Alberto Vilar andGary Tanaka, the technology investors convicted in 2008 of stealing from clients, must be resentenced, a federal appeals court in New York said.
A three-judge panel of the appeals court, applying a U.S. Supreme Court case limiting the reach of securities laws to domestic transactions, sent the case back to the trial judge to determine what part of the victims’ losses were tied to securities purchased in the U.S. The court yesterday also rejected arguments by Vilar and Tanaka, who were partners in New York-based Amerindo Investment Advisors Inc., that the convictions should be overturned.
Vilar, 71, an opera lover and former philanthropist, has about four years remaining on his nine-year sentence. Tanaka, 70, who owned thoroughbred race horses, was born in a U.S. internment camp for Japanese-American civilians during World War II. He has about two years to serve on a five-year term. In October, the two men were released from prison on bail pending the appeal.
U.S. District Judge Richard Sullivan, who presided over the trial, determined that the amount of loss caused by the scheme was $20 million to $50 million. Because federal sentences for white-collar crimes are often driven by the loss amount, Vilar and Tanaka may get lower prison terms if they can show part of it was tied to offshore transactions.
A jury in Manhattan convicted Vilar of all 12 criminal counts against him, including fraud and conspiracy. Tanaka was convicted of three counts and found not guilty of the remaining nine counts.
The appeals court declined to consider Vilar’s argument that the verdict against him should be thrown out because his lawyer provided ineffective assistance at trial. The court said Vilar may raise the claim in a petition for a writ of habeas corpus, a legal procedure used by people convicted of crimes to challenge the legality of their confinement.
The case is U.S. v. Vilar, 10-04639, U.S. Court of Appeals for the Second Circuit (Manhattan).
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