Judge Refuses to Revoke Bernard Madoff's Bond

U.S. U.S. Magistrate Judge Ronald Ellis has issued a 22 page opinion (available here) refusing to revoke Bernard Madoff's bond. ABC News has this report. It's a really good opinion. And, I think, the correct ruling. As the Court notes (from the opinion):

Generally, a court must release a defendant on bail on the least restrictive condition or combination of conditions that will reasonably assure the defendant’s appearance when required and the safety of the community. See 18 U.S.C. § 3142[c](1)(B). The issue at this stage of the criminal proceedings is not whether Madoff has been charged in perhaps the largest Ponzi scheme ever, nor whether Madoff’s alleged actions should result in his widespread disapprobation by the public, nor even what is appropriate punishment after conviction.

The legal issue before the Court is whether the Government has carried its burden of demonstrating that no condition or combination of conditions can be set that will reasonably assure Madoff’s appearance and protect the community from danger. 18 U.S.C. § 3142(e).


As to revoking bond, once granted, the test is:

Thus, under the Bail Reform Act, the Government must first establish by a preponderance of the evidence that the new circumstances presented in this application demonstrate that there is a serious risk that Madoff will flee or that there is a serious risk that he will obstruct or attempt to obstruct justice.

The Government alleged these factors:

1) the scope and nature of the alleged crime; 2) the attendant probability that the applicable Sentencing Guidelines in the circumstance of a conviction will likely result in an advisory range at the top of the Guidelines; 3) the fact that Madoff has assets that cannot be effectively restrained; 4) the severance of Madoff’s ties to New York to such an extent that only his wife and brother are willing to sign his bond; and 5) finally, Madoff’s recent act of distributing valuable personal property to third parties.

The Court says 1, 2 and 4 are not new factors, and 3 and 5 are part of the same argument. It reminds the Government that the issue is not whether there is any risk of flight at all:

The Act does not require that the risk be zero, but that conditions imposed “reasonably assure” appearance. The Government points to the unprecedented nature of the charges in this case. However, the conditions imposed for release are unique in their own right, and appear reasonably calculated to assure Madoff’s appearance when required.

...Given that the Government 1) has conceded that the flight risk has been “substantially diminished” with the current conditions of release and 2) is constrained to the mere contention that the flight risk is not “zero,” this Court finds that the Government has failed to carry its burden of showing by a preponderance of the evidence that Madoff presents a serious risk of flight. (Tr. at 22.)

The Court then addresses the obstruction of justice argument.

The question of whether Madoff’s distribution of assets, whether characterized as “sentimental effects” (Def. Opp. at 10) or “$1 million worth of valuable property” (Gov. Mem. at 8), constitutes a serious risk of obstruction of justice is a threshold question in the inquiry in this matter. The Bail Reform Act “does not permit detention on the basis of dangerousness in the absence of risk of flight . . . [or] obstruction of justice . . . .” United States v. Friedman, 837 F.2d 48, 49 (2d Cir. 1988).

While the Parties’ positions each seem to have some merit with respect to the definition of “obstruction,” what constitutes obstruction only propels the Government halfway to its objective. The question is not simply whether Madoff’s actions can be considered obstruction, but whether there is a serious risk of obstruction in the future. The statute, by its nature, is always looking forward.

In other words,

While substantial questions remain as to whether the Government has met its burden of showing that Madoff poses a serious risk of obstruction of justice, the Court does not find it necessary to resolve this issue in order to decide the Government’s application. As set forth below, even if there were obstruction, and even if there remains potential for obstruction in the future, the Government has failed to demonstrate that no conditions can be set to reasonably protect the community from this form of obstruction.

The Court addresses and rejects the Government's argument that Madoff presents a risk of economic harm that jeopardizes the safety of the community.

Here, the Government fails to provide sufficient evidence that any potential future dissemination of Madoff’s assets would rise to the level of an economic harm cognizable under § 3142 of the Bail Reform Act. Further, it is far too great an extension to reach from the cases presented by the Government that narrowly recognize the possibility of economic harm (and rarely conclude the economic harm presented rises to the level of a danger to the community for which someone should be detained) to such a conclusion based on the minimal evidence presented here by the Government.

Madoff's arguments were:

Madoff responds by describing his current state of affairs, including 24 hour-a-day confinement; no access to any bank account held by him, his wife, or joint accounts; his real property in the United States pledged as collateral for the personal recognizance bond he executed as part of his bail;15 and his name, face and circumstance known to every financial institution in the world. (Def.’s Mem. at 7.) Further, Madoff notes that since the entry of his current bail conditions, his wife has voluntarily consented to a restraint agreement with the United States Attorney’s Office that prohibits her dissemination of any of her personal property. Finally, Madoff provides suggestions for further methods to secure any valuable portable property without the need for his detention. (Def.’s Mem. at 10, 17.)


