May 29, 2009

LEGISLATION TARGETING FRAUDULENT MONEY MANAGERS
GETS UNANIMOUS SUPPORT IN HOUSE

Representative Pat Dillon (D-New Haven) led House debate on legislation that would allow the state to seize the assets of anyone arrested for securities fraud. The bill (HB 6339) was unanimously approved Wednesday night by the House of Representatives.

"This legislation makes it clear that white collar criminals are thieves, and should be treated as thieves," Rep. Dillon said. "The Bernie Madoffs of the world would have their ill-gotten wealth seized by the state, giving victims some hope of restitution."

Rep. Dillon authored the legislation after hearing stories of the many Connecticut victims of Bernard Madoff, the New York money manager who confessed to running a $50 billion Ponzi scheme. Federal authorities have seized Madoff's assets, but Rep. Dillon noted the state has a role to play in future cases of fraud.

The legislation expands the state's organized crime statute, Corrupt Organizations and Racketeering Act (CORA), to target fraudulent activity by money managers. CORA provides for the imposition of stiffer criminal penalties for white-collar criminals, including lengthier prison sentences and fines of up to $25, 000, as well as the forfeiture to the state of money or property obtained by criminal means.

The bill awaits action by the State Senate.