Hernandez’s Bid for Release Denied : Courts: Judge rejects convicted socialite’s request to return to home detention while awaiting his scheduled Jan. 24 sentencing. She says no evidence exists that ‘he is not a flight risk.’

Sobbing before a federal judge, convicted socialite Danny Hernandez on Monday lost his bid to leave prison while he awaits sentencing for the disappearance of $8 million from a precious-metals firm.

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A pre-sentence report, disclosed in court for the first time Monday, recommends that Hernandez receive a six- to eight-year prison term. He and his wife, Susie, who was also convicted in the case, are scheduled for sentencing Jan. 24.

Susie Hernandez is not expected to receive jail time because the couple has two children and her role in the crimes is less prominent, authorities say. She has already pleaded guilty to income tax evasion.

In U.S. District Court on Monday, Hernandez asked to be returned to an electronic home-detention monitoring system, on which he was placed last September. The arrangement was revoked and Hernandez was placed in federal prison, however, when he fell $440 behind in payments for the cost of the monitoring system.

In opposing Hernandez’s request, prosecutors alleged that the couple hid or disposed of thousands of dollars in assets, including jewelry, custom household appliances and a membership in a San Juan Capistrano country club.

Such a pattern of concealment, the government alleged in court, strongly suggested that Hernandez was a flight risk and in violation of his plea agreement with the government.

“This defendant is simply unworthy of belief in any matter that touches upon his interest,” Asst. U.S. Atty. Stephen Wolfe told the judge. “With a pre-sentence report that urges six to eight years in prison, he might feel it is better to be elsewhere.”

Wearing glasses and blue prison garb, Hernandez dropped his head when U.S. District Judge Alicemarie H. Stotler denied his attorney’s motion to return him to home detention. Weeping, he turned and hugged the attorney, James T. Duff, before being led away in handcuffs.

At the last moment before departing, he turned to his wife, who sat in the courtroom, and mouthed the words, “I love you.”

Stotler said she had strongly considered sending Hernandez to jail in September but decided to allow him to wear an electronic bracelet.

“It might have been safer to have remanded (Hernandez) to custody at that time,” she said. “I cannot find clear and convincing evidence that he is not a flight risk.”

The judge also suggested that it was “flagrant and foolish” for Hernandez to assert that he could not pay for electronic monitoring, a cost “that seems modest based on the standards that have been set in this case.”

Hernandez was arrested last February after nearly $8 million was found to be missing from the precious-metals firm in Santa Fe Springs where he worked.

He was able to stay out of jail by pleading guilty to mail fraud and money laundering charges and, in a plea bargain, promising the government valuable information about his former employer, PGP Industries. He has alleged that some executives in the company encouraged employees to short-change customers, a charge executives vehemently denied.

Federal officials say Hernandez has been of limited help in their investigation of PGP and that throughout much of last year, Hernandez has continued to flaunt his lifestyle while pleading poverty.

For example, the same month last year that his wife requested a public defender because she said the couple had limited assets, Danny Hernandez chartered a jet for $7,800 to see the Final Four basketball tournament in New Orleans, court documents show.

During that same month, he took a trip to Las Vegas, paying $880 for his room and expenses. And during his last court appearance in September, he arrived in a Mercedes-Benz. Inside the courtroom, it was established that the couple still owns property in the Cabo San Lucas area of Baja California. Hernandez said his children still attend private school.

In an interview with The Times, Hernandez said the money obtained since his arrest was either earned honestly or came from loans from friends.

Because of Hernandez’s unauthorized wanderings, Stotler ordered in September that he be placed under house arrest, wearing an electronic bracelet that alerts authorities whenever he leaves home.

But when Hernandez failed to pay the cost of the monitoring device, Stotler issued a warrant for his arrest. He was placed in the Metropolitan Detention Center in Los Angeles the day before Thanksgiving.