Judge Garaufis Explains How He Determined Restitution – Including Plan to Award DOS Slaves $312 Per Day For Readiness Drills

Approximately 100 individuals submitted claims for restitution in the case of the USA v. Keith Alan Raniere, a man convicted of various federal felony crimes and sentenced to 120 years in prison.

These hopeful victims sought a total of over $33 million.

The US Attorney’s Office for the Eastern District of NY [Prosecution] initially recommended the court award over $6 million to a total of 25 victims – about half of which the prosecution recommended be paid to the family of the late Morris and Rochelle Sutton, who once were sued and countersued NXIVM for legal fees.

The Sutton family’s claim of victimization was that during their lawsuit, NXIVM leaders altered a videotape before it was turned over in discovery – the alteration being the removal of some claims made by Nancy Salzman about NXIVM – and then made the tapes look like they were unaltered.  Mark Vicente, who had a hand in the surreptitious video editing, provided this evidence and testified for the prosecution. It resulted in a predicate act of the racketeering charges.  The Suttons argued that had they not been so deceived they might have saved about $2.8 million in legal fees, a preposterous claim.   But it was a claim the prosecution bought into and fully supported.

All told, Judge Nicholas G. Garaufis decided to award just under $3.5 million to a total of 21 victims including a drastic reduction to the Sutton Family from $2.8 million to $250,000. Of the 21 victims that Judge Garaufis approved for restitution, 17 were lower-ranking DOS slaves. The other four were Daniela, her sister Camila, [Camila was a first-line DOS master and, therefore, not a lower-ranking DOS slave], James Loperfido, whose email account was hacked, I believe by Daniela, and the Sutton family.

The judge also eliminated some of the prosecution’s recommended victims including those who had been the target of prior lawsuits by NXIVM/Raniere/Bronfman such as Toni Natalie, Barbara Bouchey and Susan Dones. While he sympathized with their plight, he said that by law he could not legally authorize restitution for crimes Raniere was not convicted of and he was not convicted of abusive litigation.

This is Judge Nicholas G. Garaufis’s order on restitution.

In it, the judge determined that anyone who was not fond of their pubic brand – which contains the initials of Keith Raniere – would, if they chose, be entitled to $2,500 for past or future surgery to have it removed.

It may have been wise, or it may have been stupid, to have branded women on their pubis with the initials of Keith Raniere, but it was one of the most significant factors in the case against Raniere.

It may have been sweet at the time to have women unwittingly sporting his initials on their crotches, but it turned bittersweet – as the prosecution used it as a key point in their prosecution.

What Is Restitution?

Judge Garaufis chose to award restitution under two federal statutes: the Trafficking Victims Protection Act of 2000 (“TVPA”) and the Mandatory Victim Restitution Act of 1996 (“MVRA”).

Four of the offenses of Raniere’s conviction are, the judge found, “covered offenses” under the TVPA:

1. Two counts of sex trafficking,
2. One count of sex trafficking conspiracy,
3. One count of forced labor conspiracy.

Judge Garaufis determined that “any lower-ranking DOS member, or ‘slave,’ whose commitment to DOS was secured by collateral and who engaged in a sexual act at the behest of a DOS ‘master’ is a victim of the sex trafficking conspiracy offense.”

He also determined that “any lower-ranking DOS ‘slave’ … who performed uncompensated labor or services at the behest of a DOS ‘master’ is a victim of the forced labor conspiracy offense.”

He went further and ruled that lower-ranking DOS slaves, whose command it was was to wake up at any hour day or night to respond to so-called “readiness drills” – being required to respond to texts from their masters within a minute of being texted – are to be compensated at $13 per hour – 24 hours per day, seven days per week – for their tenure as DOS slaves.

Three of these lower-ranking DOS slaves – Nicole, Jessica Joan and Sylvie – testified at Raniere’s trial

Four more women  –  Jane Doe 6 [a DOS slave under Lauren Salzman, whose first name is Audrey], India Oxenberg, Sarah Edmondson, and Amanda [A DOS slave, under Salzman, who is also a lawyer] – were mentioned at trial and the judge found they “clearly qualify as victims on the basis of the trial record alone.”

The other 10 victims, who submitted sworn affidavits describing their involvement with DOS, the judge found, described experiences in DOS that “are consistent with those that were described at trial.” The judge determined these were also victims.

He wrote “The trial record establishes that all or virtually all lower ranking DOS slaves were victims of a conspiracy to obtain forced labor, and that many of them were also victims of a sex trafficking conspiracy. Accordingly, the court credits these ten individuals’ unrebutted sworn testimony that they were lower ranking members of DOS and, as such, performed unpaid work, and in some cases sexual acts, at the direction of higher-ranking members,” the judge wrote.

Medical Expenses Awarded

The judge decided to award restitution for medical expenses caused by these 17 women’s membership in DOS and that included “past and future mental health care proximately caused by victims’ membership in DOS.”

