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Ponzi schemer gets 68 months
By PETER H. MILLIKEN
CLEVELAND
A man who pleaded guilty to mail fraud in a Ponzi scheme that defrauded more than 200 people of some $9.3 million has been sentenced to five years and eight months in federal prison — and ordered to make full restitution.
David J. Harriett, 61, of Medina, formerly of Howland Township, drew the sentence Tuesday from U.S. District Judge Kathleen M. O’Malley.
Some of Harriett’s victims gave victim impact statements during the two-hour sentencing hearing; and each statement was followed by applause from about three dozen spectators, which the judge neither interrupted nor discouraged.
“The only thing I regret is we’re not here for an execution hearing,” said Judson Flint, adding that his financial losses in the scheme put a strain on his marriage. “Our retirement is down the drain,” he said. “Harriett, you’ll get what you deserve.”
Harriett, who retired in 2006 as a General Motors Lordstown executive, misrepresented to potential investors in the scheme that he had contracts to develop and build McDonald’s and Pioneer Chicken franchise restaurants.
“I feel like I have met Satan ... I fell victim to this devil in disguise,” said Patricia Rogan, another of Harriett’s victims. “He misrepresented everything. ... It was all a big lie,” Rogan said, adding that the financial losses she suffered were devastating to her family.
“This man is a thief and a liar. ... I am now broke” because of his crime, said 68-year-old Maxine Savel. “He’s ruined my life,” Savel said. With her life savings lost and Social Security as her only income, she’ll be forced to return to work, Savel said.
“I pray to God that you wear that yellow jumpsuit the rest of your life,” Savel concluded.
“You will not receive any sympathy from me,” Melissa Hock told Harriett. Hock said she took a General Motors buyout in 2008 and that her husband lost his job. Saying Harriett destroyed their retirement savings, she urged the judge: “Please confine him for the maximum time.”
The judge said that before he enters prison, she’ll allow Harriett to finish up to three months of treatment for pancreatic cancer that has spread throughout his body. That’s because Harriett is taking the chemotherapy drug Sutent, which the U.S. Bureau of Prisons does not administer.
The judge said she would forward Harriett’s medical records to BOP and recommend that he be placed in a prison medical facility.
Harriett’s lawyer, Timothy F. Sweeney of Cleveland, asked the judge to put Harriett on house arrest and not send him to prison.
Sweeney said house arrest would enable Harriett to continue his treatment for terminal cancer at the Cleveland Clinic and to receive hospice care when he needs it.
Dr. Robert Pelley, a Cleveland Clinic cancer specialist treating Harriett, testified Harriett likely will die within the next two years. However, he said he couldn’t give a specific time frame. “These diseases grow in a very sporadic and unpredictable fashion,” Dr. Pelley testified.
Bridget M. Brennan, the assistant U.S. attorney prosecuting the case, called for a 63- to 78-month prison term for Harriett.
Brennan said Harriett promoted “one of the purest Ponzi schemes” she had ever seen and caused severe financial harm to “really hard-working people.” Under her cross-examination, she got Dr. Pelley to acknowledge that doctors told Harriett in 1997 that his cancer eventually would be fatal.
Despite receiving that diagnosis and prognosis 13 years ago, Harriett continued the Ponzi scheme, Brennan told the judge.
An aggravating factor in this crime is that Harriett used his position at General Motors to recruit more investors to become Ponzi scheme victims, the judge said.
Wearing a business suit, a gaunt-looking Harriett sat hunched over before court, his head bowed and his hands crossed on the defense table in front of him, assuming an attitude of prayer and atonement.
“What I did was wrong,” an apologetic Harriett said after turning to face his victims on the courtroom’s spectator benches. “The hurt I caused you probably can’t be measured.”
Harriett told his victims: “I’ll live with this pain that I’ve caused you for what little time I have left.”