A Wayzata couple behind a derailed Orono commercial construction project were each sentenced to a year in the Hennepin County workhouse Thursday for forging invoices from subcontractors to skim money from a $6.4 million bank loan intended for the construction.
Philip and Virginia Carlson were denied the option of serving the sentence on electronic home monitoring. They received a stayed 21-month prison sentence that would only be served if they break the law.
Philip Carlson, 58, was granted work release, and Virginia, 62, received permission for release to seek employment and medical furloughs. Both are prohibited from holding fiduciary positions in the real estate, construction or design industries.
Their "fraud and double-dealing created great hardship to many regular people while the Carlsons lived in splendor," County Attorney Mike Freeman said.
In August, the Carlsons were convicted of five counts of theft-by-swindle for taking hundreds of thousands of dollars from an office development project in Orono that was never completed. This theft played a role in the collapse of First Commercial Bank of Bloomington.
During the sentencing, the prosecution noted that Hennepin County did not think either Carlson was amenable to probation because they still do not accept responsibility for their crimes.
Acting against the advice of her lawyer, Virginia Carlson spoke at great length. She began with an apology that turned into a monologue about her life and struggles.
The Hennepin County attorney's office originally sought a longer sentence and is seeking $633,311 in restitution from the couple.
