The 724 victims were mostly retirees, people with nest eggs to invest but not enough to gamble with their money. The people who sold them were radio pitchmen and financial advisers, good talkers all, who spun a $195 million currency investment scheme out of the Van Dusen mansion in downtown Minneapolis.
Three major players behind the state's second-largest Ponzi scheme were sentenced Thursday to a total of 57 1/2 years in prison and ordered to pay more than $155 million in restitution. Jason "Bo" Beckman, described as a kingpin, received 30 years in prison. Co-conspirator Gerald Durand got 20 years. And Christopher Pettengill, who testified for the prosecution against his former colleagues, got 7 1/2 years instead of the 20 to 30 years the judge said he would have faced if he'd gone to trial like the others.
The sentencing of a fourth defendant, Patrick Kiley, was postponed after Kiley spoke for nearly an hour, dropping a bombshell at the end by accusing his attorney of misconduct.
Nine of the jurors who convicted the men attended the 10-hour hearing in Chief U.S. District Judge Michael Davis' packed Minneapolis courtroom. Their reaction?
"Not enough [prison] time," several said, declining to give their names.
A number of victims testified about the devastation the scheme caused on their finances. Bette Wager, 86, told how she was lured to invest by Kiley's radio program, "Follow the Money." Kiley and one of his pitchman said her earnings wouldn't be taxed and could be withdrawn at any time, she said.
"This was a dream come true," Wager said. "But I lost it all. I can't afford to go to the doctor any more. I was hoping Beckman would get 50 years. I just pray I can get some of my money back."
Prosecutors called it the worst scam in state history -- worse than Tom Petters' far larger $3.65 billion scheme -- because the people targeted by the con men were in their 60s, 70s and 80s.
Kyle Garman, a former pitchman for the scheme, wept as he described how he got more than 25 members of his own family to invest, some of whom also were left wiped out.
He said the investors were all "good, solid human beings that were taken." They weren't greedy, he said. "They put their trust in me and I thought I was doing the right thing."
Mary Patterson said she and her husband, Mike, lost more than $440,000 that they'd saved over 40 years.
As Christians, she said, they must forgive the defendants. But the guilty must still pay a price, she said, urging Davis to "punish them to the full extent of the law."
Beckman, 43, addressed the court for 40 minutes, often times gasping for air and choking down tears. He denied knowing that it was a Ponzi scheme, and said several of his relatives lost money because he recommended they invest in it.
"Was that part of some big show? Are you kidding me?" he said.
After the complicated currency investment program concocted by Burnsville money manager Trevor Cook collapsed, Beckman said, he was the only person involved who stuck around to try to help investors recover their money.
He said that he hired lawyers in Switzerland and the United States and traveled to Panama in an effort to find and recover their funds.
"I cannot admit to something I didn't do," said Beckman, asking to be allowed to return to his family. He then turned around, pointed at his wife in the gallery and yelled, "I can't breathe without her!"
Facing Davis, he stepped back from the podium and dropped down on one knee, asking for mercy.
Afterward, Davis said Beckman's overwrought statement proved that "some people should not have access to the English dictionary. You have used the English language to do violence to so many," Davis told Beckman. "It is not a gun. It is worse than a gun."
Assistant U.S. Attorney David MacLaughlin described Beckman as "dishonest, venal, manipulative, grandiose in his view of himself ... and maybe borderline delusional." Yet Beckman excelled at gaining victims' trust, MacLaughlin said.
"I would submit that Mr. Beckman is the worst white-collar defendant in the history of the District of Minnesota," he said. "I've never seen a more pro-active liar." He said Beckman even tried to use lawyers and other experts to hide his crimes.
Drama grips courtroom
Beckman, a former Anoka High School hockey star, owned an advisory firm called Oxford Private Client Group and was a partner in Cook's currency trading firm, Oxford Global Advisors. Cook previously pleaded guilty and is serving a 25-year prison term.
Durand, the co-defendant from Faribault, told Davis that he was duped by Cook and put too much faith in Pettengill, 56, an experienced financial adviser.
"I didn't know anything that was going on or that money was missing," said Durand, 61. "I'm at peace with myself."
Assistant U.S. Attorney Tracy Perzel said Durand started early in the conspiracy and stayed late. She said he bailed out when he smelled trouble, but never informed his investors or authorities.
Kiley's attorney, H. Nasif Mahmoud of Stone Mountain, Ga., said his client deserved a light sentence because of his age -- 74 -- and infirmities. Kiley then took the stand and insisted that he had been in "la-la land" during the scheme.
"I feel a great responsibility for a lot of pain and suffering that will go on in the next generation of the families," he said. Then, in a booming voice, added: "Now how would you like to have that when you lay in bed at night?
"I hope you will forgive me. I did not mean to hurt you."
Davis called off the sentencing hearing after Kiley claimed that he'd never been shown his pre-sentence investigation report.
Kiley then accused Mahmoud of posting self-aggrandizing statements about his representation of Kiley on a website without his permission.
Judge Davis relieved Mahmoud of his duties and said he'd appoint a public defender.
Pettengill admitted he made a critical mistake when he failed to report the fraud when he discovered it in 2008. He said he thought he could rectify it to get back his own $1 million investment as well as the investors' money. He apologized to his family, friends, and the government.
"Absolutely, most of all, I apologize to the victims," he said. "I am eternally sorry."