David Marion, whose once highflying coin company bilked investors, many of them elderly, out of nearly $3.4 million, will spend the next five years in prison.

U.S. District Judge Patrick Schiltz imposed the sentence on Marion Thursday as a courtroom full of friends and tearful family members watched and Marion expressed contrition about a life gone wrong.

But Assistant U.S. Attorney Karen Schommer suggested Marion, 53, the former sole owner of International Rarities Corp., got off easy for his guilty pleas to charges of money laundering and conspiracy to commit mail and wire fraud.

"There is always more than one reason why a defendant commits a crime, but the result is the same," Schommer said. "Victims lose money."

Before his sentence was announced, Marion, dressed in a dark pinstriped suit with a blue shirt and white tie, told Schiltz that his criminal offenses "are a shame I live with every day."

"I will spend my days trying to make it up to my victims," Marion said. "I have learned that I must make amends, repent and change my behavior, even if it takes a lifetime."

At his plea hearing in February, the 6-foot-5, 265-pound Marion admitted that he and his sales staff sometimes used the customers' cash and coins for themselves, or to fulfill other orders. Some investors, alarmed by the financial crisis in 2008-09, sought safer investments to preserve their capital, and many turned to gold.

The Star Tribune featured Marion and his company in an investigative series published in 2011 on the Twin Cities coin industry. It described how some firms hire salesmen without regard to criminal backgrounds, including fraud, forgery, theft and even bank robbery. Marion himself, however, had no criminal record.

Following the stories, the Minnesota Legislature passed a law that requires criminal background checks on coin dealers and their employees, effective next year, and banning from the industry anyone with a conviction for a financial crime in the preceding 10 years. It also imposed bond requirements and certain consumer protections that took effect Aug. 1.

'A slick con man'

One of Marion's 57 victims was the late father of Susan Turner. He lost $400,000 that he had saved to take care of his family, including two mentally disabled sons.

In a letter written by Turner, and read in open court by Schommer, Turner called Marion "a slick con man" who stole money from her father and caused his decline in health and that of her late mother after the loss was discovered.

"I hope he receives the maximum punishment," wrote Turner, a Florida resident.

But Marion received less than the maximum punishment called for by federal sentencing guidelines. Under those guidelines, the recommended sentence for someone guilty of those crimes with Marion's background is 70 to 87 months, or slightly more than seven years maximum. Marion's sentence is for 60 months.

Painkillers, alcohol, gambling

The judge called the investor losses "huge" but acknowledged that Marion was remorseful and "resisted the temptation to blame others" for his crime. Marion is to pay restitution of $3.37 million.

"He lost his business, he lost his home, he has huge restitution to pay," Schiltz said in imposing the sentence. "No one can think Mr. Marion is getting off easy."

Schiltz noted, however, that Marion's pledge to assist federal authorities in other coin-industry investigations "did not rise to the level of substantial assistance" but said he gave Marion "credit for trying."

Defense attorney Craig Cascarano painted Marion as a successful businessman and dedicated family man whose life went awry after a series of knee surgeries led to a dependence on the painkiller OxyContin which was exacerbated by an addiction to alcohol and gambling.

"He took money to feed that addiction, which was threefold. That life literally destroyed him," said Cascarano, who requested an 18-month prison sentence for Marion. "The person that David is today is not the person involved in the criminal conduct."

But Schiltz called Marion's crimes "extremely serious" and noted Marion was earning up to $1 million as owner of his company.

"This was not a crime of impulse or a crime of desperation," Schiltz said. "The financial services industry in general and the precious metal industry in particular are rife with fraud."

International Rarities Corp. filed for Chapter 11 bankruptcy protection in August 2011 but was forced to liquidate last September after the SEC filed suit against Marion in March.

Staff writer Dan Browning contributed to this report.