Colonial Executive Gets Nine-year Prison Sentence
WATERBURY, Conn. (AP) _ Benjamin Sisti, a founder of the failed Colonial Realty Co., was sentenced Friday to nine years in prison, the stiffest sentence to date in the biggest real estate scandal in Connecticut history.
Sisti was sentenced one day after his former partner, Jonathan Googel, received an eight-year sentence.
Federal prosecutors said both men committed fraud by hiding information about the West Hartford-based company’s failing finances from investors and continuing to sell shares in limited partnerships even after bankruptcy experts told them the company was doomed in April 1990.
Colonial’s $2 billion real estate empire was forced into bankruptcy five months later, costing nearly 7,000 investors as much as $350 million, the estimated value of 63 limited partnerships.
Authorities could not say how much of the loss could be attributed directly to the fraud.
Sisti, 56, pleaded guilty in 1993 to two counts of bankruptcy fraud, one count of wire fraud and one count of violating currency laws.
He apologized for his actions and said, ``The last five years of my life have been a living hell.″
As he did in the Googel case, U.S. District Judge T.F. Gilroy Daly went above sentencing guidelines, which set the punishment for the crimes at 2 1/2 to 4 1/4 years.
Daly credited Sisti for cooperating with prosecutors since reaching his plea agreement two years ago. But he said the fraud committed by both men had caused financial devastation to thousands of investors.
Daly chastised Sisti for transferring millions of dollars to his wife’s bank account and buying property in Florida to hide assets from creditors at a time when he knew Colonial was on the verge of collapse. Much of the money was eventually moved back to Connecticut.
Most of the money was recovered as part of a settlement reached last year with the bankruptcy trustee. The settlement required that most of the assets of Googel and Sisti be turned over to the court for distribution to creditors.
Sisti’s son, Kevin, 30, who was placed Wednesday on three years’ probation for his conviction on a conspiracy charge, watched as his father was sentenced. Kevin Sisti conspired to launder money in an attempt to help hide his father’s assets from creditors.
Seventeen people have been convicted of criminal charges stemming from the collapse of Colonial. Frank Shuch, another Colonial founder, committed suicide in 1992 while awaiting trial on a 40-count fraud indictment.