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| Marc Dreier arrives at Manhattan federal court for his sentencing, Monday, July 13, 2009, in New York. The founder and former managing partner of Dreier LLP who admitted defrauding hedge funds of more than $400 million is facing a possible sentence of 145 years in prison. |
NEW YORK (AP) -- A once-prominent Manhattan attorney was sentenced Monday to 20 years in prison for a hatching a massive fraud in a brazen attempt to keep his law firm afloat and bankroll a lavish lifestyle.
Prosecutors had sought 145 years behind bars for Marc Dreier. But the judge concluded he was "no Mr. Madoff" - a reference to disgraced financier Bernard Madoff, who last month received a 150-year term.
Dreier, 59, had pleaded guilty to a seven-year, $400 million scheme that, though eclipsed by Madoff's multibillion dollar swindle, was so outlandish prosecutors labeled him "the Houdini of impersonation and false documents."
The defendant apologized before deputy U.S. marshals led him in handcuffs out a side door in a Manhattan courtroom.
"I'm sorry - deeply sorry - for the harm and sadness I've caused to so many people," he said. "I know an apology doesn't fix anything. But at this point, all I can do is express my shame and remorse."
Defense attorney Gerald Shargel had argued that between 10 and 12 1/2 years in prison would be fair punishment for a white-collar criminal who clearly "went way off the tracks." His client, he said, proved his instability by once trying to impersonate a lawyer with a pension fund for Canadian teachers while trying to close a deal on $33 million in fraudulent promissory notes.
"It was crazy for Mr. Dreier to think he could away with this," Shargel said. "It was perverse stroke of luck that he wasn't caught years earlier."
Prosecutors told U.S. District Judge Jed Rakoff that Dreier should get 145 years - consecutive maximum sentences on multiple counts - for sacrificing a "rewarding and productive life as a lawyer" for "a life of fraud" that bilked hedge funds and doomed his Park Avenue law firm.
Rakoff immediately made clear that he thought the government's request was unrealistic, saying, "Are you really asking for 145 years?"
Giving Dreier that amount of time would "demean" the sentence for Madoff, whose fraud spanned decades and victimized thousands of clients, he said. "Mr. Dreier is not going to get much sympathy from this court, but he is no Mr. Madoff under any analysis."
Before Dreier's arrest late last year, his firm had nearly 250 attorneys and a roster of clients that included retired football star Michael Strahan and former News Corp. publishing executive Judith Regan. He had spent tens of millions to decorate the firm's offices with works by Picasso and Andy Warhol, and to purchase beachfront homes on both coasts, a Mercedes and an Aston Martin, and an $18.5 million yacht.
In a letter sent to the judge last week that was rife with regret, Dreier said he was engulfed in a "quicksand of spending" that led to desperate measures - "a massive Ponzi scheme with no apparent way out."
The scheme involved cheated hedge funds, investment funds and several individual investors between 2004 and 2008 by selling them fictitious securities. The government has said Dreier received as much as $740 million from the sales and that victims lost $400 million.
To carry out the plot, prosecutors say, he supplied fake financial statements for his victims.
