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Friday, Nov 30, 2012 8:15 AM UTC

Ex-Nat’l Lampoon CEO to be sentenced in fraud case

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Topics: From the Wires,

INDIANAPOLIS (AP) — A former chief executive of National Lampoon and two co-conspirators face possible life sentences Friday after being convicted of swindling investors out of about $200 million.

U.S. District Judge Jane Magnus-Stinson is set to sentence Timothy Durham, James Cochran and Rick Snow following their June convictions on fraud and conspiracy charges.

A jury found each man guilty of securities fraud and conspiracy. It also convicted Durham, a major Indiana Republican Party donor who resigned his National Lampoon post in January, of 10 counts of wire fraud, while Cochran and Snow were convicted on some of those counts.

Prosecutors have said the three stripped Akron, Ohio-based Fair Finance of its assets and used the money to buy mansions, classic cars and other luxury items and to keep another Durham company afloat. The men were convicted of operating an elaborate Ponzi scheme to hide the company’s depleted condition from regulators and investors, many of whom were elderly.

Durham’s attorney, John Tompkins, argued at trial that Durham and the others were caught off-guard by the economic crisis of 2008, and bewildered when regulators placed them under more strict scrutiny and investors made a run on the company.

U.S. Attorney Joe Hogsett said none of the three has shown remorse for their crimes and each deserves the life sentence recommended in a probation report.

“The emails and wiretaps introduced at trial show a brazen disregard — indeed contempt — for the largely working-class people that made up the majority of Fair’s investors,” Hogsett said in a sentencing memorandum submitted earlier this week.

“Durham has earned a place among the greediest, most selfish and remorseless of criminals,” Hogsett wrote.

However, Snow’s attorney, Jeffrey Baldwin, in his sentencing memo this week, pointed out that former Enron Corp. CEO Jeffrey Skilling was sentenced to less than 25 years in prison after his convictions on 29 counts of fraud and conspiracy and that former WorldCom Inc. CEO Bernard Ebbers was sentenced to 25 years in prison after being convicted of nine felonies including securities fraud in a loss of more than $1 billion.

Attorneys for Baldwin and Cochran have asked for lower sentences than those recommended.

Tompkins has asked that Durham be sentenced to three years in prison and two years of home detention.

The charges against Durham led several GOP politicians, including Indiana Gov. Mitch Daniels, to return hundreds of thousands of dollars in campaign contributions sought by Fair Finance’s bankruptcy trustee.

More By Ken Kusmer.

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