Ex-Defense Official Thayer Gets 4 Years in Stock Case

A federal judge today sentenced former Deputy Secretary of Defense Paul Thayer and his friend, Dallas stockbroker Billy Bob Harris, to four years in prison for giving false information to the Securities and Exchange Commission during an investigation into their insider trading.

U.S. District Judge Charles R. Richey also levied fines of $5,000 each on Thayer and Harris and ordered them to surrender to the U.S. Bureau of Prisons in Texas by 1 p.m. next Monday.

Each man had faced a maximum five-year sentence and a $5,000 fine on the one count of obstruction of justice to which they had pleaded guilty.

With Thayer’s wife, Margery, in the front row, his lawyer, Robert Fiske, argued for clemency for his client, citing his “devotion to family.”

Nest Egg for Girlfriend

The attorney said Thayer committed the crimes not out of personal greed but “to provide a small nest egg” for his girlfriend, Sandra Ryno, 39, of Garland, Tex., who he said was “increasingly reluctant to take large gifts of cash” from Thayer.

Rejecting arguments that the two men should be given probation and do community service, Richey said he sent them to prison “to maintain the integrity of our system of justice.”

Former President Gerald R. Ford, Sen. Barry Goldwater and Gen. John Vessey, chairman of the Joint Chiefs of Staff, had asked Richey to be lenient on Thayer.

Thayer, 65, and Harris, 45, earlier agreed to pay the government more than $1 million to settle a civil suit stemming from the insider stock trading scheme.

Thayer, who resigned from the Pentagon in January, 1984, and Harris pleaded guilty on March 4 to obstructing justice by giving false testimony in a scheme that netted Harris and seven associates $2 million in 1982.

Likely to Serve Year

Although each technically could be eligible for parole in 60 days, prosecutors said they believe the pair will have to serve at least a year of the sentence and possibly more.

Thayer and Harris stood motionless next to their attorneys as Richey pronounced the sentence before a crowded courtroom. Leaving the courthouse, Thayer declined to comment. Harris was not available for comment.

U.S. Atty. Joseph diGenova told reporters that the sentence will “serve as a strong signal of deterrence to brokerage houses and board rooms, the business community and to Wall Street that we are serious about white-collar crime.”

“We believe it was an appropriate sentence,” he said.

The government had charged that Thayer, while chairman and chief executive officer of the LTV Corp. in Dallas and a member of the board of directors of Anheuser-Busch Co. Inc. of St. Louis and Allied Corp. of Morristown, N.J., passed confidential non-public information to Harris, then a stockbroker in the Dallas office of A. G. Edwards & Sons Inc.