The mainstream media suggests that his 11 felony counts should spread like shrapnel to his wife and kids, and to his associates. Madoff stated in court that the businesses they ran were, "legitimate, profitable and successful in all respects." The importance of this court delivered statement is not what he said, but what his claim reveals of the prosecutorial shortcomings in his case. Evidently the prosecutors have not effectively extracted the most important information from this well-connected and very effective scoundrel. Madoff is under no obligation to cooperate since he has no deal with the state. The prosecution attempted to extract admission of conspiracy from him. This accomplished nothing, and his lawyer indicated that Madoff has accepted the fact that he will die in jail.
We have previously written on this case with The Madoff Letter, however, with Madoff's pleading concluded, we feel strongly that prosecutors should move to make him an offer that will render a maximum of the dispersed capital back to the original investors, and surface a majority of the co-conspirators hiding far beyond the circle of the Madoff family. Most importantly, an effective deal would bring the implementation of wide-ranging fixes to the regulatory cracks that continue to enable such broad abuse on the Street.
To successfully achieve these objectives, let's set aside the public fury calling for blood, and attempt to extract the highest possible benefit to society. The prosecutors may in future use his family as leverage in extracting information from him, however, with his guilty plea, Madoff has made this unlikely in the near or mid-term, and such efforts could take many years to resolve. Time will work against the prosecution in bringing satisfaction in these cases, and the last thing they should wish for is that harm comes to Madoff in prison.
Going after his family might satisfy emotions, but as such a process evolves through years of judicial wrangling, it will provide little of real value toward the principal objectives. Given that he has accepted his fate, the justice system should make Madoff a deal that would provide him some faint hope before he dies. Give him the prospect of spending some free time with his children and grandchildren before his days are over.
If billions of dollars are recovered from offshore accounts, from foreign feeder funds, and from an endless list of individuals who catered to the Madoff cash collection by accepting kickbacks, does it matter if Madoff once again sees daylight? If the long list of individuals who conspired gets rounded up to join the ranks of the incarcerated, does the greater good become advanced? If the specifics of regulatory shortcomings, and failures or incompetence of the "overseers," such as Congress and the SEC, receive unprecedented attention, and correcting legislation becomes enacted, would this not reduce future recurrences of colossal or amorphous frauds? Would the 5,000 people whose lives have been dramatically affected not welcome a significant recovery of their capital? Of course.
Make a deal Madoff will not refuse. Provide Madoff sight of the end of his tunnel. Take ego and emotions out of the equation, and make light deals with each member of his family. Exchange the leniency for a complete and specific unraveling of the past thirty years Madoff spent in the more dubious financial chambers of Wall Street, Geneva, London, Monaco or Singapore. Get all names and amounts. Then go after all of them, extraditing many from the comfort of protective jurisdictions while those countries still need all the financial goodwill they can get, and grab the cash these co-conspirators stashed as you bring them to justice on the streets of New York.
Revenge in this case would not positively serve the society Madoff abused, and he is not likely to atone for his crimes. What matters now, more than retaliation on this former NASDAQ Chairman, is the achievement of some restoration, and salvaging as much as is possible of the destruction rendered by this monstrous crime. Let his dream hold contain a whiff of freedom, as he rests uncomfortably in his new austere surroundings. Do whatever it will take for him to cough it all up.
James Raider writes The Pacific Gate Post
