FOR SHOLAM WEISS
845 YEAR SENTENCE IN 2000
37 MONTHS SENTENCE TODAY (2018)
Sentencing Sholam Weiss in 2000
During sentencing, the district court found that Sholam Weiss was personally responsible for money laundering involving $100 million, with “losses or intended losses” of $125 million to National Heritage. Restitution, based on the losses, was set at $125 million and he was sentenced to 845 based on the mandatory sentencing guidelines. (See, the United States v. Booker)
Sentencing after 2001 (sentencing guidelines changed)
If Sholam Weiss were to be convicted of the same offenses today, his sentence would be calculated by different guideline standards than the guidelines used during his sentencing in 1999.
In 2001 Congress has recognized that the previous sentencing guidelines standards have caused inconsistencies in sentencing and has cause inhuman sentences to some individual offenders. In 2001 Congress has changed the way sentencing should be viewed and calculated.
If Sholam Weiss were to be convicted of the same offenses today, his sentence would be calculated by different guidelines than what was used during his sentencing in 1999. United States Sentencing Guidelines (USSG) §2S1.1(a)(1), which became effective November 1, 2015, provides that the base offense level for money laundering is the "offense level for the underlying offense from which the laundered funds were derived." In this case, the underlying offenses from which the laundered funds were derived are wire fraud (18 U.S.C.1343) and transportation of stolen goods (18 U.S.C.1314)
All of Sholam Weiss’ co-defendants are either dead or released from prison. According to the Bureau of Prisons website, Jan Star was released on January 1, 2005; Jan Schneiderman was released on February 23, 2011 and Keith Pound is designated as deceased as of July 7, 2003.
Patrick Smythe, Michael Blutrich and Lyle Pfeffer were the primary contributors to the insurance company’s financial ruin.
Smythe, Pfeffer and Blutrich – the original organizers of the scheme and the architects of all that occurred – pleaded guilty to racketeering, racketeering conspiracy, money laundering, and wire fraud. Smythe also pleaded guilty to tax evasion. Despite their principal responsibility for the fraud, Smythe, who was convicted of 90 criminal counts, received a reduced sentence of 150 months for his cooperation.
Pfeffer and Blutrich, who were also convicted of 90 counts, as well as separate criminal charges unrelated to the National Heritage case (on mob related offences and sex offenses), received reduced sentences of 200 months in their combined plea agreements (See, NY Times article Aug 30,1998). By contrast, Sholam Weiss’ was convicted of 76 counts, was not an officer of National Heritage, and was not an original organizer of the crime, and was not sentenced for crimes other than those connected to National Heritage received 845 year sentence.
Patrick Smythe was released on August 21, 2009. Blutrich and Pfeffer have both been released, although the exact dates are not available because they have been shielded by the federal witness protection program due to their assistance in prosecuting persons in organized crime (unrelated to Sholam Weiss)
SENTENCING WITH OTHER WHITE COLLAR CRIMES
Sholam Weiss is serving an 835-year sentence for his role in a fraudulent scheme that caused no actual loss to National Heritage with regards to his involvment. As stated in ABOUT, at the time of sentencing, the Receiver recovered 65 million dollars (See. PSR 74), and much more has been recovered since that time, resulting in no actual loss, but a profit. By contrast, Jeffrey Skilling was sentenced in June 2013 to 14 years for his role in a fraudulent scheme that caused Enron victims a loss in excess of seven billion dollars. Sholam Weiss' sentence is nearly 60 times longer than Mr. Skilling's despite the fact that the $125 million dollar intended loss estimate is less than 2% of the actual loss in Enron. Thus Sholam Weiss received a sentence that was 3600 times greater per dollar loss than Skilling.
Other cases exemplifying similar disparity include: Sanjay Kumar, who received a 12-year sentence involving losses of 2.2 billion; Bernard Ebbers, who received a 25-year sentence involving losses of 100 billion dollars; John Riggs and Timothy, who received 15 and 20-years respectively for stealing 100 million dollars, and causing the losses of over a billion dollars; and Walter Forbes, who received a 12 ½-year sentence for losses of approximately 14 billion dollars.
Sholam Weiss was a small-time businessman-turned business consultant. He does not have a college level education, was not an officer of National Heritage, and became associated with National Heritage only after the principals in the company had already embezzled $35 million and, together with bad investment decisions, put the company into financial crises. Even without Sholam Weiss’ involvement, National Heritage would have collapsed.