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Lawyer's assistant sentenced in federal court on fraud charges

October 18, 2010

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The former assistant to a currently jailed attorney was sentenced in a Broward County federal courtroom for her involvement in one of the largest Ponzi schemes ever unraveled in South Florida. Debra Villegas appeared with her criminal defense lawyer to be sentenced on racketeering charges for which she pled guilty earlier in the year. The federal judge presiding over the case sentenced her to 10 years in prison for her alleged involvement in the massive scheme to defraud. According to the indictment and accompanying court documents, Villegas was Scott Rothstein's right hand in the investment scheme. Along with a 10 year prison sentence, the judge ordered the defendant to pay restitution in the amount of $363 million to the 300 plus victims of the Ponzi scheme.

The defense attorney representing Villegas put on testimony at the sentencing hearing in an effort to persuade the judge to reduce her sentence and in fact requested that her sentence be served as home confinement so she could care for her children. Her estranged ex-husband is facing murder charges for which her children will be called as witnesses. The judge was unmoved by the argument and sentenced her to the maximum sentence allowed under the law. While as dire as the situation may seem, the judge allowed the defendant to surrender to serve her sentence beginning June 2011. According to reports, Villegas has cooperated with the federal law enforcement and prosecutors to assist in nabbing the rest of those allegedly involved in the fraud. The imposition of the sentence was probably delayed at the request of the prosecution and the defense for several reasons.

While the defendant apparently did not receive a break for her cooperation at the sentencing hearing, federal law allows for a sentencing departure at any time after the sentence is imposed under a Rule 35. Sentence reductions for cooperation with the authorities can occur at the sentencing hearing under what in common parlance is called a 5K. A 5K will be offered by the government if a defendant provides substantial assistance in the investigation or prosecution of another person who has committed a criminal offense. Of course, any agreement of this nature between the government and the defense, will require the court to make a final determination of percentage decrease in the sentence. The court will evaluate the significance and usefulness of the assistance provided; the truthfulness, completeness and reliability of the information provided by the defendant; the nature and the extent of the defendant's assistance; and the timeliness of the defendant's assistance.

A Rule 35 will probably be more beneficial to the defendant in this particular case than a 5k because she will be able to continue cooperating prior to the date she must surrender. In some cases, a defendant can receive a 5k and a Rule 35 as part of a sentencing reduction. A reason to rest her departure on a Rule 35 and not 5 K is to let time pass where the case will not be so fresh and the public's and the court's mind. Despite the defendant's cooperation with the FBI and IRS, the judge rejected her defense attorneys request for 7 years of house arrest. Maybe after further cooperation with the government, the defendant's sentence may be reduced by the court.

Rothstein's Right-Hand Man, Debra Villegas, Sent to Prison, Miami, October 8, 2010.
Categories: Sentencing
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