June 3, 2009

SENATE PASSES "MADOFF" BILL

Representative Pat Dillon (D-New Haven) hailed Senate passage of legislation she authored to target fraudulent money managers like Bernard Madoff, the New York money manager who confessed to running a $50 billion Ponzi scheme.

The bill would allow the state to seize the assets of anyone arrested for securities fraud using the state's organized crime statutes. The bill (HB 6339) was unanimously approved Tuesday night by the State Senate.

"White collar criminals leave victims in their wake just like violent criminals," Rep. Dillon said. "We must do our best to protect their victims."

In the Madoff case, the federal government seized assets, but Rep. Dillon noted the state has a role to play in future cases of fraud by financial advisors and money managers.

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, previously approved by the House, now goes to the governor for consideration.