Tuesday, 7 July 2015
Last updated 46 min ago
Oct 22 2010 | 1:56pm ET
U.S. District Judge John Koeltl appears to be a believer in poetic justice.
The federal judge yesterday sentenced Ponzi schemer Arthur Nadel to 14 years in prison—a term that amounts to 168 months, or one month for each of the $168 million of his scam. If Nadel, whose lawyers say he is an "old, frail human being who does not have very much longer to live," survives the full sentence, he will by 91 years old when he is released.
Mark Gombiner, Nadel's lawyer who had sought a five year sentence, said Koeltl "basically imposed a life sentence on Mr. Nadel."
Prosecutors, who alleged that at least some of Nadel's victims had trusted him due to the very physical frailties that his own lawyers hoped would win him a reduced sentence, had sought a jail term of at least 19½ years in prison.
At the sentencing hearing, Nadel said, "I blame no one but myself for my actions."
"I have been my own worst enemy," he added. "I have thrown away everything worth living for."
Those words did not assuage one of his victims, Michael Sullivan, who called Nadel an "evil person" at the hearing.
Nadel pleaded guilty to 15 counts of securities, wire and mail fraud in February. In addition to the prison term, Koeltl also ordered Nadel to forfeit $162 million.
Prosecutors this week also answered Nadel's allegation that his business partners, Christopher and Neil Moody, on whose behalf he ran three of the six hedge funds that made up the Ponzi scheme, were getting away with their role in the fraud.
In response to a court filing earlier this week seeking leniency for Nadel because of the unpunished role of the Moodys, prosecutors said that Nadel "did not have any evidence that either Neil Moody or Chris Moody knew about Nadel's fraudulent schemes." The Moodys have been sued by the SEC, but not criminal charged.
"The government does not believe that Nadel's statements relating to the extent, duration and involvement of other participants in the fraudulent scheme should be credited in any way—particularly given his long history of fraud and lies," assistant U.S. Attorney Reed Brodsky wrote.
In any event, even if Nadel were telling the truth, that would actually merit a longer sentence, because it would amount to an admission of a criminal conspiracy.
"To the extent this court considers Nadel's argument that others were involved with him, the court should find that a severe term of imprisonment is required for the additional reason that Nadel was a leader of criminal activity," Brodsky wrote.
May 27 2015 | 2:15pm ET
Support Hedge Funds Care, also known as Help For Children (HFC), by participating in this year's raffle. All proceeds go to support HFC's mission of preventing and treating child abuse. Read more…