Life Real Loud

by Bill Reynolds

Hilary Watson, and maybe a friend or two of hers, would fly down from Salt Spring and the East Coast. For sure buddy Jim Hoggan and his wife, Enid Marion, would fly in from Vancouver. His daughter, Emily, and her husband, Pádraig, would come from Ireland to support him in the courtroom. Lefebvre said,

  On Friday night, we’ll probably have some kind of so-called celebration, dinner somewhere. I’ll probably make some reservations. I don’t feel like telling people not to come, but I don’t really feel like having a bunch of people hanging around either. I feel like I just have to roll with it. My overall feelings about this are not celebratory; my overall feeling about it is I’m getting hosed and that I’m biting my lip in the face of hypocrisy. And for people to slap me on the back is much like going to a funeral and having people say, “Well, it’s good to have that behind you.”

  Nearly five years in limbo had passed. The wait almost over, the dam Lefebvre built within himself to keep the bile, hurt, and anger at bay no longer had much foundation. He said,

  It’s taken me a tremendous amount of work to get to where I’m at peace, letting go of the feeling of offense that’s happened to me long enough to stand in front of His Honor with good conscience. When he says, “Do you have anything to say,” the answer will be, “No.”

  I despise the idea of maturing. I mature only if and for so long as I have to, and even that is all too mature.”

  Later, Lefebvre added that he despised the word “responsibility” almost as much as “maturing.”

  He continued,

  I’m on at two o’clock. Now there is some recent social science about appearing before the parole board. You have a seventy percent higher chance of being granted parole before lunch than after lunch. The later in the day you appear, the higher your chances are against getting parole. They call it information fatigue. But in my case there’s some notion—nobody’s promised it or anything—Steve and I will be dealt with more or less equivalently. I don’t think it matters who goes first, we’re going to wind up with more or less the same shtick.

  As Lefebvre approached his final hurdle, he still hadn’t spoken to his former business partner and friend. “He won’t take my call.” Pressed a little, Lefebvre admitted he could concoct a situation where he’d bump into Lawrence on sentencing day. “I could hang around outside his courtroom,” he said before adding, “I don’t know that that’s high on my list of things to do that day.”

  On Friday, September 9, 2011, Lefebvre encountered a new detour off the road to freedom. He emailed: “Hey, postponed to Oct 25. Federal marshals lost track of $16 million of my forfeiture. And no, they didn’t credit me twice. Can’t be sentenced without His Honor saying on the record that the forfeiture is paid in full, otherwise I’m litigating with a black hole for the rest of my life.”

  Lots of things have been lost in this protracted process. And not just things. The accused, for instance, got lost in the jail system between MDC L.A. and NYC. His wallet went missing for a time. And where was his passport again? And you know, Mr. Lefebvre, forty percent of your forfeiture, heh-heh, well, we can’t seem to find it.

  Steve Lawrence’s sentencing, meanwhile, will go ahead as scheduled, which severs the parallel-prosecutions story line.

  • • •

  On Friday, September 23, 2011, at 10 a.m., on a gray Manhattan morning, Lawrence is back in 12C of the Daniel Patrick Moynihan United States Courthouse, 500 Pearl Street. The Moynihan is a solid, imposing building made with granite, marble, and oak that stands on the infamous Five Points, the gathering locale for nineteenth-century brawls, portrayed in 2002 by Scorsese’s Gangs of New York. Moynihan, Hillary Clinton’s predecessor, was an important, long-running U.S. senator from the state of New York. He was instrumental in securing the necessary financing for the $1-billion redevelopment of Foley Square and its law buildings. The Moynihan, the second-largest federal courthouse in the nation, stands twenty-seven stories tall and contains forty-four courtrooms. Moynihan helped pick many of the judges who mete out justice equally and impartially here, but not Castel. On March 5, 2003, President George W. Bush nominated Castel for his seat on the District Court for the Southern District of New York.

