Ex-CEO Gets 3 Years for Defrauding Investors

Paul R. Safronchik, the former chief executive of the now-defunct Home Theater Products International Inc., was sentenced Monday to three years in federal prison for a scheme in which his company logged millions of dollars of bogus sales.

Prosecutors said investors in the Anaheim company lost more than $20 million as a result of the scheme.

Safronchik, 37, of Aurora, Ore., also was ordered by Judge Gary L. Taylor to pay $300,000 in restitution to investors. Safronchik previously pleaded guilty to criminal conspiracy, bank fraud and securities fraud.

Home Theater Products, a manufacturer of home theater electronics products and furniture, went public in 1994. The company’s outside auditor later discovered that 75% of its sales were bogus and resigned.

Safronchik, a former Irvine resident, admitted in his guilty plea that by the end of the company’s first fiscal year, June 30, 1995, much of its $12 million in reported sales “simply did not exist.”

The company attempted to recover through bankruptcy reorganization, but the business eventually was sold off in pieces.

Two other executives have been convicted for their roles in the scheme.

Jerome Adamo, 62, of Buena Park, the company’s former president, pleaded guilty to insider trading. He was sentenced in May to six months of home detention, two years’ probation and 200 hours of community service. He was ordered to pay a $50,000 fine.

Douglas Roy, 29, of Pomona, the company’s former controller, pleaded guilty to conspiracy. He was sentenced in June to six months of home detention and three years’ probation.