Legal News

The Madoff Bail Decision: Not ?Governed . . . by Visceral Reaction?

By Dan Slater

When it comes to Judge Ronald Ellis’s decision to deny the prosecution’s request to jail Bernie Madoff, the prevailing mood appears to be outrage.

“It’s absolutely ludicrous that he’s not in prison,” Steven Salbe, whose family had an account with Madoff since the 1960s, told the Journal.

“Judge Ellis’s explanation is not very satisfying,” writes the New York Times, adding, “he goes on to justify his decision by essentially saying that Mr. Madoff can afford to buy his way out of the pokey.”

We here at LBHQ understand the resentment, especially from potential Madoff victims, but we’re circumspect when it comes to criticism of Ellis’s opinion.

So is Wayne State Law Prof Peter Henning, formerly of the White Collar Crime Prof blog. “The whole idea behind bail is to ensure that the defendant appears and also to impose conditions that will protect the community,” Henning told the Law Blog. “I think the magistrate judge was on pretty solid ground, as much as it drives everyone nuts. We have this darn thing called due process. And the judge followed the law.”

Henning continued: “It was a stretch to try to get his bail revoked. Unfortunately, despite what people feel, this is governed by a statute — not visceral reaction — which sets forth the requirements and the government’s burden of proof. If the magistrate had sent him to jail, I think there’s a decent chance a district court judge would’ve overturned it.” (As it stands now, Judge Ellis agreed to stay his order by two days while the government appeals.)

What about the prosecution’s apparently novel argument that dissipation of assets could constitute a kind of economic threat to the community? “The economic argument I’ve not seen in other cases,” said Henning. “White-collar defendants get out on bail. That’s pretty much how it works. I could see the argument working. If he were to somehow take action to frustrate restitution, that could be grounds for putting him in jail. But just the threat of him dissipating assets, when the government is watching him, that’s a tough case to make.”

Full post as published by Law Blog - WSJ.com on January 13, 2009 (boomark / email).