4-Year Sentence Given for Investment Fraud : Courts: Former president of First Pension in Irvine is also told to repay $74 million to investors, some of whom call term too short.

Valerie Jensen was sentenced Wednesday to four years and three months in prison for her role in an investment scam and ordered to repay $74 million to thousands of elderly clients who were cheated out of their pension money.

As the former president of First Pension Corp. in Irvine, in which investors lost more than $136 million, Jensen had faced as much as 10 years in federal prison. U.S. District Judge John G. Davies reduced the sentence based on Jensen’s extensive cooperation with the U.S. attorney’s office in its investigation of the company.

Without her cooperation, Jensen’s lawyer said, prosecutors might have spent years uncovering the operations of First Pension, an elaborate Ponzi scheme.

“Many of the diversions would not have been discovered,” Donald Smalz said. “Her assistance ensured the guilty pleas of the other two co-defendants.”

Jensen, Robert E. Lindley and William E. Cooper admitted in August that they misled clients into investing in nonexistent mortgages and took money from new investors to make payments to earlier ones.

Cooper, the founder of First Pension, was sentenced last month to 10 years in federal prison, the maximum term allowed under his plea-bargain agreement with the government. Lindley, the fund’s chief financial officer, was given a nine-year term. They were ordered, along with Jensen, to repay $74 million--the amount investors put into the mortgage investments.

In an unusual moment during Wednesday’s court proceedings, Michael Aguirre, a lawyer representing defrauded investors in four separate class-action lawsuits, requested that Jensen not begin her sentence until May 30 so that she may continue to assist in his investigation.

“In 20 years as a lawyer prosecuting white-collar crime cases, I have never stood up for a defendant, but I am motivated by her extraordinary assistance,” Aguirre said. “I am afraid that, if she were put in prison immediately, it would be difficult to continue to put the case together.”

Aguirre’s request was granted by Davies, who agreed that Jensen’s continued participation in the investigation may be investors’ only hope of recovering lost money.

Before her sentencing, Jensen addressed the court, expressing her desire to continue cooperating.

“I cannot explain my decision to participate in this act of fraud,” Jensen said. “I am filled with shame and guilt. It does not define my nature and character. I would like to say to the investors, some of which I know are here today, that I am doing everything in my power to recover their money.”

A handful of retirees, seated together, were on hand. Despite Jensen’s efforts to uncover crucial documents for the prosecution, they said, the punishment was too lenient, considering the magnitude of the fraud in which she was involved.

Candy and Bill Rendall of Chino Hills said they had 14 years’ worth of savings, more than $100,000, invested with First Pension. “Fifty-one months is not enough,” said Bill Rendall, 67. Because of the couple’s losses, he said, he and his wife, who is 68, are looking for work instead of enjoying their retirement.

“None of their sentences were enough,” Bill Rendall said of the First Pension principals. “They destroyed thousands of lives.”