United States v. Butler, No. 08-CR-370 (JBW), 2010 WL 318087 (E.D.N.Y. Jan. 22, 2010)
On August 19, 2009, Eric Butler was convicted by jury verdict of all counts of a three-count superseding indictment. His trial laid bare the pernicious and pervasive culture of corruption in the financial services industry. The blame for this condition is shsared not only by the individual defendants like Butler, but also by the institutions that employ them, those who carelessly invest, and those who fail to regulate. Supervision is seriously negligent; greed and short-term gain are so enormous that fraud and arrogant disregard for others' rights and of ethics almost encourage criminal activities such as defendant's.
Not the most auspicious beginning. But the story has a "happy" ending.
The Government contended that Butler faced an advisory Guidelines range of life imprisonment, and a statutory maximum of 45 years. It requested a sentence of at least 15 years, and restitution of approximately $1.1 billion. The Court didn't buy the Government's argument. Instead, the district court found (working with an advisory panel of other judges and a sentencing expert from the Probation Department) that the losses associated with Butler's offense were "impossible to determine." Accordingly, it calculated his advisory Guidelines offense level based on the amount of proven gain resulting from his offense. Bottom line, the district court determined that Butler faced an advisory Guidelines range of imprisonment of between 87 and 108, and then sentenced him to 60 months imprisonment. More specifically, it found that:
The extent of loss to Butler's clients, if any, could not be calculated, in part because the investors defrauded were able to hold securities purchased through Butler that were impaired, but that might in time prove to possess some or all of the value of the original investment.
The district court then imposed the non-Guidelines sentence for two primary reasons (other than its conclusions concerning loss). First, "defendant's young child and loving wife suggest the desirability of defendant's early presence at home, working and supporting his family economically and psychologically." Second, "a strong supportive network of extended family, friends, teachers, and potential employers, as well as defendant's positive reaction to supervision since his arrest, indicate a high probability of rehabilitation."