Shalom Weiss
Encyclopedia
Sholam Weiss is a former American businessman and convicted felon. In 2000 he was convicted of multiple fraud and money laundering counts and sentenced to 845 years in prison for looting the National Heritage Life Insurance. It was believed to be the largest insurance failure in history at the time, with over $450 million in losses. Weiss fled the country at the end of his trial and was a fugitive for one year. He was subsequently extradited from Austria
.
The sentences imposed on Weiss and his 2 accomplices, Michael Blutrich and Richard Herman, were believed to be the longest known to have ever been imposed for a white-collar crime
. Weiss was convicted of 78 counts including racketeering, wire fraud
, and money laundering
and ordered to pay $125 million in restitution
and $123 million in penalties. About a dozen individuals were convicted for involvement in the collapse; another defendant, Keith Pound, received a 700 year sentence, and $139 million in restitution and died in prison.
Weiss was captured in Austria and extradited pursuant to an international arrest warrant. He was not permitted to appeal his extradition in accordance with the fugitive disentitlement doctrine, which holds an appeal may be rejected on the grounds that the appellant is a fugitive.
, where his father ran a fruit stand. He was educated in a yeshiva
, where he spoke Yiddish, and received the equivalent of a high school education. He was born and raised Jewish
. He did not learn English until he was in his late teens. He began doing construction work as a young man and established a plumbing supply company.
The plumbing supply firm failed and declared bankruptcy
. Weiss began hiring himself out as a bankruptcy specialist, advising other businesses. Through that business he met Michael D. Blutrich, who owned the topless club Scores, which then was controlled by the Gambino Crime Family
.
In 1994, Weiss was indicted on mail fraud charges. He was convicted and served eight months in prison.
, with the loss exceeding $450 million.
Federal authorities said the fraud began in the early 1990s, when a group of businessmen began looting the company. Weiss took control in 1993, and with several confederates bought up worthless stocks and mortgages. The money vanished or ended up in accounts controlled by Weiss.
On October 18, 1999, after a nine-month trial, Weiss failed to appear while the jury was deliberating, and was declared a fugitive. At Weiss's sentencing on the National Heritage charges in February, Judge Patricia C. Fawsett
said that Weiss should be removed permanently from society because of the magnitude and repeated nature of his fraudulent acts. He was eventually apprehended by Austrian authorities in the Fall of 2000.
Weiss was extradited from Austria after appeals to the European Court of Human Rights
and the United Nations
failed to prevent his extradition.
petition in federal court, claiming that the United States violated its extradition treaty with Austria. Because the courts cannot provide a re-sentencing and appeal, Weiss argued that, under treaty law, the Executive branch of the United States must still provide the benefit of a re-sentencing and appeal and that he was denied that benefit as a result of the fugitive disentitlement doctrine. Weiss is currently serving his 845-year sentence at United States Penitentiary, Canaan
, a high security prison near Scranton, Pennsylvania
. He has a current projected "release date" of November 23, 2754, effectively a life sentence.
Austria
Austria , officially the Republic of Austria , is a landlocked country of roughly 8.4 million people in Central Europe. It is bordered by the Czech Republic and Germany to the north, Slovakia and Hungary to the east, Slovenia and Italy to the south, and Switzerland and Liechtenstein to the...
.
The sentences imposed on Weiss and his 2 accomplices, Michael Blutrich and Richard Herman, were believed to be the longest known to have ever been imposed for a white-collar crime
White-collar crime
Within the field of criminology, white-collar crime has been defined by Edwin Sutherland as "a crime committed by a person of respectability and high social status in the course of his occupation" . Sutherland was a proponent of Symbolic Interactionism, and believed that criminal behavior was...
. Weiss was convicted of 78 counts including racketeering, wire fraud
Wire fraud
Mail and wire fraud is a federal crime in the United States. Together, 18 U.S.C. §§ 1341, 1343, and 1346 reach any fraudulent scheme or artifice to intentionally deprive another of property or honest services with a nexus to mail or wire communication....
, and money laundering
Money laundering
Money laundering is the process of disguising illegal sources of money so that it looks like it came from legal sources. The methods by which money may be laundered are varied and can range in sophistication. Many regulatory and governmental authorities quote estimates each year for the amount...
and ordered to pay $125 million in restitution
Restitution
The law of restitution is the law of gains-based recovery. It is to be contrasted with the law of compensation, which is the law of loss-based recovery. Obligations to make restitution and obligations to pay compensation are each a type of legal response to events in the real world. When a court...
and $123 million in penalties. About a dozen individuals were convicted for involvement in the collapse; another defendant, Keith Pound, received a 700 year sentence, and $139 million in restitution and died in prison.
Weiss was captured in Austria and extradited pursuant to an international arrest warrant. He was not permitted to appeal his extradition in accordance with the fugitive disentitlement doctrine, which holds an appeal may be rejected on the grounds that the appellant is a fugitive.
