UPDATED 5:18 P.M. ET (U.S.A.) A federal judge has denied the bid of AdSurfDaily President Andy Bowdoin to reverse his decision to forfeit tens of millions of dollars to the government in a case that features allegations of wire-fraud, money-laundering and operating a Ponzi scheme.
“As Mr. Bowdoin’s own descriptions of events fail to support these arguments, and there is no other reason to grant reconsideration . . . the Court will deny the motion,” said U.S. District Judge Rosemary Collyer.
Collyer also denied a motion by Bowdoin for a second evidentiary hearing, saying the matter was moot because she was not permitting him to reenter the forfeiture case after he previously submitted to the forfeiture. Collyer ruled after an evidentiary hearing last year that ASD had not demonstrated it was a lawful business and not a Ponzi scheme.
“[N]othing in Mr. Bowdoin’s own sworn statement justifies the conclusion that he was mistaken [in releasing the claims in January], that the Government engaged in any misrepresentation or misconduct, or that his attorney provided bad advice,” Collyer ruled. “He also fails to present any meritorious defense.”
The ruling was a crushing blow to Bowdoin, and Collyer minced no words, saying evidence in the forfeiture case against him “appears to be strong” and that Bowdoin “balked” after submitting to the forfeiture.
“The Government charges that Mr. Bowdoin operated a Ponzi scheme on the Internet,
whereby he, using ASD as a vehicle, bilked hundreds of people,” Collyer said. “Presented by affidavit and testimony outside the crucible of a criminal trial, its evidence appears to be strong. In the face of the civil in rem proceedings and the expected criminal prosecution, it is no surprise that his criminal lawyer would recommend a cooperation plea with demonstrated early acceptance of responsibility, i.e., withdrawal of claims to the seized assets, so that Mr. Bowdoin might earn a motion for a downward departure under Section 5K1.1 of the United States Sentencing Guidelines and/or 18 U.S.C. § 3553, both of which allow the Court to impose a sentence below the statutory minimum to reflect a defendant’s ‘substantial assistance’ to a Government investigation.”
Bowdoin’s former attorney, Stephen Dobson, whom Bowdoin’s current attorney Charles A. Murray claimed served Bowdoin poorly while Bowdoin was meeting with prosecutors last winter to settle the forfeiture case and discuss a potential criminal plea, behaved responsibly, Collyer said.
“Such an approach from counsel could be seen as the norm when the Government’s evidence is strong,” Collyer said. “What Mr. Bowdoin hoped to gain from his release of claims/early acceptance of responsibility and his debriefing with the Government was a promise of no jail time. When that was not forthcoming from the Assistant United States Attorney, Mr. Bowdoin balked and tried to back up, as if he had not already released his claims and talked to the Government.”
Collyer cited several claims from Bowdoin himself when issuing her ruling this afternoon, repeating Bowdoin’s own words back to him to demonstrate he had not been ill-served by Dobson or lied to by the government: (Emphasis added.)
- Dobson represented to me that I could possibly avoid prison or get a reduced sentence if I agreed to disclose details concerning ASD and releasing the assets.
- I also signed a document stating that I would release my claims in the abovecaptioned civil in rem forfeiture proceeding, again thinking that necessary for a possible avoidance of a prison term.
- I did all of this on the understanding that by cooperating I could possibly avoid a prison sentence.
- I agreed not to exercise my rights in the civil forfeiture proceeding, anticipating from representations made by Dobson that this could possibly keep me out of prison.
- Dobson lead [sic] me to believe that if I cooperated there was a possibility that I would not be incarcerated or imprisoned.
- I believed that my cooperation would still result in a criminal sentence that could possibly not include imprisonment or incarceration.
- [Prosecutor William] Cowden explained that I would be subject to the maximum penalty under the statute, but that he would inform the judge that I cooperated.
- I slowly came to understand what I understood from Dobson not to be the case: that my agreement to cooperate provided me no benefit in the criminal matter except the possibility of a reduced sentence if the judge desired which would still be a life sentence.
“Each of these statements indicates that Mr. Bowdoin completely understood what he
was doing: releasing his claims and cooperating to ‘possibly avoid a prison sentence,’” Collyer said.
In September, prosecutors argued that any thought by Bowdoin that a $100 million, wire-fraud and Ponzi scheme crime would not result in imprisonment upon conviction was ludicrous.
Collyer said the allegations were serious and easily could result in prison time.
“If he proceeds to trial and the evidence persuades a unanimous jury beyond a reasonable doubt that Mr. Bowdoin is guilty as charged, he will face a term of incarceration for sure,” Collyer said. “Mr. Dobson’s hope was to avoid such a result by avoiding a trial and persuading the Government to file motions with the Court that could be used to argue for a sentence that did not include jail time.”
Collyer said Bowdoin’s behavior has been puzzling.
“It is very strange that Mr. Bowdoin passed that opportunity by, despite clear knowledge that it ‘could possibly keep me out of prison,’” she said. “Perhaps the delay in obtaining an indictment has led Mr. Bowdoin to believe that he will not be indicted after all.”
Collyer also pointed to a stated belief by Bowdoin that a grand-jury indictment had been returned, saying she hasn’t see one.
“Mr. Bowdoin believes the Government ‘submitted charges before a grand jury on or about May 2009,’†Collyer said, using Bowdoin’s affidavit as her resource. “[B]ut as of this date no indictment has been returned against him in a federal court.”
Read Collyer’s ruling.