Bryan Reichel sat passively Tuesday and listened to a federal prosecutor call him a liar, then to his defense attorney call him “a decent man.”
He listened to descriptions of his lavish lifestyle, his big house and his gun collection, then to a passionate recounting of how he had started the PureChoice air and water filtration company in 1992 and eventually lost it all.
He listened to a demand for his conviction on a slew of fraud charges, then to a plea that he must be found not guilty.
After hearing those closing arguments Tuesday, a jury now is weighing whether to convict Reichel, 61, on a dozen counts of wire and bankruptcy fraud.
Reichel was indicted in 2014 on allegations that he lied to investors to get them to fund his start-up company and enrich himself. Then last year, the grand jury added five charges alleging that after PureChoice fell apart in 2011 and Reichel was fired, he tried to defraud the bankruptcy court by hiding assets and then lying about it.
In his closing argument, Assistant U.S. Attorney Joseph Thompson returned to a refrain the prosecution used repeatedly to describe Reichel’s business dealings: “Cut me a check.”
“[Reichel] didn’t act for the benefit of the company and its shareholders,” Thompson told jurors. “He acted for the benefit of himself.”
For years, Reichel solicited investments in PureChoice from individual investors who believed that the company was developing and selling air monitoring equipment to the commercial, industrial and government market. Those loans — intended to be short-term “bridge loans” to get the company off the ground — were repeatedly used to pay off previous investors or to enrich Reichel and an investor named Richard Perkins.
Perkins, who in the 1990s was a nationally known investment adviser, was described by federal prosecutors as an unindicted co-conspirator. They said their e-mails showed that both men clearly knew that they were engaged in a Ponzi scheme.
Between 1992 and 2011, PureChoice investors lost a net total of about $25 million, according to government court filings.
During his nearly 90-minute closing argument, Thompson pointed to e-mails showing that, at times, Reichel asked PureChoice staffers to write him checks within hours of telling investors that he couldn’t repay their loans.
“There was always enough money to pay [Reichel],” Thompson said. “That was the scheme.”
Money Reichel took out of the company funded an indulgent lifestyle, including a several-thousand square-foot house, a gun collection, high-end yard tractors and skid loaders and a Mercedes-Benz S Class Sedan.
Reichel’s defense attorney, Peter Wold, turned attention away from Reichel’s lifestyle in his closing argument and pointed instead to the wealth of PureChoice investors. Wold described them as “the 1 percent,” a group of rich men hoping to get richer when PureChoice made it big.
These investors had access to financial disclosures showing the company’s consistent losses and enormous debts, he said, and had more than enough business sense to know what they were doing by continuing to invest.
“This is not a case where an elderly couple gets duped out of their life savings,” Wold said.
He described Reichel as a man fully invested in his company, and in his dreams for its success. Any money that he or Perkins pulled out of it was owed to them, Wold said. When Perkins e-mailed Reichel asking for cash to buy a condo in Belize, he said, it was because he’d given PureChoice a two-week, $150,000 loan to help make payroll.
It was Reichel who was victimized, Wold said.
Father and son George and David Anderson, who according to government court filings lost about $12.3 million in PureChoice investments, pushed Reichel out of the company and took over its intellectual property for their own benefit, Wold said. Then, when Reichel declared bankruptcy, he said, the Andersons fed false information about the extent of his assets to the bankruptcy court.
Wold said that Reichel’s bankruptcy attorney compounded his problems by failing to prevent him from making mistakes in his filings — including his failure to disclose property and spending his $25,000 tax return instead of turning it over to the court.
“Bryan lost everything,” Wold said. Pointing at the two prosecutors, he added, “And they just step on him again.”
Thompson, in a passionate rebuttal, reiterated the government’s view that Reichel had used PureChoice as his personal piggy bank, with no intention of paying back his investors.
“Mr. Reichel paid himself again and again when other people weren’t getting paid,” Thompson said. “When you try to cheat people again and again, you can’t blame them.”