Legal Blog: Exclusive Legal Analysis Concerning Teresa Giudice Restitution Orders

There is perhaps no other individual today most closely associated with the principal of restitution than “Real Housewives of New Jersey” star, Teresa Giudice. Legislatures and courts have recognized that holding a convicted offender financially responsible for the harm caused by their crime is a proper sanction. Restitution also enables, to some extent, victims to be made whole again. Anything of value can be taken to satisfy a restitution judgment, including homes, cars, furniture, artwork, jewelry, and Fendi sunglasses. 

The cookbook author inked a deal to pay back money she owes in the amount of $414,588.90 to the federal government in connection with her bankruptcy fraud case. Her attorney, James J. Leonard Jr., tells PEOPLE the outstanding restitution is less than $200,000. “She has been cooperative, as has Joe, in making payments to the government pursuant to their obligations,” Leonard declares. “I have no doubt that this debt will be paid in full.”

The consent orders establish that an agreement was made with federal prosecutors for Teresa to pay restitution commanded by U.S. District Court Judge Esther Salas at sentencing.  According to the bundle of consent orders dated June 5, 2015 that contain Teresa’s John Hancock, she is required to have 25% of any monies payable to her from Bravo withheld and sent directly to the U.S. Treasury to help pay down her debt.

In addition the government will procure half of any rent received from her home in Lincoln Park, NJ, according to consent orders filed by the U.S. Attorney’s Office.

The orders also provide that Axa Equitable and Lincoln Benefit shall withdraw any monies held on behalf of, or payable to Teresa, and pay the sum to the government.

As per the order, the feds will also get “household furnishings” inside the mansion on Indian Lane that Teresa shares with her husband and co-defendant Joe Giudice.

Teresa’s 2005 Maserati Quattroporte, an object of beauty and one of the world’s most aspirational vehicles must be surrendered to the federal government to help satisfy the judgment.

The garnishee orders are judgments that direct third parties — Bravo, rents receivable from 86 Pine Brook Road in Lincoln Park, NJ as well as money from two insurance polices (Axa Equitable and Lincoln Benefit) — in possession of the defendant’s property to make it available to the plaintiff to satisfy the debt. The money and property described in these consent orders will go towards satisfying a $414,588.90 judgment. Will restitution force Teresa to confront, in concrete terms, the harm her actions have caused?

READ: Teresa Giudice Did Not Rob Banks Only; List of Other Businesses She Stole From

Back in December, before Teresa went to prison, “she and I met with attorneys from the U.S. Attorney’s office in Newark, as well as investigators from the U.S. Attorney’s Financial Litigation Unit,” Teresa’s lawyer, James J. Leonard Jr., told PEOPLE. Federal prosecutors filed in court on June 5 the restitution agreement but Leonard claims, “it was signed and agreed upon in late December and the only thing that has happened since then is that she has made payments in accordance with that agreement.”

More than a year ago, Teresa and Joe pled guilty to bank and bankruptcy fraud. They confessed to burying assets from court officials as well as submitting falsified loan applications to obtain some $5 million in mortgages and construction loans. Judge Esther Salas sentenced Teresa to a 15-month prison term; she is expected to serve 85% of that time at Danbury Federal Correctional Institution in Connecticut. 

Orders to pay restitution are an important part of how we punish convicted criminals. Restitution may be incorporated into criminal proceedings for reasons of economy and pragmatism. However, many people have large amounts of restitution that they are ordered to pay back but realistically never can. The size of uncollected federal restitution is estimated to be at least $50 billion and white-collar crime cases account for the largest amount of uncollected debt and unpaid restitution.

The correlation between payment of restitution and recidivism is unmistakable. Historically, offenders who pay a higher percentage of their court-ordered restitution are less likely to commit a new crime.  Some offenders will repeatedly commit crimes, will be in and out of prisons, and will never pay more than a trivial amount of restitution.

In high-profile cases, the government often emphasizes restitution orders as proof that they are cracking down on crime. Yet frequently those verdicts are negotiated to a fraction of their original amounts in an effort to swiftly seize payment. In this case, a series of consent orders/agreements were negotiated between federal prosecutors and Teresa giving the former the ability to retrieve funds expeditiously.

Since many prosecutions end in guilty pleas, decisions made by U.S. Attorneys in plea agreements usually control the outcome of restitution. The parties typically stipulate to a restitution amount in the plea agreement, a norm that at least raises the possibility that the government will be repaid.

You might wonder what happens if Teresa fails to fork over the Maserati, home furnishings or 50% of rent received from her Lincoln Park abode.  Also what drama will follow if Bravo neglects to deliver 25% of Teresa’s earnings to the government?

A court approved these consent orders and consequently, any breach is effectively a violation of the order. In most cases, the employer is required to honor the garnishment order, and can face disciplinary action if they fail to do so. If any terms of the agreement are violated, imposition of a fine, attachment of assets, placement of liens on property or prison time may result. The defendant usually must fulfill his or her responsibilities as per the order immediately. Once a court has approved a consent order it is legally binding. Sometimes probation or parole may be revoked for failure to pay restitution, however the offender’s failure usually must be intentional/willful.

Unpaid restitution promotes a loss of faith in the criminal justice system. Do you think the government will be able to fully enforce the restitution order here? Grab your gavel, join the conversation, and let us know what you think about the reasonableness of the consent orders and whether restitution will be satisfied.

 

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