Moved by a disbarred attorney’s responsibility to his Alzheimer’s-afflicted wife, a federal judge put off the defendant’s sentencing in a fraud scheme Monday while sending a co-defendant to a year in prison.
Steven Woods, 57, of Missouri, who pleaded guilty to aiding and abetting wire fraud, was sentenced to 366 days in prison by U.S. District Judge David O. Carter, who also ordered about $1 million in restitution.
Carter, however, put off sentencing for co-defendant Bruce Haglund of Irvine because his wife appears to be in the final stage of Alzheimer’s disease and he is the primary caregiver.
Haglund’s attorney, Dyke Huish, proposed sentencing his client to home confinement and then prison if his wife died while serving his punishment, but Carter said he did not have the “heart” to sentence the defendant to prison right after his wife’s death.
Prosecutors had recommended two years and three months in federal prison. Carter indicated he was considering 18 months to 27 months for Haglund of Irvine.
Huish showed Carter a 9-minute video of Haglund helping his disabled wife, who relies on a wheelchair and had trouble recalling the names of her children or her birthday.
Haglund, who was disbarred in July, did not initially realize what he was doing was illegal, Huish argued.
“But when the water was boiling he didn’t get out,” Huish said. “His mistake, his crime was he should have said no… He should have known better.”
Haglund, who pleaded guilty to aiding and abetting wire fraud April 28, 2016, testified against co-defendant Mark Gelazela, 44, of Marina Del Rey, who was convicted at trial in September, 2016, and was sentenced to 41 months in prison.
Gelazela persuaded victims to invest in scheme that purported to be spent on leasing and monetizing bank guarantees, according to prosecutors. Upon leasing the bank instruments, a credit line would be drawn that would be used for trading that would lead to big profits, prosecutors said.
Instead, Gelazela and the co-conspirators spent the money on themselves, prosecutors said. Some investors were paid off to keep the scheme going.
About 18 of Gelazela’s victims lost about $5 million in the scam, prosecutors said.
Woods and Haglund took in about $376,000 in the scheme, their attorneys said in court Monday.
The Haglunds have five children, but two live in Utah, another lives in Northern California and a son and daughter live nearby in Orange County. Carter said he intended to sentence Haglund to prison, but it was up in the air for how long and said the delay in sentencing could help the family decide what to do about Haglund’s wife if he has to go behind bars while she’s alive.
Also, the delay in sentencing gives Haglund more time to sell his house and the hope is to make sure the money goes toward restitution to the victims instead of the $6.7 million civil penalty he received from the securities Exchange Act ruling.
Huish said his client is already serving a sort of home confinement because he does nothing else but care for his ailing wife.
“Very simply, your honor, I acknowledge my mistakes,” Haglund said. “I am prepared to pay the price for these mistakes… My only hope is I can continue to serve my wife… But I am the one who has put my wife in these circumstances that she might have to go without my care.”
When Carter told Haglund, “I think you’re genuinely remorseful,” he replied, “I am, your honor,” prompting Carter to say, “I have no doubts about that.”
Haglund must return to court June 11 for possible sentencing that day.
Woods provided “exceptional cooperation,” his attorney, Marri Derby said.
Woods is a “very selfless person” who has quit jobs and moved to help relatives stricken with cancer and he helped nurse a stroke-ridden step- brother back to health, Derby said.
“I do accept responsibility,” Woods said. “I do. I would like to apologize to all the victims in this case.”
Another primary defendant in the case, Francis Wilde, 66, of Mountain View, California, who pleaded guilty in May 2016 to wire fraud was sentenced to 51 months in prison. Prosecutors said he was involved in 26 deals that cost victims more than $6.3 million.
–City News Service