UPDATE 1-Seven years prison for U.S. lawyer in Refco fraud
+ Fraud caused collapse of commodities broker
+ Judge says sentence to deter other lawyers
NEW YORK (Reuters) - A U.S. judge sentenced a former outside lawyer for Refco Finance Holdings LLC to seven years in prison on Thursday for his role in a $2.4 billion fraud that caused the collapse in 2005 of the commodities broker.
A Manhattan federal court jury found former Mayer Brown LLP lawyer, Joseph Collins, guilty in July of a broad conspiracy in a scheme in which both the former president and the former chief executive officer of Refco are serving prison terms.
In court on Thursday, U.S. prosecutor Chris Garcia told Judge Robert Patterson that before the estimated $65 billion swindle by financier Bernard Madoff was revealed in December 2008, former lawyer Collins "was a critical, critical player in one of the largest frauds this country has ever seen."
Collins, in a brief statement in court, thanked his family and friends for their support. His head bowed slightly when the judge pronounced the sentence.
"I don't believe he committed these crimes for greed, for money," said Patterson, who noted Collins' generous contributions to charity and work devoted to educating disadvantaged children. "I think this is a case of excessive loyalty to his client."
He said that the abuse of trust of a lawyer in large public transactions required a prison sentence to deter other lawyers from doing the same as Collins.
Collins was charged in a 14-count indictment in 2008 on charges of fraudulently trying to obtain hundreds of millions of dollars in revolving lines of credit. The jury found him guilty of conspiracy to commit securities fraud, wire fraud, bank fraud, money laundering and making false filings with the U.S. Securities and Exchange Commission.
Former Refco Chief Executive Officer Phillip Bennett is serving a 16-year prison sentence and former President Tone Grant is serving a 10-year prison term.
The case is USA v Collins, U.S. District Court for the Southern District of New York, No. 07-01170. (Reporting by Grant McCool, editing by Maureen Bavdek)
REUTERS
