Durham found guilty on all counts

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A federal jury has found financier Tim Durham guilty on all 12 felony counts stemming from what prosecutors charged was a massive Ponzi scheme that cost investors in Ohio-based Fair Finance more than $200 million.

The jury found Jim Cochran, who co-owned Fair, guilty on eight of 12 felony counts and Rick Snow, the firm's chief financial officer, guilty on five of 12 counts.

Judge Jane Magnus-Stinson ordered all three held at the Marion County Jail until a hearing Monday morning, when she will determine whether they should remain detained or be released on home detention until sentencing.

Durham, 49, Cochran, 56, and Snow, 48, were handcuffed and led out of the courtroom by U.S. Marshals, who transported them to jail. The defendants did not exhibit an obvious reaction, though a few family members who had gathered in the courtroom wept.

The defendants each faced the same 12 counts: 10 counts of wire fraud, one count of securities fraud, and one count of conspiracy to commit wire fraud and securities fraud.

After deliberating for about eight hours, the jury found Durham guilty on all counts, while splitting its decision on Cochran and Snow. The pair were found not guilty on three charges involving wire transfers of funds from Fair that wound up in Durham's bank account.

For wire fraud charges involving recorded phone calls, the jury found the two defendants on each particular call guilty. Durham was a participant on every call that resulted in charges.

The jury found all three defendants guilty of securities fraud, conspiracy to commit wire and securities fraud and two counts of wire fraud involving the dissemination of an offering circular for investors in Fair Finance.

Assistant U.S. Attorney Winfield Ong urged the defendants be taken into custody, telling the judge they are flight risks. The defense attorneys argued their clients should be released back to home detention pending sentencing.

"Tens of millions of dollars are missing," Ong told the judge. "All of them are facing life sentences. All it takes is $2,000 to get across the border."

The judge said she would make the decision after hearing evidence on the question at 10 a.m. Monday.

U.S. Attorney Joseph Hogsett hailed the jury's decision, calling the case "the most significant piece of litigation the Southern District has seen in a generation." (See video below for more Hogsett comments, then story continues.)

The verdict was a huge victory for Hogsett's office and the FBI, which began investigating Durham more than three years ago.

Hogsett vowed to seek the "full and maximum penalties." He said that makes it "entirely likely (the defendants) will serve the rest of their lives in jail."

Each wire fraud charge can carry a prison sentence of up to 20 years; the punishment on the securities fraud charge would take into account the number of investors who lost money and how much they lost.

Sentencing will occur in the next few months. At that hearing, defendants would have the opportunity to call character witnesses.

Durham defense attorney John Tompkins declined to comment as he left the courtroom Wednesday.

David Spector, an Ohio businessman who lost about $200,000 in Fair and testified for the prosecution, expressed gratitude when reached by phone Wednesday evening.

"I think the jury heard all the evidence, and it's pretty clear from the short deliberation and the verdict that the evidence was overwhelming," said Spector, who lives in Wooster, Ohio. "It sounds to me like the system worked."

Brady Cassidy, a 68-year-old Wooster resident who lost $90,000, added: "It doesn't put a dime in our pocket. But justice is served, and that's great. I'll have a good evening."

The judge read the verdicts starting at about 6:25 p.m. Wednesday.

Attorneys for the prosecution and defense offered their closing arguments Tuesday afternoon, a few hours after defense attorneys for the three defendants rested their cases. The jury began its deliberations at 9:50 a.m. Wednesday. The trial began June 11 in U.S. District Court after jury selection on June 8.

The U.S. Attorney's Office offered six days of testimony, thousands of pages of documents and recordings from FBI wiretaps as it tried to convince jurors the defendants ran Ohio-based Fair Finance as a Ponzi scheme, defrauding more than 5,000 investors.

Prosecutors said the defendants gutted Fair by doling out tens of millions of dollars in related-party loans to Durham, Cochran, their friends and their failing businesses. Those loans were never repaid.

Defense attorneys blamed the 2009 collapse of the consumer-loan company on a "perfect storm" of a bad economy, bad press and newly skeptical Ohio regulators. Defense presentations lasted less than two hours and did not include testimony from Durham or his co-defendants.

