Okay, so if he's been prosecuted for it and served his time, then he's fulfilled his debt to society, no?

It means "he's a self-made man" is a claim which needs to be shot down, and that's the claim that was being shot down.

How so? If he committed some crime, got convicted, did the time, then started a business and bootstrapped to success, how is that not a self-made man? A great many successful entrepreneurs (Branson comes immediately to mind) were criminals before they were successful.