by Gwen Moritz
Posted 11/4/2013 12:00 am
Updated 9 months ago
“Sometimes,” my co-worker said when I reported back to the newsroom after watching Steve Clary receive a federal prison sentence, “people just need to hear you say you’re sorry.”
And she is right. The community victimized by crime does need to hear that the perpetrator is sorry. And I have rarely heard any white-collar criminal apologize as well as Clary, whose desperate attempt to save his collapsing real estate development business back in 2008 included misappropriating a bank loan.
Having had a long, long time to think about it — I’m coming to that — Clary wrote and read in court a long statement in which he apologized to all the right people and in which he made no excuses.
Having been present for both, I can tell you that Clary said he was sorry much, much better than Lu Hardin, the former president of the University of Central Arkansas, did at the hearing in which he pleaded guilty to wire fraud. Hardin, you may recall, kept telling U.S. District Judge James Moody that he was “accepting full responsibility” for deceiving UCA trustees into accelerating a $300,000 bonus. Moody had to press Hardin into agreeing that he had actually committed the crimes to which he was pleading guilty.
There was none of that hair-splitting at Clary’s sentencing hearing on Wednesday, which was satisfying to this observer. Especially after a motion he and his federal public defender, Lisa G. Peters, had filed over the summer that seemed to argue that the $1.6 million Clary diverted from a bank loan wasn’t really all that much considering how rich he had been. (Clary’s personal financial statement showed a net worth of $92 million at the end of 2007, just months before his crime. But, as another co-worker pointed out, personal financial statements can be an exercise in irrational exuberance. Someone truly worth that much wouldn’t have to essentially steal less than 2 percent of that total in order to avoid financial collapse, not even during the financial collapse of 2008.)
By Wednesday, that argument — stunning in its suggestion that the severity of a crime is relative to the criminal’s net worth — had vaporized. If there was any reference to it at all, it was in U.S. District Judge Leon Holmes’ statement that Clary had caused a “very large loss of money” for Bank of America Leasing Capital and that such a loss “does require jail time.”
Clary himself said he had betrayed the trust of bankers with whom he had done business over many years. Well, yes.
I was even satisfied with Clary’s statement that he and his wife had filed for bankruptcy only to get relief from immediate payment of their enormous ($168.6 million) debts rather than to avoid paying them altogether. He said the balance has been whittled down to less than $50 million, which is considerable progress, though the balance is still breathtaking, particularly for a man of 61.
Which brings me back to just how much time Clary’s had to think about his crime. This thing happened more than five years ago. He was indicted more than three years ago. He could have admitted his guilt from the get-go — even before the indictment — but he didn’t. I don’t have any inside information, but I doubt the plea deal he got later was significantly better than the one he could have gotten earlier, and it would have saved a lot of money for the taxpayers who paid both the prosecution and the defense. If he’d taken responsibility earlier, he could be out of prison by now.
Lu Hardin got off without prison time, which to me has always been a better testament to his defense attorney (Chuck Banks, in case you are shopping for one) than to the justice system. A different judge gave Clary 30 months, which seems a tad lenient but not offensively so. I certainly don’t think Steve Clary is likely to commit any more federal crimes.
As Judge Holmes said, Clary’s situation — a law-abiding citizen who, when facing a financial crisis, accessed someone else’s money with the intention of paying it back later — is “not as unusual as you think.” Saying he’s sorry isn’t enough to deter someone else from making the same mistake as Clary.
As I waited for Clary’s sentencing hearing to start, I overheard a couple of his many supporters discussing the case. One asked the other if this would have “gone away” had the bank not “pushed it.” And the other said it would have.
It isn’t just in rape cases, then, that bystanders look for a way to blame the victim.
Gwen Moritz is editor of Arkansas Business. Email her at GMoritz@ABPG.com.