Opinion ID: 2708859
Heading Depth: 1
Heading Rank: 3

Heading: The Sentencing Decision

Text: Castaldi submitted a detailed sentencing memorandum with supporting evidence and letters. He argued for a belowguideline sentence of 100 months. He based this argument on several arguments in mitigation, including the circumstances of the offense (Castaldi in effect inherited the Ponzi scheme from his father and convinced himself he had to keep it going to protect his father); his lack of intent to cause harm; the absence of a greedy or lavish lifestyle; his extraordinary cooperation by voluntarily disclosing the scheme and laying out the details for the government without assurances of leniency; his wife’s serious health problems; his own age (then 57 years old) and health problems; and numerous letters from family and friends attesting to his good character and genuine remorse. The government’s memorandum was much shorter. It urged the court to impose a low-end guideline sentence and acknowledged both the harm to victims and Castaldi’s voluntary disclosure of his scheme and its details. Judge Darrah began the sentencing hearing by establishing that there were no objections to the presentence report and its guideline calculations. He established that he had read the defendant’s memorandum and all 44 attachments. He had also read the government’s memorandum and all the victims’ 1 (...continued) between the two crimes meant that the tax crime did not actually affect the combined offense level at all. See § 3D1.4(c). With a 3-level reduction for acceptance of responsibility under § 3E1.1, the total offense level was 34, with an imprisonment range of 151 to 188 months for criminal history category I. 6 Nos. 10-3406 & 12-1361 letters and statements submitted by the government. The judge reviewed with defense counsel the arguments in mitigation and then summarized the many letters written on Castaldi’s behalf. The judge reviewed the government’s memorandum with the prosecutor and then began reading from and summarizing many letters from victims. To describe these letters as compelling is an understatement. Victims described how Castaldi had deprived them of their life savings, college money for their children, money saved for retirement, money saved to start a business, money for medical care, and the life insurance money when a spouse died. One of Castaldi’s last victims described how he convinced her family to take out a new mortgage for $200,000 and invest it with him in late 2008, meaning it was lost. One letter pointed out that on November 15, 2008, when Castaldi knew his scheme was collapsing, he conned his own 92-year-old aunt to “invest” $120,000 with him so she could pay a care-giver with the interest. The aunt’s money was also lost, of course. Letter after letter described the victims’ loss of financial security and self-confidence, and their new lives of sleepless nights, stress, worry, and depression. In short, these victims trusted Castaldi not only with their money but also with their security, their pride, their hopes, and their dreams. That’s what he stole when he stole their money. The hearing then shifted to oral statements by victims exercising their right to be heard under the Crime Victims’ Rights Act, 18 U.S.C. § 3771. They described how they had loved Castaldi and trusted him with their life savings only to Nos. 10-3406 & 12-1361 7 have him steal everything. The oral statements were similar in content and power to the victims’ letters. As one victim said, “Frank Castaldi was able to send his daughters to college. I won’t be able to help my granddaughter … [go] to college.” So many victims wanted to speak that the judge eventually imposed time limits and limited repetition. Passions ran high in the courtroom. Some victims applauded or otherwise disturbed the decorum of the proceeding from time to time. The judge had to insist on order several times, and he warned audience members they could be removed if the disturbances continued. After the victims finished their statements, Castaldi’s lawyer spoke. He first acknowledged that it had been “an extraordinary afternoon” and that it was hard to imagine a more moving presentation. He reminded the court again of Castaldi’s confession, unprompted by an investigation, and his efforts to help the government sort out the case. The prosecutor also spoke once more, acknowledging that the government had not been aware of the Ponzi scheme when Castaldi confessed. Castaldi then exercised his right of allocution and briefly stated his apologies to the victims and his family.