Petters asks for four-year sentence

  • Article by: DAVID PHELPS , Star Tribune
  • Updated: March 24, 2011 - 9:42 AM

Government wants him put away for good, a request his lawyers called "absurd."

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Tom Petters

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If sentencing is a mathematical equation, then Wayzata businessman Tom Petters should only spend four years in prison.

That's the argument Petters' defense attorneys made in a brief filed Thursday in which they labeled as "absurd" the government's request for a 335-year sentence for investment fraud committed by Petters.

The government still wants Petters put away for good when a judge imposes a sentence next week.

Defense attorneys Paul Engh and Jon Hopeman based their sentencing calculation on the 150-year sentence handed to New York investment adviser Bernard Madoff, whose $65 billion Ponzi scheme dwarfed the $3.65 billion fraud headed by Petters.

Petters' defense attorneys said Madoff's sentence broke down to 2 1/3 years for each $1 billion in losses.

Using that ratio in the Petters case and placing actual losses at $1.8 billion as opposed to "paper" losses of more than $3 billion, Engh and Hopeman calculated that Petters deserved a sentence of just over four years.

Petters, convicted on 20 counts of fraud, money laundering and conspiracy in December, is scheduled to be sentenced by U.S. District Judge Richard Kyle on Thursday. He's been in custody and confined since he was arrested in October 2008.

Prosecutors filed their request for a lengthy prison sentence in early March and asked Kyle to impose it because of the breadth of Petters' Ponzi scheme and to send a message to future criminals.

"If nothing else, the argument is dehumanizing," Engh and Hopeman wrote. "We are to imprison this man into the 24th Century so the government will have a favorable citation for its [future] sentencing briefs? ... And who will serve the time? Will it be Mr. Petters' ghost?"

They also argued that a sentence of four years would be on par with the sentence given Hal Greenwood for his role in the multibillion-dollar collapse of Midwest Federal Savings and Loan some 20 years ago.

But in a response brief also filed Thursday, the government was unwavering in its defense of a 335-year sentence.

"The defendant makes no effort to address the staggering and unprecedented size and impact of his fraud on victims and the community," prosecutors wrote. "The defendant defiantly rejects personal responsibility. He is unrepentant."

The government said the economic impact of the crime was "staggering" and said it involved the betrayal of friends, family, business associates, charitable organizations and others.

But defense attorneys said more than 50 letters sent to Kyle in support of Petters show him as "a flawed but still virtuous human being" still loved by family and friends.

"From the quantum of letters alone, his life, Tolstoy would opine, has been a success," they wrote.

Prosecutors also disputed Petters' claim that he cooperated with the court-appointed receiver who dismantled the Petters business empire which once include Petters Group Worldwide, Sun Country Airlines and Polaroid.

David Phelps • 612-673-7269

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