Oct 10

What Not to Do Before a Federal Sentencing: Lesson Learned from the Giudices

Teresa and Joe Giudice – the reality show husband and wife duo from the show Real Housewives of New Jersey – were sentenced to jail last week after pleading guilty to federal charges for bank and wire fraud. Perhaps lost amid the media frenzy that accompanied their sentencing hearings is a practical lesson for defendants preparing for sentencing: provide full and accurate financial disclosures prior to sentencing.

Judge Esther Salas sentenced Teresa to 15 months in prison, with her sentence to begin in January 2015, and Joe Giudice was sentenced to 41 months in prison to be served consecutive to Teresa’s commitment. Judge Salas staggered their terms so that one parent can be home with their four children, and Joe’s term will start when Teresa’s ends.

During sentencing, Judge Salas revealed that she almost applied the downward departure requested by Teresa’s attorney, which would have allowed Teresa to receive probation or house arrest. So what went wrong for Teresa? Judge Salas told Teresa:

For a moment, I thought about probation until I read the government’s report. What you did in the financial disclosure really sticks in my craw. It’s what the court has a problem with. It shows blatant disrespect for the court. I’ve seen a lot but I’ve never seen the confusion and work that went into these financial documents…I need a full picture of who you are, I need a full disclosure of your financial assets. It’s not because I want to be nosy. Because of that, I don’t think you respect the laws of this country. You are not as bad as your husband, you do not have the criminal record that he has had, but you are complicit in it. Getting this financial information that I need to judge this case was like pulling teeth, it was the most difficult in all my years as a judge and as a lawyer.

Enter table flip.

If Teresa had just taken the time to do one thing properly, she wouldn’t be facing over a year in jail away from her children.   Nothing she did prior to pleading to guilty landed in her jail; it was just her simple failure to fill out her financial disclosure form accurately. What should we learn from this?

Reveal All Assets in the Financial Disclosure Form and Respond Promptly to all Government Inquiries

Prior to sentencing, the United States Probation Department requires the completion of a Monthly Cash Flow Statement and Net Worth Statement. In submitting these forms, a defendant must make a Declaration of Defendant or Offender Net Worth & Cash Flow Statements, which requires the defendant to declare under penalty of perjury that the information is correct. The submission of the form is subject to the federal false statement statute, 18 U.S.C. § 1001. Completing these forms is part of the presentencing investigation process. Pursuant to U.S.C.A. § 3552, “[a] United States probation officer shall make a presentence investigation of a defendant that is required pursuant to the provisions of Rule 32(c) of the Federal Rules of Criminal Procedure, and shall, before the imposition of sentence, report the results of the investigation to the court.”

Yet Teresa did not include the following assets in her financial disclosure form: her Milania Hair Care and Fabellini sparkling wine lines, household furnishings, a 2006 Ford F-250 truck, a cement mixer, a Bobcat trailer, a 1993 Ford Ranger, and a 1997 Chevy Corvette. These are significant assets, and some were very easy for the government to know about: after all, Teresa and Joe’s home was featured prominently on a reality show. But even for those without cameras in their living rooms (or fan clubs all over the Internet), it is just as important to reveal all assets to the government (and, in fact, a crime to withhold such information). And, if the government has any questions about your financial information, answer them promptly.

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