Ex-First Pension Chief Gets 10 Years for Fraud : Crime: Judge gives William E. Cooper maximum term for running Ponzi scheme that bilked victims of $136 million.
Citing the “enormity of fraud” by the owner of a pension investment company, a federal judge in Los Angeles on Thursday sentenced William E. Cooper to 10 years in prison, the maximum amount allowed under his plea agreement, and ordered him to pay back $73.1 million to investors.
Cooper, 51, admitted that he swindled thousands of mostly elderly investors out of more than $136 million of their retirement savings through his First Pension Corp. in Irvine. Cooper, along with fellow First Pension operators Valerie Jensen and Robert E. Lindley, formally pleaded guilty last summer, admitting that he operated an elaborate Ponzi scheme in which clients were misled into investing in nonexistent mortgages and in which money from new investors was used to make payments to earlier ones.
Lindley, a certified public accountant, was sentenced to nine years in prison for his role in the scheme and ordered to also pay $73.1 million in restitution. Attorneys for both men signaled that they may appeal the decision. Jensen is scheduled to be sentenced March 8.
“Mr. Cooper crossed the line that separates legal from criminal behavior back in 1983,” U.S. District Judge John G. Davies said after handing down the sentence. “And he persisted in that behavior until the end. The result was the diversion of massive amounts of money, some which was paid generously to Mr. Cooper, Mr. Lindley and Ms. Jensen.”
Calling Cooper the organizer and leader of the First Pension scheme, Davies also said he gave Cooper the maximum term allowed under sentencing guidelines because Cooper “has failed to meet all his obligations under the plea agreement.”
Although Copper turned over about $3 million of his personal assets to federal prosecutors, the judge noted that he had refused to give up his $700,000 home in Villa Park and two condominiums in Maui. He instead gave title to the properties to his wife, Terri, who has recently filed for bankruptcy, Davies said.
Cooper, who arrived in court with his wife, sat impassively as the verdict was announced. About 20 investors who gathered in the courtroom were silent. Earlier, Cooper had apologized for his crimes, telling the court that he only kept the fraud going because he thought he could recover losses for investors.
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“I’m very sorry for what happened. I’m sorry for the incredible losses and devastation that I’ve brought about,” Cooper said, his voice cracking as he fought back tears. “I can’t describe to you the incredible anguish that I’m suffering. There isn’t a day that goes by that I don’t struggle with what I’ve done.”
Davies said he had received more than 80 letters from investors, whom he described as mostly elderly people of modest means, recounting tales of suffering and of great reductions in their standard of living because of the First Pension scam.
“The trail of damage is wide,” the judge said.
Joseph and Karmele Murray said they lost $120,000 invested with First Pension and drove nearly three hours from San Jacinto to witness Cooper’s sentencing. While the retirees said they feel better knowing Cooper will go to jail, they said they believe 10 years is not enough.
“Any other robbery and he’d be led away in handcuffs,” Joseph Murray said. “They’ve tried to portray him as a good guy. It’s horrible. He should be put in Pelican Bay,” the maximum-security prison in Crescent City in Northern California.
Davies ordered Cooper to report to prison March 20 and said he will recommend that both Cooper and Lindley serve time together in a prison in Nevada.