Significantly, the judge ruled that “the victims’ membership in DOS proximately caused the full extent of their mental health care needs, even where prior psychological injuries arguably existed, because Mr. Raniere and his co-conspirators exploited, reopened, and exacerbated latent preexisting injuries.”

The judge ruled that “Raniere is responsible for causing the full extent of DOS victims’ mental health care needs” as he “held a principal role in the causal process, as the predominant inflicter of psychological injury.”

Mental Health Experts Had to Provide Evidence

The judge chose to award restitution for “future mental health care only where a qualified mental health professional has estimated the cost of necessary care arising from a victim’s involvement with DOS. Where a qualified mental health professional has given a range for the estimated cost of future mental health care, the court uses the midpoint of the range.”

The judge also awarded restitution for “Nxivm-related expenses, including tuition and travel costs, but only insofar as the victim’s participation in the relevant Nxivm programming was proximately caused by her membership in DOS because, for example, her DOS ‘master’ required her to attend a specific course.”

The judge also awarded restitution for legal fees incurred in connection with the investigation and prosecution of the case, insofar as claims for legal fees were supported by submissions from the victims’ counsel attesting to the work performed, hours billed, and relevant rates.

Here, attorney Neil Glazer, who represents many of the DOS women in a civil lawsuit, may have gotten an opportunity to be paid for the many hours he spent with DOS and other NXIVM women in connection with the prosecution of this case.

Nicole, Daniela, Jessica Joan, and others who did not testify, but were prepared to testify, were represented by Glazer.

Work for Which They Were Not Paid – Will Be Paid in Restitution

The judge chose to award restitution for “uncompensated work and services performed in connection with a victim’s membership in DOS.”

The prosecution proposed that the restitution should be calculated as the average hourly wage for the closest job classification from New York State’s Bureau of Labor Statistics.  The judge agreed with this recommendation.

This included using the average hourly wage for the job classification “personal care and service worker, which is approximately $13, to calculate the value of DOS slaves’ around-the-clock commitment to be responsive to the demands of their masters. The court finds that the defendant benefited from the expectation of DOS slaves’ constant availability, enforced through so-called ‘readiness drills.'”

“….  the requirement that DOS slaves be perpetually available to their masters, and in some cases to Mr. Raniere, facilitated the sex trafficking and forced labor conspiracies by instilling in the victims a sense of subservience and a lack of agency that permeated every aspect and hour of their lives….  Mr. Raniere required DOS slaves to meet him for sexual encounters at all hours of the day and night – again, facilitated by the expectation of their constant availability….  the court finds that it is appropriate to compensate DOS victims for the 24-hour nature of their obligation.”

The 17 DOS slaves will then be paid for the 24-hour nature of their obligation to be on call for readiness drills and paid at the same rate as a personal care and service worker who is on call – at the sum of $13 per hour, or $312 per day, or $9,360 per month, or $112, 320 per year.

The judge decided in no uncertain terms that the DOS lower ranking slaves – at least those who applied as victims would be paid.

It is curious though – since only 17 apparently applied and were approved. There were over 100 DOS slaves and even if we subtract the eight First Line Master who did not qualify, that still leaves over 90 lower ranking DOS slaves.

The vast majority of DOS slaves did not file victim statements – which begs the questions of whether or not they thought they were victims – or just preferred not to be further involved in the process and whether considering the $112,000 annual compensation for being a DOS slave – awarded by the judge – if they had any regrets on that score.

Raniere Must Return Collateral but Not Yet

The judge also wants Raniere to return the collateral.  The judge wrote, “…that all lower-ranking DOS members are statutorily entitled to the return of their collateral, and it orders Mr. Raniere to effectuate that return to the fullest extent practicable”.

Raniere’s lawyers objected to this, raising the concern that requiring Raniere to locate and get rid of the victims’ collateral may violate his Fifth Amendment right against self-incrimination since Raniere is appealing his conviction and may gain a retrial.

The judge rebutted that “The Second Circuit has previously rejected the argument that an order directing a defendant to return ill-gotten property to victims… violates the defendant’s Fifth Amendment rights.”

But decided to go along with the Raniere defense team’s request and stayed the requirement that Raniere must return the collateral out of an “abundance of caution.”

Raniere ‘s “obligation to effectuate the return of the victims’ collateral [is stayed] until the exhaustion of his appellate rights on direct appeal. Within sixty days of the exhaustion of such rights, he must effectuate the return of all original and duplicate copies of DOS victims’ collateral or….  file a letter with this court establishing that he has made all reasonable efforts to effectuate the return of the collateral and setting forth a detailed plan and timeline for returning all outstanding collateral to the fullest extent practicable.”

During the restitution hearing, Raniere said he does not have any collateral or know of its location.

Frank Parlato