Defendant Vanishes After Verdict

A Las Vegas man convicted Wednesday of scheming to cheat investors out of $16 million vanished during a 15-minute court recess after the verdict, federal authorities said.

U.S. marshals found Antonio Guastella five hours later in the lobby of a hotel in Manhattan’s theater district, said Marvin Smilon, a spokesman for U.S. Atty. Mary Jo White. When he saw the marshals, he began to run and was tackled outside the hotel.

Guastella, 49, disappeared shortly after a federal jury in Manhattan found him guilty of conspiracy, money laundering and wire fraud. The conspiracy conviction carries a prison term of up to 20 years.

His defense lawyer had asked for a brief recess after the verdict, during which the defendant apparently left the courthouse.

U.S. District Judge Shira Scheindlin issued a warrant for his arrest.

Guastella had been free on bail during the trial, which started May 14. The judge remanded his co-defendant, Robert Martins, who was also convicted in the scheme, to jail after Guastella’s disappearance.

Prosecutors said Martins, also of Las Vegas, operated a Web site through which he offered investors the opportunity to “rent” $1 million or more from a European bank on payment of a commitment fee of 3.5%. The “rented” funds were supposed to be placed in a “high-yield” investment program that paid investors a return equivalent to $5 million for each $35,000 rental fee paid.

From October 1997 to June 1998, dozens of investors entered into “rental agreements” with Martins’ company, Assets International Ltd., generally paying $35,000 to “rent” $1 million. About $16 million in fees were paid by investors to a brokerage account controlled by Guastella, prosecutors said.

Investors were told that First Mutual Sparkassa, a purported savings bank in Stockholm, would issue or had issued a letter confirming that it was holding $1 million in a custodial trust account in the investor’s name.

Four other defendants in the scheme previously pleaded guilty.