To catch up on IBJ's coverage of Fair Finance and Tim Durham, click here.


  • PS
    I didn't know Lake Maxinhull was ripe for swimming, I always think of my friends who live there and how they tool around on their pontoon boats. ....................................................................................... PS--that moustache and 70s haircut is almost in the ballpark of being as obscene as your obsession with me...........................................................................................................
  • Re: Friend
    There was a very funny thing at Durham's trial. An IBJ journalist, who rarely published a Durham article without the tagline that the FBI raid occured one month after his investigative story, sat scribbling in the back instead of testifying in the front and I do not recall Sue's presence there at all. Neither were called to witness for the prosecution or share their evidence with the judge and jury. The prosecution had plenty of time for such testimony, a full 2 weeks alloted them went unused. Even the fellow charging Durham killed his long suffering 80 + year old mother made the lineup, and agree with it or not, that testimony had zero to do with the validity of the actual charges. If the efforts of either were so vital to the case, why were they not called to take the stand? IBJ: I am not being abusive or making a false claim. I used a name but if that is grounds to remove this post, then to be fair, all other post using names should also be removed.
    • Credit Where Due
      Even though the whistleblower doesn't care who gets credit for exposing Tim's crimes, without her information, determination, and tenacity, Tim would likely still be ripping people off rather than sitting behind bars. The Bible says that if you dig a pit for someone else, you'll fall in it yourself, which is what happened when Timmy and his friends, such as Carl Brizzi, tried to go after the whistleblower in an obvious attempt to intimidate and silence her. Isn't it a crime to use a position of authority (prosecutor) to make false allegations against someone in an attempt to cause them harm? I'm sure Tim and his friends weren't expecting the bommerang to come right back at them. As far as positive comments about Tim, that's a joke. If there are positive comments, they're coming from friends and family of Tim's, because everyone else in the country is disgusted by the theft, greed, and arrogance of the convicted criminals. I hope Tim finds Jesus in prison, because hell is much worse than a lifetime behind prison.
      • Moderator
        Dear Moderator, Your message was sent to me today at 9:55 am. It is now 4:15 pm. I do apologize for the inexcusable delay but I was away from the computer swimming with family until just now. Were there other attempts from you that I missed? Rest assured you addressed the correct person. There have been no deceptions on my part. I will reply to your message from my e-mail address later today. You really are not give yourselves enough credit with the monitoring. I have not found it to be in the least neglected, but rather exceptionally swift and skillful. Warmly, Harvey
        • Reasons for removal
          Harvey, We tried to contact you through the email address you've been leaving on your posts, but we've had no success in reaching you. Our preference is not to remove comments to stories, but we simply don't have time to monitor all of the personal attacks, anonymous allegations, deceptive names and links to inappropriate material that seem to be common on postings to Tim Durham-related stories. IBJ provides this forum for civil discourse. We reserve the right to discontinue postings on stories when we feel it's necessary. Thank you for reading.
          • Having site difficulites IBJ?
            What, no other commentors today and no curiousity why the most recent IBJ article has no comments but this old one has? They pulled their latest article's entire message board late last night because, overall, it was in support of Durham. They did the exact same thing the day before to their article about Durham's lawyer appealing the guilty verdict. There was too much support for Durham on that one too. They had been pulling reasonable non-offensive individual comments all along that were in Durham's defense but to pull entire boards? I inquired this morning into the missing boards and with minutes 3 more boards vanished. The editor likely stepped in on the foolishness of the monitors and tried to quickly balance the boards. Why does this matter? It is proof of how the local media has been manipulating public opinion against Durham and might help Thompkins prove why a fair and unbiased trial was unlikely here. The Indiana Business Journal has been the worst offender giving Durham his very own IBJ news tab for years. (Screen shot.)
            • Too late editors...
              ...you should have picked brighter board monitors. That was priceless actually watching entire message boards disappear. Are we up to 5 now? No matter, I have screen shots of how you HAVE been manipulating public opinion.
            • Vanished IBJ Boards?
              There were comments under your latest story and that of Durham's attorney appealing verdicts. Why did you take them ALL down? Maybe have been a violation to your attempt at controling public opinion?
              • Not Scotty..
                Evidently your dear friends at the IBJ are not sharing with you who is posting(trying to post)responses to you. No, this is not Scotty or Sheri. As a nod to their (the IBJ)keeping my reply to you below, might I recommend, as you insist on proclaiming your close association with them, that you at least edit your tiresome garble down a bit? Those at the IBJ must wince at the level to which such a sidekick thinks and writes.
              • Hiya
