INDIANAPOLIS (AP) – An Indiana financier and former chief executive of National Lampoon convicted of swindling investors out of about $200 million was sentenced Friday to 50 years in prison by a judge who told him his “deceit, greed and arrogance” had cost many of his victims their life savings and dreams of a comfortable retirement.
U.S. District Judge Jane Magnus-Stinson said Timothy Durham had violated the trust of thousands of small investors from the American Heartland who had been careful with their money and invested it with him in hopes of traveling in their retirement, paying off their mortgages and perhaps buying a small home in Florida.
She told the court Durham had plundered their money so he could live a luxurious lifestyle.
“We drive Chevys and Buicks and Ford, not Ducatis. That’s how most of us roll,” Magnus-Stinson said. “When they’re defrauded, it is the most serious offense because it undermines the fabric of this country.”
Durham said he felt “badly” for all the families who lost their savings, but never admitted any wrongdoing.
“Of course I feel terrible they lost all their money. My family has lost all of its investments,” he said. “I feel very badly for all the people, especially the people here today.”
Durham, who was led into the courtroom in handcuffs and leg chains and wearing a gray-green prison jumpsuit, had no visible reaction when the judge pronounced his sentence. The 50-year-old rocked briefly in his chair afterward and fidgeted with a pen he held with his both his hands, quietly telling Magnus-Stinson “No, your honor” when she asked if he had any questions about his sentence.
But he appeared dazed as he was handcuffed and led from the room into the custody of the U.S. Marshals Service.
John Tompkins, Durham’s lawyer, did not immediately return a call for comment after the sentencing.
James Cochran, an associate of Durham, was sentenced Friday to 25 years in prison, while accountant Rick Snow received a 10-year sentence. Both Durham and Cochran were taken away in handcuffs to serve their sentences, but Snow was allowed to leave with his family, pending a determination on where he will serve his sentence.
A jury in June found the three men guilty of securities fraud and conspiracy. It also convicted Durham, a major Indiana Republican Party donor who resigned his post at National Lampoon in January, of 10 counts of wire fraud, while Cochran and Snow were convicted on some of those counts.
Prosecutors have said the three stripped Akron, Ohio-based Fair Finance of its assets and used the money to buy mansions, classic cars and other luxury items and to keep another of Durham’s company afloat. The men were convicted of operating an elaborate Ponzi scheme to hide the company’s depleted condition from regulators and investors, many of whom were elderly.
Tompkins argued at trial that Durham and the others were caught off-guard by the economic crisis of 2008, and bewildered when regulators placed them under more strict scrutiny and investors made a run on the company.
The charges against Durham led several GOP politicians, including Indiana Gov. Mitch Daniels, to return hundreds of thousands of dollars in campaign contributions sought by Fair Finance’s bankruptcy trustee.
Attorneys for all three men had asked the judge for lighter sentences than those recommended. Prosecutors had wanted 225 years for Durham, and Tompkins sought a total of five years _ three years in prison and two years of home detention.
Magnus-Stinson said she couldn’t give Durham the maximum sentence because it would be as “puffed up” as statements that he held $280 million in assets. But she noted that though he testified that he “felt terribly” for the victims, he had shown no sincere remorse.
Magnus-Stinson said she was unmoved by testimony about Durham’s generosity over the years, including giving to charities and also to political campaigns.
“It’s very easy to be generous if you’re using someone else’s money _ and that’s what was happening here,” she said.
U.S. Attorney for the Southern District of Indiana, Joe Hogsett, said Friday’s sentencing means families can finally begin putting their lives back together.
Barbara Lukacik, 74, an Ohio nun who said she lost $125,000 in the Fair Finance collapse, said she had forgiven Durham and the others but testified before the sentencing that a lengthy sentence was warranted.
“If you receive a short sentence _ a slap on the wrist, so to say _ I do not think it will be enough time for your heart and your conscience to realize your sin and your greed,” she said.
Jane Kalina of Wayne County, Ohio, testified Friday that her 86-year-old father lost more than $170,000 _ some of it from the sale of a family farm _ that he had invested.
She said after the sentencing that she was satisfied, and was particularly pleased by Durham’s lengthy sentence.
“I think he was the culprit and the sentence fits the crime,” she said. “We’re happy that he will be very old when he gets out.”
Associated Press writers Rick Callahan and Ken Kusmer in Indianapolis contributed to this story.
(Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)