A federal judge in the US District Court for the Central District of California Monday sentenced leading class-action securities lawyer Melvyn Weiss to 30 months in prison and ordered him to pay over $10 million in fines and forfeitures. The former Milberg Weiss partner pleaded guilty in April to one count of racketeering conspiracy related to an alleged kickback scheme. Federal prosecutors had recommended the maximum sentence of 33 months "because Weiss continued paying illegal kickbacks after he knew that the firm was under investigation and he tried to obstruct investigators by not providing subpoenaed documents." In his sentencing memorandum, counsel for Weiss had urged the court to "impose the lowest sentence allowed" under the plea agreement because of Weiss' substantial pro bono work and philanthropic endeavors.
Prosecutors alleged that since 1984, the firm had paid up to $11.3 million in illegal kickbacks under a scheme where individuals agreeing to serve as lead plaintiffs in class action and shareholder derivative lawsuits were promised 10 percent of the attorney fees eventually received by the firm. In April, Reuters reported that Weiss' former law firm, now known as Milberg LLP, had entered into negotiations with federal prosecutors to settle accusations. Three individuals pleaded guilty in connection with the scheme in May 2006 after a federal grand jury indicted the firm.
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