collar defendant, according to an analysis by Forbes.
In any case, Madoff will almost certainly die in prison. So will Sholman Weiss, currently serving the longest federal sentence for a white-collar crime. In 2000 a Florida judge sent him away for 845 years for the $450 million collapse of National Heritage Life Insurance. Weiss was convicted and sentenced after he fled the U.S. for Austria. Later apprehended and returned, he's currently housed in a federal prison outside Scranton, Pa. The Bureau of Prisons lists his release date as Nov. 23, 2754.
His co-defendant, Keith Pound, got 740 years and ended up serving just four of them before dying in prison at the age of 51.
More recently, a federal judge in Colorado slapped a 330-year sentence on Norman Schmidt, 73, convicted of running an investment scheme through which he siphoned money to buy NASCAR race cars, a race track and other racing-related properties. He will be released Sept. 12, 2291.
Such long sentences are rare for white-collar defendants, who usually go to prison for things like fraud, money laundering and other non-violent financial crimes. They are more typical for violent offenders like Theodore Kaczynski, the Unibomber, who will sit in a supermax prison in Colorado until he dies, and Jeffrey Dahmer, the cannibal who got 957 years for killing 17 people. He was killed in prison by a fellow inmate.
"It's the violent people we need to warehouse," says Alan Ellis, a lawyer and sentencing consultant. Still, an era of scandals related to corporate accounting fraud and investment swindles has created a new fervor for example-setting. "More and more judges are citing economic danger," Ellis says.
For many white-collar criminals in middle or retirement age, the terms are essentially life sentences, since federal prisoners have to serve at least 85 per cent of their time. Bernard Ebbers, 67, convicted in 2005 for the accounting fraud that brought down WorldCom, is sitting in a federal prison in Louisiana with a release date of July 4, 2028, when he would be 85 years old.
Jeffrey Skilling, 55, of Enron fame, is in a Colorado prison serving 24 years for accounting-related fraud, though he might get out earlier if a re-sentencing hearing scheduled for July goes his way. His co-defendant, former Enron Chief Executive Ken Lay, died before he could be sentenced.
Madoff isn't likely to get much leniency even though he did confess. Many of his former customers say they lost their life savings in the scheme, others lost tens, if not hundreds, of millions of dollars. The economic damage reaches from New York society to Palm Beach and to Europe. Of $65 billion that vanished, just over $1 billion has been recovered so far. Ironically, jail may be the safest place for Madoff these days.