SEC: Merrill’s guilty plea “not accepted” by court (TelexFree)
This came as a bit of a surprise…
On October 24th James Merrill plead guilty to guilty to eight counts of wire fraud and one count of conspiracy to commit wire fraud.
The charges stemmed from Merrill’s involvement in running TelexFree, a $3 billion dollar Ponzi scheme.
As per a Status Report fled by the SEC on October 25th, turns out the court did not accept Merrill’s plea.
As per the SEC’s report;
The Court did not accept Merrill’s guilty plea at that time and has scheduled sentencing for February 2, 2017.
The scheduling of a sentencing hearing to me suggests the plea has been accepted, otherwise how can you sentence someone who hasn’t been found guilty (via plea or otherwise)?
Perhaps one of our more legally minded readers can explain?
The SEC’s report also provides the current situation on Carlos Wanzeler, Merrill’s partner in crime.
The other criminal defendant, Carlos Wanzeler, fled to Brazil upon learning of the federal charges filed against him where he remains.
There is currently still a federal warrant for his arrest.
As pointed out by Patrick Pretty, Merrill’s guilty plea compels him to fully cooperate with Brazilian authorities.
If Brazil’s Federal Police wish to ask him about TelexFree’s involvement in wire fraud and an underlying conspiracy, James Merrill is required to provide a “complete and truthful proffer,” according to the terms of his plea agreement with U.S. prosecutors in Massachusetts.
It’s no secret that Brazilian authorities are building a case against Wanzeler. After Merrill’s plea is formally accepted and he’s sentenced, I suspect we’ll see action taken against Wanzeler over the next year or so.
Whether he’s ultimately prosecuted in Brazil or the US remains to be seen.
Footnote: Our thanks to Don@ASDUpdates for providing a copy of the SEC’s Status Report, filed October 25th.
this ^^ means that the court has not agreed to the ‘terms and conditions’ of the plea.
plea agreements will usually have the dropping of some counts and the recommendation of a sentence.
in merrill’s case he plead guilty to counts 1 to 9, and counts 10 to 17 were dropped. the plea recommended a sentence of less than 10 years.
the court may have refused to accept either of both of these ‘conditions’.
usually in federal courts plea agreements are ‘non -binding’. this means that if the court does not accept a guilty plea, the defendant does not have the right to withdraw his plea.
so, the court has rejected the plea agreement, merrill cannot go back on his guilty plea, and the court will move ahead to sentence him according to the judge’s view.
i think merrill will get a higher sentence than the 10 years recommended in the plea deal.
finchmccranie.com/table-of-contents-3/v-plea-bargaining/a-plea-bargaining-and-rule-11/
You reckon?
It’s all a bit ambiguous to me. I figured the sentencing hearing was an acceptance of the plea.
I figured the plea had to be accepted as a whole or rejected. Guess that’s not the case.
i tried to read around a bit and the best i can come up with is:
– if this plea agreement was ‘non binding’ then the judge can reject the recommendations of the agreement and pronounce his own sentencing. the defendant cannot ‘withdraw’ his guilty plea but can only appeal this sentence.
example:
patrickpretty.com/2011/09/10/bulletin-appeals-court-upholds-federal-judge-who-departed-from-sentencing-guidelines-and-prosecutions-recommendation-and-imposed-maximum-prison-term-on-louisiana-ponzi-schemer/
– if the plea agreement was ‘binding’ and the judge rejects it then the defendant can either accept the judge’s sentencing or rework the plea agreement [with the prosecution] or withdraw the guilty plea and opt for a trial.
eg:
latimes.com/local/lanow/la-me-ln-baca-sentencing-20160718-snap-story.html
i don’t know whether merrill’s plea deal was binding or non-binding, but the judge scheduling a sentencing date indicates it may have been non binding.
The Judge can certainly impose his or her own sentence, it even says that in the proposed plea.
However any sentencing would require the court to accept the plea first no?
I thought sentencing and a guilty plea were two different things, in that you can’t have the former without acceptance of the latter first.
NO LINK: nolo.com/legal-encyclopedia/can-the-judge-reject-plea-deal.html
I suggest this is tantamount to the judge telling the parties to try again and come back in a couple of months.
I believe the parties will submit a reworked plea deal to the judge weeks before Feb 2, 2017, and the judge will either accept or deny a reworked deal.
Eventually (even if not this round) Merril will make a deal that the judge is willing to approve or he (and the DA) will be forced into a trial on all or multiple counts. The judge is pressuring them here.
I don’t think anyone is bound to anything at this point but Merrill has gotten a glimpse of a cold reality. The prosecutor will be demanding more from him. That is what the judge seems to be demanding.
Yes I think they will try to submit a revised plea bargain.
If that’s the case then it’s great to see a Judge go hard-ass on a Ponzi scammer. Hopefully this becomes a trend.
in the way the 24th oct guilty plea hearing has been reported on by the press, there is no indication that judge hillman did not accept merrill’s plea.
a judge refusing to accept a guilty plea is an uncommon occurrence and would have been widely reported.
there is a good chance the SEC has made a typo in it’s status report.
for example this is coverage from metro daily news:
metrowestdailynews.com/news/20161024/ashland-man-pleads-guilty-in-telexfree-case