  The elusive Lawrence, who avoided a press photographer at the front of the courthouse, sits slope-shouldered and bald in a dark blue suit. From the back he looks like Homer Simpson at a funeral. He turns briefly and reveals more chiseled features. He has a fine nose, a receding chin, bags under his eyes, but also a full complement of smile lines—what one might expect from someone who’s spent happier days in the Bahamas but likely a few sleepless nights in New York. The court is empty save for three people sitting in the next pew, immediately behind Lawrence. His wife, Perle, is flanked by two others—his brother, possibly, judging from the nose, and a second woman, a patrician blond in her early forties. Lawrence’s lawyer Peter Neiman, late thirties and looking a bit like Al Pacino circa Dog Day Afternoon, sits beside him.

  Lefebvre’s lawyer Vince Marella and his wife are also spectators. They’re on vacation and dressed casually, perhaps too casually for the solemn proceedings. It’s hard to believe Castel would take this as a slight, but we’ll find out on October 23. Marella is on a mission to report back to his partner Gluck and to Lefebvre.

  A latecomer in a suit sneaks in just before the judge arrives, shakes hands with Lawrence, and sits down on the right side of the room. There are few official people here aside from Neiman and the prosecutor, Assistant U.S. Attorney Arlo Devlin-Brown, and U.S. Attorney for the Southern District of New York Preet Bharara, the man who took down the eleven online gaming executives in April. There are officers of the court, the court reporter, the court clerk, Homeland Security’s Steven Cash, and the FBI’s Jonathan Ball.

  An avuncular Castel enters the silent, carpeted room. “Good morning, Mr. Neiman, Mr. Lawrence.” He mentions Lawrence’s letters of support as well as the receipt of the forfeiture and a raft of other documents. He is sentencing Lawrence under a criminal history Level 1 (meaning he has no priors).

  Neiman suggests that as an example of leniency in online gambling cases, Castel might look at the sentencing of Anurag Dikshit by U.S. District Judge Jed S. Rakoff in New York. Dikshit’s company, PartyGaming, had been involved in illegal online transfers and illegal gambling, and although he agreed to the government’s $300-million forfeiture and one year’s probation, no prison time was demanded. Neiman says other examples of this type are in the documentation. Then he says Lawrence took the sentencing seriously, and his cooperation with prosecutors has been unprecedented. He demonstrated caring for others, gave a lot of money to charity, and spent hundreds of hours in soup kitchens and old-age homes in the Bahamas—“in essence Mr. Lawrence has spent the last almost five years on probation in some ways, right?” Right.

  Castel then offers Lawrence an opportunity to speak for himself. He begins, “Your Honor, thank you for allowing me to speak at this time.” He recounts his first appearance in court in 2007, careful to reiterate that his “behavior was wrong” and that he tried to change company behavior post-UIGEA but realizes those actions “came too late.” Then he talks about atonement: “Since that time, I’ve done my very best to assist the government, and I believe that my efforts have helped the government very much.”

  Then Lawrence veers into a personal issue. He has been married to the same woman for twenty-three years. As she continues to fight the stage III breast cancer she was diagnosed with in 2009, he expresses regret for the “pain and embarrassment that my actions caused her and my family.” Things aren’t looking up in business for Lawrence, either. He says the bust and the guilty plea stalled out his venture capitalism career and it’s been tough to earn a new buck. That’s a bridge statement so he can talk up all the charitable work and community service he’s performed since 2008 in the Bahamas. “I’ve been working firsthand with the destitute in my community,” he says, “which has opened my eyes to true human suffering
.”

  Lawrence concludes by saying he believes he has helped many of the needy, and while he understands completely how wrong his actions were, he respectfully asks the judge to show mercy and “not separate me from my loved ones and please allow me to go on serving the needy in my community. Thank you.” Prosecutor Devlin-Brown chips in a word in Lawrence’s favor. He says the defendant’s “cooperation in this case truly is extraordinary and deserves substantial consideration at sentence.”

  Castel calls Neiman and Devlin-Brown’s comments “helpful” and Lawrence’s statement “sincere.” He gives a quick sketch of Lawrence’s life—born in Ottawa, spent much of his life in Calgary, a business administration graduate of the University of Western Ontario, a talented man with great ability, Neteller would be a substantial accomplishment if it had been legal, mentions all the good deeds since the indictment, etc., but also drops in this nugget:

  Notably, in 2004, several years before his arrest, he transferred $210 million by deed of gift into a foundation for his wife and daughter, and the foundation owns real estate holdings in various locations. They own a yacht, eight vehicles—eight automobiles, I assume—four golf carts, and a motorcycle, and the defendant has the benefit and use of at least the physical assets of the trucks. I should also mention that the defendant’s wife in turn is the owner of another business that in turn owns a Cessna 414 aircraft.