Early life and background
Weiss grew up in Borough Park, BrooklynBorough Park, Brooklyn
Borough Park , is a neighborhood in the southwestern part of the borough of Brooklyn, in New York City in the United States....
, where his father ran a fruit stand. He was educated in a yeshiva
Yeshiva
Yeshiva is a Jewish educational institution that focuses on the study of traditional religious texts, primarily the Talmud and Torah study. Study is usually done through daily shiurim and in study pairs called chavrutas...
, where he spoke Yiddish, and received the equivalent of a high school education. He was born and raised Jewish
Jews
The Jews , also known as the Jewish people, are a nation and ethnoreligious group originating in the Israelites or Hebrews of the Ancient Near East. The Jewish ethnicity, nationality, and religion are strongly interrelated, as Judaism is the traditional faith of the Jewish nation...
. He did not learn English until he was in his late teens. He began doing construction work as a young man and established a plumbing supply company.
The plumbing supply firm failed and declared bankruptcy
Bankruptcy
Bankruptcy is a legal status of an insolvent person or an organisation, that is, one that cannot repay the debts owed to creditors. In most jurisdictions bankruptcy is imposed by a court order, often initiated by the debtor....
. Weiss began hiring himself out as a bankruptcy specialist, advising other businesses. Through that business he met Michael D. Blutrich, who owned the topless club Scores, which then was controlled by the Gambino Crime Family
Gambino crime family
The Gambino crime family is one of the "Five Families" that dominates organized crime activities in New York City, United States, within the nationwide criminal phenomenon known as the Mafia . The group is named after Carlo Gambino, boss of the family at the time of the McClellan hearings in 1963...
.
In 1994, Weiss was indicted on mail fraud charges. He was convicted and served eight months in prison.
National Heritage Life Insurance
Weiss' looting of the National Heritage Life Insurance Co. was the largest in history, according to the FBIFederal Bureau of Investigation
The Federal Bureau of Investigation is an agency of the United States Department of Justice that serves as both a federal criminal investigative body and an internal intelligence agency . The FBI has investigative jurisdiction over violations of more than 200 categories of federal crime...
, with the loss exceeding $450 million.
Federal authorities said the fraud began in the early 1990s, when a group of businessmen began looting the company. Weiss took control in 1993, and with several confederates bought up worthless stocks and mortgages. The money vanished or ended up in accounts controlled by Weiss.
On October 18, 1999, after a nine-month trial, Weiss failed to appear while the jury was deliberating, and was declared a fugitive. At Weiss's sentencing on the National Heritage charges in February, Judge Patricia C. Fawsett
Patricia C. Fawsett
Patricia C. Fawsett is an American lawyer and judge.Fawsett was born in 1943 in Montreal, Canada. She received her Bachelor of Arts degree from the University of Florida in 1965, her Master of Arts in Teaching from the University of Florida in 1966, and her J.D...
said that Weiss should be removed permanently from society because of the magnitude and repeated nature of his fraudulent acts. He was eventually apprehended by Austrian authorities in the Fall of 2000.
Weiss was extradited from Austria after appeals to the European Court of Human Rights
European Court of Human Rights
The European Court of Human Rights in Strasbourg is a supra-national court established by the European Convention on Human Rights and hears complaints that a contracting state has violated the human rights enshrined in the Convention and its protocols. Complaints can be brought by individuals or...
and the United Nations
United Nations
The United Nations is an international organization whose stated aims are facilitating cooperation in international law, international security, economic development, social progress, human rights, and achievement of world peace...
failed to prevent his extradition.
Incarceration and subsequent proceedings
Weiss challenged his incarceration in a habeas corpusHabeas corpus
is a writ, or legal action, through which a prisoner can be released from unlawful detention. The remedy can be sought by the prisoner or by another person coming to his aid. Habeas corpus originated in the English legal system, but it is now available in many nations...
petition in federal court, claiming that the United States violated its extradition treaty with Austria. Because the courts cannot provide a re-sentencing and appeal, Weiss argued that, under treaty law, the Executive branch of the United States must still provide the benefit of a re-sentencing and appeal and that he was denied that benefit as a result of the fugitive disentitlement doctrine. Weiss is currently serving his 845-year sentence at United States Penitentiary, Canaan
United States Penitentiary, Canaan
United States Penitentiary, Canaan is a Federal Bureau of Prisons facility located in Canaan Township, Pennsylvania, near Waymart.USP Canaan is approximately east of Scranton, Pennsylvania. The United States Penitentiary-Canaan is a high security prison that houses male inmates. A satellite camp,...
, a high security prison near Scranton, Pennsylvania
Scranton, Pennsylvania
Scranton is a city in the northeastern part of Pennsylvania, United States. It is the county seat of Lackawanna County and the largest principal city in the Scranton/Wilkes-Barre metropolitan area. Scranton had a population of 76,089 in 2010, according to the U.S...
. He has a current projected "release date" of November 23, 2754, effectively a life sentence.