Legal Commentary

The WSJ law blog is reporting that lawyer-turned-fraudster Marc Dreier is scheduled to be sentenced Monday by Judge Jed Rakoff in Manhattan.  After Madoff's sentencing, Dreier's own judgment day seems anti-climactic, and perhaps that is to his benefit.

Like Madoff, Dreier's attorney (Brooklyn's own Gerald Shargel) also is asking for a sentence outside the United States Sentencing Guidelines recommended range: 12 and 1/2 years instead of 145.  Unlike Madoff's life expectancy claim, Shargel's more formalistic argument focuses on the enhancements contained in the Guidelines and attempts to substitute a significant, but less damning enhancement than the one that the Guidelines would apply based on the intended fraud amount.  Given Judge Rakoff's previous criticism of the Guideline enhancements in this previous case, that isn't a bad idea, although the the case that previously spurred Rakoff's criticisms involved a defendant who had joined an already existing conspiracy.  Dreier's fraud is all his own doing.

So, what sentence will Dreier receive? 

I'm betting it will be something substantially less than 150 years.  Unlike Bernard Madoff, Dreier has a few factors in his favor: his fraud did not last as long; his victims were entities instead of mom-and-pop investors; he has reportedly been helpful in the recovery of funds since pleading guilty; and his own children submitted moving letters on his behalf. 

By contrast, Madoff was portrayed as the epitome of evil, who bilked money from friends and charities, who attempted to send money and baubles to friends and family while out on bail, and who was perceived as covering for his wife, sons, and the employees who allegedly enabled his crime.  At the end of the day, no-one believed that Madoff was sorry or that he had disclosed the entire fraud.  Whether this was true we'll never know, but perception plays an important role at sentencing and from this vantage point, Dreier looks a lot better than Madoff.

In any event, it certainly has been quite the summer for perpetrators of spectacularly awful frauds.