  Then Judge Castel makes the turn. He says in the U.S., the people elect representatives who determine public policy, and “gambling, online gambling, sports betting, poker” are unlawful. At least in New York anyway, he might have added, where it has been deemed illegal to use a computer to transfer money to place a bet at a jurisdiction where gambling is legal. “Somebody might take issue with this,” he concedes, before saying, hey, go talk to your elected representative if you don’t like it and try to get the law changed. Then he makes a general statement that makes clear his distaste for the subject: “Gambling corrupts and destroys and erodes people’s lives—unlawful gambling.”

  Lawful gambling can corrupt and destroy people, too, of course, but he does not make this point. Then Castel brings his version of historical context to the sentencing preamble: “If you go in the past, oh, I would say from 1919 through to 2007, there are three spectacular instances of where it was sports betting that corrupted what many Americans, and Canadians, hold dearly—the sport of baseball.” Uh-oh, looks like Lawrence is going to pay for Shoeless Joe Jackson, the Black Sox, and the 1919 World Series scandal.

  The second instance cited is not a baseball scandal but rather a point-shaving exercise in college basketball that went on between 1947 and 1951, affecting eighty-six games and ruining many careers. The third instance is also about basketball corruption: “an NBA referee who pled guilty to making calls on the court to influence the point spread in a game.” Judge Castel is referring to Tim Donaghy, who, in his last couple of years of officiating, bet on games he worked and made calls that affected the point spread. Americans hold basketball dearly, too.

  “So the fact of the matter is,” Castel says, “to those who love sports, love basketball, love baseball, love football, it has in fact a corrosive effect on all of that.”

  Looks like Lawrence is doing time.

  “Based upon all of the foregoing circumstances, a sentence of forty-five days’ imprisonment, supervised release of one year, and a fine of $1 million and the imposition of a special assessment of $100 is, in my view, sufficient but not greater to achieve the purposes of Section 3553(a).”

  Lawrence blinks. Neiman can only muster, “Obviously we’re asking for a different sentence than that.”

  Castel asks Lawrence to stand so he can impose the sentence. He is “hereby remanded to the custody of the United States Bureau of Prisons to be imprisoned for forty-five days.” The defendant waives his right to appeal.

  Neiman asks for mercy in regards to the immediate remand. He asks that his client be allowed to surrender voluntarily and gives a number of reasons why Lawrence has nothing to gain from fleeing. “He’s been out on bail for years and proven himself to be no risk of flight.”

  Castel expresses reluctance: “The defendant does not have the kind of ties to the United States.… He could very easily elect to … remain in the Bahamas or Canada, where he’ll live very, very comfortably, rather than return to do the sentence.”

  Castel’s resolve becomes more visibly evident as the two federal marshals standing behind Lawrence move closer to the prisoner. He’s obviously seeing a need to combat the public perception that white-collar criminals can pay fines and otherwise walk away scot-free. By imposing a short sentence, one and a half months, to be served immediately, he wants the defendant behind bars to physically pay down his debt to society before getting on with his life.

  Neiman points out that before Lawrence made good on his $60-million forfeiture he was permitted to go back to Canada, twice, to visit his ailing father and then to attend his father’s funeral. Both times he returned. In fact, Lawrence had traveled all over the world and always returned, so why would he renege on his enormous forfeiture and face the life of a fugitive? Good point, but Castel’s mind is made up: “I respect your arguments and they are very well presented” is all he offers.

  Then Devlin-Brown gets into the act, reiterating the point about Lawrence’s full, complete cooperation with the FBI and reinforcing Neiman’s view that the defendant poses no flight risk. No dice. “My decision has been made,” concludes Castel. “Thank you. We are adjourned.”