                Sorry to say Greg Andrews is actually the guy who put it together--the whistleblower gave him all the early stuff and once he started running stories he got tipped off on the investment certificates--and then the whistleblower learned there was $1.65 Billion of worthless investment certificate offerings--not $200M-- at the same time Greg figured out how Durham and friends put the whole schme together and exactly how much they had skimmed out. Whistleblower about had a coronary when she learned Durham was selling all this crap in her parents hometown and had gotten her own family --Then, a super cool dude named Erich--who was the one who originally figured out Tim owned Fair Finance and told whistleblower when she originally called him about the Cellstar money being directed to Fair--threw some things in and built a great website--and so did lots of other people that suddenly came out of the woodwork. But none is comparable to what Greg was able to put together. Greg is the smart cookie here--too bad to say none of us read that bogus book where a certain author bragged of Fair as one of the many profitable holdings Tim had that made them all wealthy or this sick scheme would have been stopped years ago. And, Greg ain't done yet, he and Cory outted that Elkhart crap and the John Bales crap and all the walls of Indy's self-annointed elite started tumbling down, as Mellencamp would say...I think the feds would call Tim the "King of the Dorks"--that's what Seth called him...
                • Re: Meryl Streep a.k.a Whistleblower
                  Bravo Whistleblower! Fine performance you gave. It's hightime someone of your fine pedigree and brilliant mental prowess take credit for bringing this all about.
                  • Re: Whisleblower
                    Cheers for all the digging! Here's to that future excavations related to your life be on your own behalf!
                  • Tim's booking info
                  • Durham Bought Politicians for Protection
                    There is much more to this story. It is abundantly clear that Tim Durham used monies fraudulently and illegally extracted from Fair Finance duped investors to buy as many politicians as he could. Why? For protection and to have an elevated place above the law. Just look at Tim's good buddy and former Marion County prosecutor, Carl Brizzi, and how he bought him. Money equals power and Durham played that to its fullest. This is a saga about the system being corrupt to its very core.
                  • Marion County jail pics/video
                    Tim's temporary home: http://www.fox59.com/news/crime/wxin-marion-county-jail-on-lockdown-following-attempted-escapes-20120111,0,6095314.column
                  • He'll be fine
                    The kids grandfather is Burt Sevass. I think he wil be just fine.
                  • Better Off Without a Father Figure Like Tim
                    I'm sorry for the victims of Tim and his partners in crimes' collateral damage, but I see no benefit in a "father figure" whose deliberate actions have ruined so many. Guess the kids will have to learn the hard way and hopefully someone will step into their lives that will be a better example of what a man should be.
                    • Response to Joe T
                      You wrote, "because of the court, his son will now have to go through this." Reality check, Joe T!! Because of Tim Durham, his son will now have to go through this! I wonder if you are one of Tim Durham's "friends" who ran around with him and enjoyed loads of fun and outrageous extravagances on other peoples' money!!!!!
                    • Question
                      Can someone please clarify how a penniless Red Rock loaned millions to Lampoon when I thought Tim directed millions from Fair to Lampoon. Thanks. And how did Carl Brizzi get mixed up in all this? Thought he was broke back then. http://www.indystar.com/article/20091212/BUSINESS/912120373/More-troubling-ties-for-Brizzi
                    • Let them roast
                      It has taken too long to come to this. I hope the families and victims get some sort of relief. These men are not good members of society -nor good role models for children. I look forward to the sentencing in a few months. Perhaps Carl and the some others will come up on charges!
                    • Re
                      Not trolling at all, but if you think we were not documenting the theft of millions of dollars and the probable recipients, think again. No apologies here--but it's pretty easy to guess who you are. ...... So, let me say this--Sociopaths and Narcissists thrive on attention. There won't be more postings about Tim on here because being incarcerated for years and years starting tonight he won't be in a position to read them anymore and in a few days this story will die down, it will have a short bounce back up during the sentencing phase and perhaps again when Greg and Cory win well-deserved journalism and publishing awards for their "yellow journalism" that 5,600 Ohio victims praise the Lord for. After all, if not for them Tim would be laughing and mocking the future victims of Millersburg, Ohio--that place filled with those "stupid Amish" that are like "taking candy from a baby." ............. Alas....Timmy has a few "friends" (who are where tonight?) left who also participated in crimes and all of you know who you are, so let me just say a narcissist cannot not have attention. They live to be the center of attention--even in prison. Look at Scott Rothstein sing away. ..... What this means is Tim will blab in prison. Bad news for his dishonest friends...bones in the graveyard are always hunted eventually.... Just watch. Enjoy your sleep tonight, if you can get some....look at the stock charts....which stock has been hovering below $5 bucks a share....gee I wonder why....no pump this time, huh.....let's see who gets busted next as you guys react to the victims--none of you have any shame. And when you get busted will that be our faults? NO ONE MADE YOU TAKE MONEY. NO ONE MADE YOU LIE TO YOUR MORTGAGE COMPANIES THAT YOUR FUNDS WERE PERSONAL FUNDS WHEN IN FACT THEY WERE FAIR FINANCE MONIES. NONE OF US MADE YOU FILE FALSE TAX RETURNS.... NONE of us made you sign 13d statements that your stock purchases were made with personal funds............................................. I am glad I did not take a penny from Tim Durham. No one I know took a penny from Tim Durham, it was the other way around and now he is locked away. How did you think he would never get caught? OMG. The truth always comes out. That's what is so great about the good ol US of A, journalists provide the needed checks and balances when so many others won't. Be well. Enjoy middle classhood--it's really not so bad.
