Second Circuit Rules Wealthy Criminal Defendants Cannot Avoid Detention By Relying On Personal Funds To Pay For Self-funded Private Jails While Awaiting Trial

On August 1, 2019, The U.S. Court of Appeals in New York refused to overturn a bail ruling that kept Jean Boustani, a former lead salesman for Abu Dhabi-based shipbuilder Privinvest, detained pending trial. Following Boustani’s arrest in January, he was denied bail by a federal magistrate judge.

For months, Boustani argued for a proposed bail application that included a $20 million personal recognizance bond secured by $9 million in cash, 24-hour GPS tracking and 24/7 intensive monitoring by private armed security guards while awaiting trial for his role in an alleged $2 billion fraud and money laundering scheme.

The Second Circuit in United States of America v. Jean Boustani expressly held that the Bail Reform Act does not permit “a two-tiered bail system in which defendants of lesser means are detained pending trial while wealthy defendants are released to self-funded private jails.” The three-judge panel said it is “a fundamental principle of fairness that the law protects the interests of rich and poor criminals in equal scales, and its hand extends as far to each.” Furthermore, the panel held “to interpret the Bail Reform Act as requiring district courts to permit wealthy defendants to employ privately funded armed guards where an otherwise similarly situated defendant without means would be detained would violate this core principle.” Such a “two-tiered” system would lead to inequality and unequal treatment in favor of a small group of extremely wealthy defendants, the opinion states. However, the appellate panel said it may be appropriate to persuade a court to include private guards as a bail condition when the defendant’s wealth is the only justification for finding a flight risk. The panel explained that if a defendant would otherwise be released, but for his wealth, then a private security bail package may be fitting. PDF OF RULING HERE