First Pension Chairman, 2 Partners Plead Guilty to Fraud

The chairman of failed First Pension Corp. of Irvine pleaded guilty in federal court Monday--and later said he felt “incredible remorse”--to cheating investors of $121.5 million.

William E. Cooper showed little emotion during the hearing before U.S. District Judge John G. Davies in Los Angeles, but afterward he broke into tears in a hallway outside the courtroom.

“It’s something you can’t live with,” Cooper said.

“I feel incredibly bad.”

Cooper, 50, of Villa Park, and his two longtime business partners, Robert E. Lindley, 51, of Laguna Niguel and Valerie Jensen, 47, of San Juan Capistrano each entered guilty pleas to two counts of mail fraud in connection with what has been described as one of Southern California’s longest-running investment scams.

The three were accused of creating a pyramid scheme that bilked many of First Pension’s 8,000 clients out of $66.7 million in direct investments and $54.8 in interest they otherwise would have accrued. Investors were enticed into phony second trust deed mortgage funds that the defendants on Monday admitted were shams from the start.

Each of the three faces a prison term of up to 10 years and fines of as much as $500,000. Davies scheduled sentencing for the trio for Oct. 6.

The small number of investors who came to watch the proceedings were hardly sympathetic.

“I would like to see him dragged away in handcuffs,” said Joseph Elia, 63, of Redondo Beach, who blames Cooper for the $100,000 Elia said he lost through First Pension.

Cooper told the judge that he knew by the end of the first year of operation in 1983 that he was breaking the law because the losses were so substantial “it was clear we had violated laws and were violating laws, and at that point we invested in other businesses in an attempt to bring money back into the business.” Lindley said he was pleading guilty “because I was involved in this scheme to hide losses from investors. I’m sorry I did it.”

Jensen told the judge that although she did not initially understand that she was participating in illegal doings, she became “swept away by events and willingly participated in the acts I’ve been accused of.”

Prosecutors said they will continue working with the three to recover lost funds.