                    • Is this IBJ?
                      We just read your post that said, "No one should be stalked and harassed...", yet, you are trolling the Facebook page of Tim's kid? The trial is over and justice has been served. I thought you were going to get a life! IBJ? Are you really going to leave that comment? I don't understand why on earth you allow this type of garbage on a news site that is supposed to be reputable.
                      • REALLY?
                        Who REALLY cares about Timmy's son? He'll be fine. Mommy and Grand Dad Versaas will take good care of him. Have fun rotting in JAIL Tim, you deserve it!!
                      • x
                        Maybe Tim Sr should have thought about how his actions could affect his son. Although one can feel sorry for Jr, it is not the court's fault.
                        • Great News
                          I am more than pleased to hear that all 3 have been found guilty. All of them deserve to spend the rest of their lives in prison. I feel sorry for Durham's son but it was his father's actions, not the court, that caused this situation. The repeated criminal acts conducted by these 3 low-lifes give honest, hardworking business people a bad name, help to destroy confidence in the business sector and ultimately destroy the financial conditions of those who were victimized. I would urge the judge to sentence all 3 to the maximum. No way should they be released before sentencing.
                        • squatters
                          Now how about going over to his mansion and kicking out his friends that are living in the place bought with money stolen from others?
                        • Mitch
                          I know it sounds like old news. However Tim contributed 1,000's to Governor Mitch Daniels. Now Mitch has secured a position at Purdue instead of putting himself in the presidential race. He was the republican's darling of sorts. Is he paying this back? http://www.followthemoney.org/database/StateGlance/contributor_details.phtml?d=760539285
                        • GOOD LUCK TO TIM JR.
                          Being the guys son is one thing but being Tim Durham, Jr. Will be painful for sometime, finding a job, school, etc and just being accepted. He should get an attorney and change his name to TIM SERVAAS.
                        • So go easy on him?
                          Yes, there are many victims here, his family among them, but how can you say that "because of the court" his son will suffer? Durham and the others made bad decisions and brought this on thier own heads. They were surely aware of the potential consequences - the legal and ethical "wrongness" of what they were doing. Unfortunately, they chose rampant greed over the well-being of their families as well as the investors. Their sentences should not be mitigated to lighten the burden on their families. If he was my own father, I would be ashamed and deeply disappointed in him.
                        • Something smelled fishy...
                          The only money related to this mess I am out is from paying for a tour that included Tim's "office." He was not there, but the place was like a museum with several very expensive model-sized "toys". Then, I was present during a second Tim Tour, this time at the garage were his many (and I mean MANY) classic automobiles were stored. Gives a new meaning to "how the other side lives." Maybe exchange "other" with "corrupt".
                        • Curious
                          It is an awful shame about Tim's son. But I'm curious, should Mr. Durham have been set free so his son doesn't have to suffer? Should every criminal with an innocent child be set free because so that person's child doesn't have to suffer? Is a person like Mr. Durham a good role model for a son? Just might be that the child is better off without a father like that. Bottom line is, Tim should have thought about his son before he did what he did. HE hurt his son, not the judge. He has to suffer the consequences.
                        • Hallelujah
                          Thank you to the jury that saw through the self-serving lies and and greed that ruined so many lives. I only hope now that they each receive the maximum sentence.
                        • The other victims
                          You are forgetting about the other lives that are ruined though because of this conviction. Durham's son now basically has no father....and I'm sure this will take an emotional toll on the son. I mean...who will be the father figure in his life, and help him with tuition and things like that. Durham clearly made some bad choices, but because o the court, his son will now have to go through this.
                          • To Tim's friends and family
                            Who would have thought this would ocme full circle to my Mennonite step-mother and her family--you picked the wrong girl to stalk and harass year after year which caused me to dig. And, Greg Andrews did the rest along with Cory Schouten, who will forever be my heros. Thank you, Greg and Cory--for believing and reading the documents and daring to dig and running the stories so you got the tips from inside Fair. Thank you to Jeff S who put a stop to the public antics and slander that Carl emitted because he's mad his friends got busted and the good times for him came to an end. And, thank you to God for putting Tim Durham away so I, and his other victims, can once again have a life. No one should be stalked and harassed and stolen from year after year and this verdict ensures Tim will never again be able to use the financial and or legal system to ruin someones life. And, on a side note I have never met Tim Durham despite the fact I am referred to as his ex girlfriend. Never met him, never been in a room with him, nothing. All I did was turn him in after I was asked to "get in on" a crime he was committing. He then decided to pay me back, because he was paranoid he would be investigated. Never could I have dreamed it would come full circle to my family, and that he was stealing their life savings and that of their friends. It's been surreal, that's for sure, but we will all survive and he will be locked away. THANK YOU GOD.

