Front, Malcolm 'Mac' Parker leaves U.S. District Court in Rutland, Vt., on Wednesday, Aug. 21, 2013, alongside his family and attorney John Pacht after being sentenced by Judge Christina Reiss to 55 months for defrauding hundreds of victims in a Ponzi scheme. (AP Photo/Burlington Free Press, Emily McManamy)
Before sentencing Malcolm “Mac” Parker to more than 4½ years in jail Wednesday, federal Judge Christina Reiss said she regarded the Vermont storyteller as a man suffering from two delusions.
Parker’s first misconception, she said, was that his silent partner in the misbegotten film “Birth of Innocence” was a “godlike creature” capable of astral projection and time travel who would deliver future lottery numbers to help pay back investors who devoted $28 million to the film.
The second delusion, she said, only became apparent near the end of the decade-long fraud when Parker said he realized that his partner, Louis Soteriou, wasn’t the immaculate spiritual guide he thought he was. When that realization hit home, Parker, who owed large sums of interest to investors in a vast Ponzi scheme that numbered 700 investors over the years, didn’t end his solicitations, the judge said.
Instead, he ramped them up, soliciting new investments and lying to state financial regulators out of a sense, as Parker told the court, of responsibility to pay other investors.
It was at that point, the judge said, that Parker went from being an arguably deluded victim to being a deluded predator.
“You deluded yourself into thinking that Mac Parker was a godlike creature who could do no wrong,” Reiss said. “You decided you were a good person, who has integrity and honesty and you decided to market those qualities and make money from it.”
Parker pleaded guilty in April to conspiracy to commit fraud and filing fraudulent tax return charges
Federal prosecutors asked Reiss to sentence Parker, 56, of Addison, to three years in jail based on the help he provided with the prosecution of Soteriou, who was sentenced to seven years in jail for his role in the fraud Monday.
But while the judge gave Parker some sentencing guideline credit for the assistance he provided — including testimony he gave Monday during Soteriou’s sentencing — the judge said she believed that prosecutors could have made their case without his help and, moreover, she said she had concerns that Parker hadn’t accepted full responsibility for his role in what Reiss described earlier this week as one of the biggest scams ever perpetrated in Vermont.
She ordered Parker to turn himself in to begin his prison sentence on Oct. 1 — the same day that Soteriou will begin his own prison term.
In statements to the court and to victims who crowded into the packed courtroom during the five-hour sentencing hearing Wednesday, Parker said he was taking responsibility for what he had done and promised to spend his life working to repay his victims — some of whom lost their life savings and retirement funds in the scheme.
During his statements, Parker, an author and public storyteller, had to pause to struggle with his emotions and he broke down in tears after the sentencing and was consoled by friends and family at the defense table.
“I was wrong and I did things that were wrong,” Parker said. “I believed in the unbelievable.”
On Monday, Parker told the court that he had placed his faith entirely in Soteriou, a spiritual mentor and healer whom he had known for years. The movie, which remains unfinished after utilizing only about $1 million of the funds raised on its behalf, was begun at Soteriou’s behest, he said, and proceeded largely under his direction even though Soteriou was thousands of miles away from its production for the better part of the decade.
“I see, unfortunately in retrospect, that the biggest blind spot and weakness in my character was believing that someone else knew better about my life than I did,” he said. “I gave my power to someone else but I did this. I’m responsible. I abandoned my own integrity, common sense and truth for what I believed was a higher truth.”
No restitution order has been set by the court yet, but Parker’s defense attorney John Pacht said his client planned to create a trust into which he would donate proceeds from his future creative projects — including his plans to complete Birth of Innocence and to work with a documentarian who wants to chronicle the creation of that movie.
Pacht also said the money trail in the scheme supported the argument that his client was less culpable than Soteriou with Parker utilizing about $700,000 of the investors money to pay his bills while Soteriou received about $3.8 million for “spiritual research” that was actually used to pay for luxury hotel rooms, expensive cars and other amenities.
But Reiss made it clear from the beginning of the hearing that she had doubts about Parker’s relative culpability by asking both Pacht and Assistant U.S. Attorney Michael Drescher a series of detailed questions about the scam that she said wasn’t addressed while Parker was on the stand Monday.
Among other things the judge noted was that while Soteriou received the lion’s share of investor funds, Parker was the partner who solicited money by pursuing prospective investors — relentlessly, according to some of his victims. He also withheld not only Soteriou’s role in the enterprise but low-balled the amount of money already contributed and the number of investors already onboard.
Parker told the same lies to investigators with the Vermont Department of Financial Regulation who questioned him in October 2009 and, despite their insistence that he stop soliciting funds, Parker continued his fundraising activities after the meeting. The judge said he even asked investors who contributed after the meeting with state regulators to back date their checks to September out of a feigned interest in earning them quicker returns.
In reality, the judge said Parker was trying to hide his continued activity from state investigators.
“You could have given it up and said you were done with it,” the judge said. “Instead, you continued with the lies and the delusion of the Mac Parker brand.”
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