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In this age of corporate greed, the courts are faced with many new issues surrounding restitution. The appeal of Bernard Jaffe Jr. gave the Second U.S. Circuit Court of Appeals its first opportunity to define the term “dependent” under the Mandatory Victims Restitution Act of 1996, which requires district courts to order restitution to compensate victims for their losses “without consideration of the economic circumstances of the defendant.”
In August, the Second Circuit ruled that a father's “moral” obligation to support his adult child should not be considered in computing the amount of restitution he owes for a crime. Upholding an order of restitution for a former New York executive convicted of making false statements to the Bank of New York to secure loans for his own stock-trading, the circuit found that adult children do not have the same status as spousal dependents. United States v. Jaffe, Docket No. 04-1278. Aug. 2, 2005.
Jaffe pleaded guilty in 2003 to making a false statement after an investigation revealed he had submitted false W-2 forms, portfolio statements and tax returns. In ordering full restitution, district courts are instructed to weigh: 1) the financial assets of the defendant, including whether any of those assets are jointly controlled; 2) a defendant's projected earnings and other income, and 3) the defendant's financial obligations, including obligations to dependents.
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