The Government has failed to meet the additional burden of proving by clear and convincing evidence that there is no condition or combination of conditions that will reasonably prevent dissipation of such property. See 18 U.S.C. § 3142(e). In fact, its failure to respond to the various additional bail conditions presented by Madoff further supports the weakness of its argument and its inability to show why Madoff’s detention would markedly ameliorate any alleged danger to the community that may result from dissipation of his assets.

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  • Display: Sort:
    While being legally illiterate, I feel the (5.00 / 1) (#2)
    by Amiss on Mon Jan 12, 2009 at 12:25:58 PM EST
    ruling was "right" but his being out to live in his luxurious penthouse while poor black men must be confined to jail just sends the wrong message, one that says "if you are rich and white, you can skip jail, but if you are poor and black, tuff"

    Exactly right! (none / 0) (#4)
    by pmj6 on Mon Jan 12, 2009 at 12:27:51 PM EST
    skip jail? (none / 0) (#18)
    by txpublicdefender on Mon Jan 12, 2009 at 04:09:13 PM EST
    I'm sure he will go to jail eventually, but it will be after he is actually convicted, which is fine with me.  The poor always get screwed when it comes to bail because if you or your friends or family have money to post bail, you can be on the outside while awaiting trial, but if you are poor, you sit in prison until your case is heard.  And it really has nothing to do with being black or white--it's about poor and not poor.  I had plenty of poor, white clients who couldn't post a $500 bond and had to sit in jail to await their misdemeanor theft trial.  

    Not in the federal system (none / 0) (#21)
    by Jeralyn on Tue Jan 13, 2009 at 09:52:07 AM EST
    The Feds have pre-trial detention, where the government can ask for no bond if certain crimes are charged. Should the court determine bond is appropriate after a detention hearing, it must set an amount the defendant can meet.

    This is stupid (5.00 / 2) (#3)
    by pmj6 on Mon Jan 12, 2009 at 12:27:03 PM EST
    Finally, Madoff provides suggestions for further methods to secure any valuable portable property without the need for his detention.

    Yes, the fox will now help you secure the henhouse and ensure no additional hens are harmed...

    It's good to be a rich crook.

    I like that the defendent (none / 0) (#5)
    by Amiss on Mon Jan 12, 2009 at 12:35:34 PM EST
    "provides the suggestions". BTW how much is it going to cost taxpayers for a 24/hr. a day guard for him?

    Could they stick him with the bill? (none / 0) (#13)
    by nycstray on Mon Jan 12, 2009 at 02:27:29 PM EST
    Kinda like they did with making Vick pay for the care and sheltering of the surviving dogs?

    That's good defense work (none / 0) (#22)
    by Jeralyn on Tue Jan 13, 2009 at 09:57:33 AM EST
    I always provide the court with suggested conditions. The test is whether there are conditions of release that would reasonably assure both the appearance of the defendant at future court proceedings and the safety of the community. Detention is only to be ordered if there are no conditions or combination of conditions that would do both. The statute lists some conditions to consider but the court is free to consider others.

    So we propose combinations of conditions that would meet the test.

    Pre-trial detention should be the exception, not the rule. There is a presumption for certain crimes, for example, drug crimes carrying a possible sentence of 10 years or more (almost all of them), that the defendant is both a flight risk and a danger to the community. The defendant must produce some evidence to overcome the presumption. Part of that is to show there are a combination of conditions, some monetary, some not, to overcome the presumption.


    Flight risk (5.00 / 2) (#6)
    by joanneleon on Mon Jan 12, 2009 at 12:49:57 PM EST
    It's too bad the government couldn't convince the judge that he is a flight risk.  IMHO, they should have made a better argument for it the first time around, but given a second chance, apparently they still couldn't make a convincing argument.

    Although they say that he has only a few people willing to sign his bond now, I find it hard to believe that he couldn't find people to help him flee the country.  I believe that there is a big risk that he will, or that he is highly likely to do something to assure that he will not do jail time.  Not only that, but I also think that every time he steps out of his apartment, he is probably in great danger.

    Well, whatever.  The whole thing makes our system of justice look really bad.  It's hard not to speculate about how a "lesser" person would be treated.  

    I can not even begin (none / 0) (#10)
    by Amiss on Mon Jan 12, 2009 at 02:07:07 PM EST
    to feel how badly some of these people with enough money to be "accepted" into his "investments" or the charities that he completely bankrupt feel everytime they see him outside of his apartment.