  The prisoner blinks. He stands about five-foot-seven. He hugs his wife, turns, and leaves with the marshals. And that, quite likely, is the last anyone will see or hear of the press-averse, hyper-wealthy Mr. Stephen Eric Lawrence.

  • • •

  Two days before Lefebvre’s sentencing, on Sunday, October 23, 2011, I meet him and his entourage at the Twenty-Third Street stairway entrance to the High Line, Manhattan’s elevated antiquated railway line turned sleek linear park. He’s with Hilary Watson, who has stuck by him through almost five years of intense FBI scrutiny. Emily and Pádraig arrived from Dublin the night before. Lefebvre and Watson boarded a flight from Seattle and got in Friday around nine in the evening. “The final chapter,” he says as he greets me and my wife, Laura. “Well … I hope not.”

  “What about visiting hours in jail?”

  “Sure, Plexiglas and phones. That’s good for a chapter—or maybe a paragraph.”

  “When’s the last time you were this clean shaven?”

  “About five years ago, when I went to see the judge for the first time. I thought I’d make it easy for him. Make sure His Honor recognized me.”

  Watson does her best not to look stricken, yet she is visibly emotional and occasionally teary-eyed about what everyone now expects will be a remand to custody on Tuesday following the 2 p.m. hearing—after Castel finishes rhapsodizing about the 1919 World Series theft.

  My wife thinks the worst—that Lefebvre is going to get slapped with six months. That would be “eating a lot of chicken à la king,” as he puts it. The reason she believes this will happen is that, unlike Lawrence, this is not a first offense for Lefebvre. That old drug bust, way back in 1969, at age seventeen, is going to be recalled, duly noted, and come back to bite him in the jumpsuit. We do not yet know that the Canadian offense has been sealed off.

  Then again, Castel might buy what will likely be Marella’s argument: that Lawrence was the principal founder of Neteller, not Lefebvre; that Lawrence hired Lefebvre, enticing him with a hefty cut of the company ownership pie; that really, when you think about it, Lefebvre’s purpose in the company was twofold—one, to find investors (which he did), and two, to be the marketing guy, the public face, Meat Loaf with the Man Purse (which he also did, quite well); and that Lefebvre was not a business guy and actually knew SFA about computers and gambling and software and writing code and unclogging the payment route f
or online gamblers (“I was just a guy Steve could trust with the shop while he was out”).

  But Lefebvre learned fast. He sold the idea, he was charismatic, and everybody wanted to work with him. He was a helluva guy to be around, and he was a helluva good boss to work for in Calgary and San José.

  That might just work. Castel might buy Marella’s argument because, who knows, maybe Castel is a bit impressionable.

  “Didn’t it ever occur to him that the first time Steve ever stepped inside a soup kitchen was after his arrest?” asks Lefebvre.

  Pádraig pipes in, “Do they even have soup kitchens in the Bahamas?”

  “When we were putting together the documents showing my donations,” Lefebvre says, “we came across Steve’s one and only donation to a charity—and it was to the Lefebvre Foundation. Steve wanted to give me money because I lent him my jet. I told him to fuck off. ‘I don’t want yer money, Steve. I’m not takin’ it, okay?’ So he said, ‘Okay, then,’ and made a $2,000 donation to my foundation. That was Steve’s charity work.”

  “Wait,” I wonder, “what about his own charity foundation, the one in his wife’s name?

  “Oh,” Lefebvre wonders, “he’s got his own foundation, does he?”

  “It’s in his wife’s name but he has access to it,” I answer. “During his arraignment this became a heated point. The prosecution under no circumstances wanted Lawrence to walk out on $5 million bail. He had access to his wife’s foundation, they reasoned, access to at least $200 million in other words, plus the guy had to have other assets out there they didn’t even know about, so $5 million was nothing. He was a high roller and there was nothing stopping him from walking. The judge did not buy the argument, but they did jaw back and forth for a while.

  “And your name came up, John,” I continue. “The prosecutor used the example of the other Neteller founder, how Lawrence had been arrested first and how you’d been tipped off.”

  Lefebvre looks at me, incredulous. “Oh yeah? Tipped off, eh? And what the fuck would I be doing standing around making tea in my house in Malibu if I’d been tipped off?”