Onetime Real Estate Whiz Sentenced in Fraud Case : Courts: Sherman Mazur, who pleaded guilty to tax, bankruptcy charges, gets prison term, fine.
Sherman Mazur, a 1980s real estate whiz who pleaded guilty to tax and bankruptcy fraud after engineering what prosecutors alleged was one of the biggest tax fraud cases in recent years, was sentenced Wednesday to six years in prison and fined $250,000.
Mazur, 44, who once drove a Rolls-Royce and vacationed in Monte Carlo, stood in blue jail garb and showed no reaction as his sentence was handed down by U.S. District Judge Ronald Lew in Los Angeles.
Mazur had faced a maximum 31 years in prison and $1.75 million in fines after pleading guilty to seven counts of tax and bankruptcy fraud. His plea in early July--which also included an agreement to pay $500,000 in restitution--came five days before his trial was to start on a total of 74 criminal counts.
Mazur, a barrel-chested New York native with boyish good looks, declined to comment after the sentencing as he was handcuffed by U.S. marshals. His lawyer, Brian O’Neill, also had no comment.
The case against Mazur, who became a fixture in Southern California social and charitable causes as his wealth soared in the mid-1980s, centered around government allegations that he helped support his lavish lifestyle by diverting about $1 million to himself from some of the 200 real estate partnerships he ran--some of which were in bankruptcy.
Prosecutors also alleged that Mazur failed to report about $3 million in income to the Internal Revenue Service in 1985 and 1986, although Mazur admitted failing to report only about $413,000, according to O’Neill.
Mazur had been free on $400,000 bail since his indictment in 1991. But he was taken into custody Monday, when Lew originally had planned to sentence him.
Before he was held, Mazur told the court “how sorry I am for having caused all this pain, not only to my family but to those victims” who lost money investing in his partnerships. Mazur is married and has four children.
But Assistant U.S. Atty. Maureen A. Tighe told Lew that Mazur “should be punished for the greed he has shown.”
Prosecutors alleged that as Mazur’s success grew, he “had an out-of-control spending habit” in which he purchased a fleet of eight cars--among them a Rolls-Royce and a Ferrari--built multimillion-dollar houses in West Los Angeles and south Orange County and maintained a horse ranch.
Known as a charming, self-assured and persuasive man who didn’t mind dropping names of renowned business people he had met, Mazur gained notoriety as a rising star in the field of real estate “workouts,” in which he gained control of troubled properties with the understanding that he would restore their financial health.
Mazur at one point was managing about $750 million worth of apartments and office buildings he had obtained from troubled partnerships. He managed them through the now-defunct American Resource Corp. in Century City.
By 1988, he also was managing about 580 post office, utility and government buildings owned by investors in tax-shelter programs that had been promoted by Gerald L. Schulman, a North Hollywood businessman who was convicted that same year of felony tax fraud.
Mazur will be eligible for parole after two years, because his offenses occurred before late 1987, when sentencing guidelines were revised to require criminals to serve the majority of their jail terms.
Lew also ordered that the bulk of Mazur’s restitution payment be forwarded to the bankruptcy trustees now settling the affairs of American Resource and certain other Mazur firms.
