RUTLAND — A Stowe man is heading to prison for two years despite his pleas for leniency after the judge told him it’s important in financial fraud cases that a message be sent to others considering that there will be consequences, including time behind bars.
Judge Geoffrey Crawford handed down the sentence to Daniel Burgess, 51, on Wednesday in federal court in Rutland on a charge of wire fraud.
In addition, the judge also ordered Burgess, who had earlier pleaded guilty to the offense, to serve a three-year term of supervised release and pay $248,900 in restitution to the woman he bilked.
Instead of paying back the money over the past seven years, according to prosecutors, Burgess “financed an expensive European wedding and honeymoon with his victim’s money.”
Burgess’ attorney had asked for a probationary sentence, or one with “limited” incarceration,” so his client could work to make that restitution.
The prosecutor argued for a prison term of a little more than two years, calling it “astonishing” that Burgess now wanted even more time to pay back the money that had been left unpaid for years.
In handing down the sentence, Crawford said in crimes driven by acts of impulse or fueled by drug addiction he questioned the deterrent effect of a prison sentence. However, he said, in financial crimes, where dishonesty or greed play a leading role, the situation is different.
“I think the deterrent effect is real,” the judge said.
That’s because, Crawford told Burgess, whether it’s some large business transaction or receiving change from a clerk at a convenience store, it’s important to have trust.
“We expect people to treat us honestly,” Crawford said.
For those “wavering” and “lacking a moral compass,” the judge added, when they see news reports of the penalties associated with financial “white collar” crimes it may prevent them from committing similar acts.
According to an indictment brought in late October 2016, Burgess was buying and selling securities through a company he owned named Tucker Financial Services.
Court documents say neither Burgess nor the company was registered with the Vermont Department of Financial Regulation.
Beginning in July 2011, court records stated, Burgess worked with a woman in Nevada to sell 520,000 shares of a stock she owned in a sports apparel manufacturing company.
The indictment stated that they agreed that Burgess would get 20 percent of the proceeds from sales of the stocks and the woman would receive the rest.
According to the indictment, Burgess successfully sold all of the woman’s shares between August and October 2011, netting a total of about $619,000 from their sale.
However, Burgess paid the woman less than half of the $495,000 that was owed to her under the terms of the agreement. He allegedly kept about $246,000 for his own use.
At the hearing Tuesday, Crawford asked Burgess if he had anything he wanted to say.
“Mr. Burgess, how do you see things?” the judge asked him.
Burgess, standing at the defense table, turned to face the woman in the courtroom he was charged with bilking.
“I’d like to apologize for not paying you in a timely fashion,” he said. “I take full responsibility.”
Moments later, the woman from Nevada who traveled to Rutland for the hearing Wednesday, addressed the judge, telling him she wasn’t buying that apology.
She delivered an emotional and strongly worded statement to Crawford on the impact the crime has had on her and her family.
“He isn’t sorry for what he did,” the woman said. “He’s sorry he messed with the wrong person.”
She blasted Burgess, calling him a “liar” and a “thief,” adding, “He is the most dishonest person I know.”
As a single mother raising five daughters, she said the hardship of not having the money that belonged to her was devastating. She couldn’t afford family vacations, she said, but yet viewed Burgess’ Facebook page that showed photos of him and his family on such getaways.
She talked how she battled Burgess in civil courts and eventually went to the FBI in search of justice in the case, leading to the federal prosecution.
“You thought I was the perfect target,” she then said to Burgess, adding that she would never give up her fight to recoup her losses.
The woman then told the judge, “I pray you see the destruction he has caused.”
Attorney Brice Simon, representing Burgess, said his client had “significant negative net worth” and has been trying to “liquidate” what assets he does have to pay back the woman.
He said the case wasn’t a typical matter of embezzlement. Instead, Simon said, his client had a lot of funds coming in and a lot of expenses going out.
“He thought he had enough money coming in to cover these obligations,” the attorney said, adding that Burgess “didn’t have the replacement income he hoped he would have.”
Simon also wrote in a sentencing memorandum filed with the court, “Burgess prays the Court will give him the opportunity to continue his work to liquidate those assets, which he cannot do from inside a Federal Penitentiary.”
Assistant U.S. Attorney Gregory Waples, who prosecuted the case, said Burgess had been given a great deal of time to repay the woman, but never did, even after the indictment was brought against him.
“I haven’t seen a good faith effort in seven years,” the prosecutor said.
Waples wrote in his sentencing memorandum that in the fall of 2011 Burgess and his wife got married in Europe and paid for “this extravaganza” with the victim’s money.
“In this period, according to the FBI’s analysis, Burgess spent more than $20,500 on airline tickets; $36,000 on other Europe trip expenses; nearly $8,000 on restaurants; $11,000 on hotels; and $5,200 for online shopping,” the prosecutor wrote.
“The fact that in the 18 months since his indictment Burgess has not paid even a penny of restitution is a telling but grim reminder of the direction in which Burgess’ moral compass is pointed.”
Burgess wasn’t immediately taken to jail following the hearing. Instead, the judge ordered him to the report to the federal Bureau of Prisons on July 24 to begin serving his sentence.
