No guaranteed jail time for Wilmington Trust defendants


There can be no assurance that four former executives of the only financial institution to be criminally charged under the federal bank bailout program will be sentenced to jail for fraud.

But even if a judge orders jail time for the former Wilmington Trust officials upon their sentencing later this month, they will not be taken away in handcuffs.

In a filing on Thursday, prosecutors said they would not oppose the defendants’ requests to have at least two months, possibly more, to “surrender” to jail, a privilege that is not not granted to most felony defendants.

Former Wilmington Trust chairman Robert Harra Jr. and former CFO David Gibson are to be sentenced on December 17. Former credit manager William North and former controller Kevyn Rakowski will be sentenced two days later.

A federal jury convicted the four former leaders on all charges in May after a six-week trial. Prosecutors alleged that following the 2008 financial crisis, defendants misled regulators and investors about Wilmington Trust’s massive amount of delinquent commercial real estate loans before the bank was hastily sold in 2011 when it was on the verge of collapse. The century-old bank imploded despite receiving $ 330 million from the federal distressed asset relief program.

Background: Former Wilmington Trust executives convicted of 15 counts of fraud and conspiracy

According to Thursday’s court record, if U.S. District Court Judge Richard Andrews orders one of the former bank officials to be jailed, he will be allowed to report to the Prisons Office starting February 19.

“I wouldn’t characterize the delay as lenient,” said Kim Reeves, spokesperson for the US attorney’s office, of the delay given to defendants before being jailed.

Prosecutors and defense attorneys have said in court records that Harra and Gibson face 108 to 135 months in prison under federal sentencing guidelines, while North and Rakowski face 87 to 108 months behind federal sentencing guidelines. bars. But that does not necessarily mean that they will receive a prison sentence. Defense lawyers ask for probation for their clients. They are also asking that they be allowed to remain free pending resolution of their appeals, a process that could take a year or more.

Lawyers on Thursday asked the judge to be allowed to file briefs on whether the defendants should be released pending appeal, with a possible Jan. 21 hearing date for oral argument.

“We have opposed and will continue to oppose bail pending appeal,” US Attorney David Weiss said in a prepared statement. Weiss also noted that where there is no risk of flight or danger to the community, defendants are routinely allowed to report to prison themselves.

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Meanwhile, lawyers for Rakowski, 65, on Thursday filed a 60-page sentencing memorandum asking him to be given probation instead of jail time. They described her as a “relatively passive participant” in the activities that led to her conviction and said that she had lived “an honorable and law-abiding life” before that date.

Rakowski’s lawyers also cited various health issues she is facing and the recent death of her husband, who died in September after falling at home and sustaining a head injury – two weeks after writing a letter to court asking for clemency for his wife. Rakowski’s two adult daughters are also among friends and family who wrote letters on his behalf, though the girls’ letters are fully redacted in the previously sealed court record.

Pursuant to an order issued last week, lawyers for the remaining defendants have until Friday to submit redacted versions of their sentencing documents. Prosecutors objected after the documents were filed under seal, saying there is a presumption of public access to the documents.

“The supporting documents in support of the defendants’ sentencing memoranda consist largely of letters to the court written by third parties on behalf of the defendants,” prosecutors wrote in a court file. “The accused Harra, for example, attached more than a hundred letters to his sentencing memorandum, including letters submitted by current officials, former officials and other prominent Delaware.”

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