Burton Gets 10 Years for $50-Million Fraud

Financier Wayne Burton has been sentenced to 10 years in prison for his role in swindling about 6,000 investors out of at least $50 million on real estate trust deed sales through his San Bernardino-based United Financial empire.

State and local prosecutors had called his operations “a giant pyramid scheme” that added up to “the largest real estate brokerage fraud in California history.”

Burton, who has been in jail since he was convicted of 110 criminal charges last May, was denied bail pending his appeal of the maximum sentence levied last Thursday by San Bernardino Superior Court Judge Bob N. Krug.

San Bernardino Deputy Dist. Atty. Ken Kohne said Monday that Burton had not posted the $100,000 bond set after his conviction.

The U.S. District Court put Burton’s holdings under a receiver in March, 1981, at the request of the Securities and Exchange Commission. About the same time, the state Department of Real Estate revoked Burton’s real estate license.

Criminal charges were filed in May, 1982, in San Bernardino Superior Court.

Burton was convicted on charges of theft, forgery and tax and securities violations.

Kohne said after the conviction that investors, who originally were promised interest rates of 10% to 24%, are likely to get back no more than 23 to 27 cents on the dollar of their investments.

Of the perhaps $80 million taken in by Burton’s firms, more than $50 million has not been accounted for, officials said.

Burton had obtained some of the highest-price developments in downtown San Bernardino, as well as residential and commercial properties elsewhere in Southern California, at the peak of his operation in late 1980.