    One female hedgefund operator has "gone underground" out of fear for her life as many of her customers were Russian.

    I really wonder how his antics will affect what goes on in Israel now.


    i was thinking the very same thing: (5.00 / 2) (#7)
    by cpinva on Mon Jan 12, 2009 at 01:04:59 PM EST
    Not only that, but I also think that every time he steps out of his apartment, he is probably in great danger.

    considering the number of people he's injured, you know there's at least one crazy enough to try and do something stupid.

    i would think it would be in mr. madoff's interests to not be out on the loose.

    We had a strange (none / 0) (#8)
    by Fabian on Mon Jan 12, 2009 at 01:19:43 PM EST
    set of serial crimes.

    A man robbed payday lender stores, tie up the employees and sexually assault them before leaving.  A suspect is in custody - but why choose payday lenders and why assault the employees?

    Three people have committed suicide in connection with financial crises.  One person may have retaliated against payday lenders.  There have been more than one type of threats against banks.  Isolated incidents or trends?


    Someone once said (none / 0) (#16)
    by Fabian on Mon Jan 12, 2009 at 03:19:30 PM EST
    The most dangerous people are the ones who (think that they) have nothing left to lose and those who have everything to lose.

    That's why depression is so dangerous.  Suicide is bad.  Murder-suicide is worse.


    I bet Rezko wishes he (5.00 / 1) (#14)
    by oculus on Mon Jan 12, 2009 at 02:39:50 PM EST
    Had such an unflappable judge.

    Unfortunately, (none / 0) (#1)
    by Radix on Mon Jan 12, 2009 at 12:23:36 PM EST
    being a deek isn't a bond revocable offense.

    He sounds like the classic con (none / 0) (#9)
    by jondee on Mon Jan 12, 2009 at 01:26:07 PM EST
    who took people in with their own greed.

    The best con artists (none / 0) (#15)
    by Fabian on Mon Jan 12, 2009 at 03:15:51 PM EST
    don't get caught.

    But between greed and ego, I expect most do.  

    The smart ones become CEOs and do it all legally.


    I disagree (none / 0) (#11)
    by jhiestand on Mon Jan 12, 2009 at 02:24:19 PM EST
    I think people like Madoff should go to prison for years and years.  In fact if I believed in capital punishment, Madoff would be a candidate.  A person robs a bank and spends 10-15 years in prison, but Madoff destroys lives as does Enron people like Jeff Skilling and they spend some time in a minimum security prison.  As for me they should die there for all the destruction they have done.

    "some time"? (none / 0) (#19)
    by txpublicdefender on Mon Jan 12, 2009 at 04:11:25 PM EST
    Jeff Skilling of Enron was sentenced to 24 years in prison (although his sentence was recently reversed and he'll get a new sentencing hearing); Bernie Ebbers of WorldCom got 25 years.  The big-time white collar guys are getting hefty sentences these days.

    Exactly, these sentences are way too long (none / 0) (#23)
    by Jeralyn on Tue Jan 13, 2009 at 09:59:03 AM EST
    Good Decision (none / 0) (#12)
    by squeaky on Mon Jan 12, 2009 at 02:27:00 PM EST
    As much as I would like to see the guy in prison, this is how our legal system should work all the time. Too bad it doesn't work so well much of the time particularly when a defendant is poor.

    Yeah.... (none / 0) (#17)
    by kdog on Mon Jan 12, 2009 at 04:01:45 PM EST
    Instead of saying "lock up the rich dude", maybe we should be saying "let the poor dudes out".

    They are all innocent until proven guilty, and innocent men and women should not be in cages, period.


    'splain this.... (none / 0) (#20)
    by jimakaPPJ on Mon Jan 12, 2009 at 06:46:50 PM EST
    The legal issue before the Court is whether the Government has carried its burden of demonstrating that no condition or combination of conditions can be set that will reasonably assure Madoff's appearance and protect the community from danger.

    Given that he is charged with stealing billions and given that recovery of as much possible of the stolen funds will be part of the legal effort... and given they caught him trying to mail gifts worth millions, didn't he demonstrate a violation?

    there was a question as to whether (none / 0) (#24)
    by Jeralyn on Tue Jan 13, 2009 at 10:02:14 AM EST
    he understood that to be a violation. Also, read the opinion on the difficulty of using economic harm as a standard for danger to the community.

    If he isn't likely to commit future economic crimes while on pre-trial release, I'd say he's not a danger for bond.

    Detention is not to be imposed for punitive reasons.