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                          1. You are correct that Obamacare requires health insurance policies to include richer benefits and protects patients who get sick. That's what I was getting at when I wrote above, "That’s because Obamacare required insurers to take all customers, regardless of their health status, and also established a floor on how skimpy the benefits paid for by health plans could be." I think it's vital to know exactly how much the essential health benefits are costing over previous policies. Unless we know the cost of the law, we can't do a cost-benefit analysis. Taxes were raised in order to offset a 31% rise in health insurance premiums, an increase that paid for richer benefits. Are those richer benefits worth that much or not? That's the question we need to answer. This study at least gets us started on doing so.

                          2. *5 employees per floor. Either way its ridiculous.

                          3. Jim, thanks for always ready my stuff and providing thoughtful comments. I am sure that someone more familiar with research design and methods could take issue with Kowalski's study. I thought it was of considerable value, however, because so far we have been crediting Obamacare for all the gains in coverage and all price increases, neither of which is entirely fair. This is at least a rigorous attempt to sort things out. Maybe a quixotic attempt, but it's one of the first ones I've seen try to do it in a sophisticated way.

                          4. In addition to rewriting history, the paper (or at least your summary of it) ignores that Obamacare policies now must provide "essential health benefits". Maybe Mr Wall has always been insured in a group plan but even group plans had holes you could drive a truck through, like the Colts defensive line last night. Individual plans were even worse. So, when you come up with a study that factors that in, let me know, otherwise the numbers are garbage.

                          5. You guys are absolutely right: Cummins should build a massive 80-story high rise, and give each employee 5 floors. Or, I suppose they could always rent out the top floors if they wanted, since downtown office space is bursting at the seams (http://www.ibj.com/article?articleId=49481).