Corp sole promoters get 20 and 15 years in prison

[Demosthenes]

It's Tax Protest promoter and Jim Norman, all in one scam.

Pair get maximum sentences for swindling 1,300 victims
By MICHELLE WASHINGTON, The Virginian-Pilot
© July 13, 2007 | Last updated 10:27 PM Jul. 13

Two people convicted in a pyramid scheme that fleeced more than 1,300 people out of more than $31 million will each serve the maximum sentence for their crimes, a federal judge ruled Friday.

Howard Welsh, 63, was sentenced to 20 years for wire and mail fraud and conspiracy. His girlfriend, 53-year-old Lee Hope Thrasher, was sentenced to 15 years for similar crimes. U.S. District Judge Rebecca Beach Smith also ordered them to repay the money after their release.

Prosecutors said Welsh and Thrasher traveled the country promoting an investment scheme that promised returns of 10 percent to 100 percent using financial plans called "corporation soles," a type of tax-free investment usually reserved for churches. The pair required a $1,500 fee to enter the program. In about four years, Welsh and Thrasher took in $43 million and made about $6.5 million in payments to investors.

They eventually wired about $31 million to foreign banks and fled the country. They were arrested in November 2004 in England, where they were living under assumed names. They fought extradition, and it took almost two years to return them to the United States. They pleaded guilty to the charges in October.

In an effort to reduce the sentences, defense lawyers argued during Friday's hearing about the numbers of victims and dollars stolen and whether Welsh and Thrasher had accepted responsibility for the crimes.

Smith said the arguments diminished Welsh and Thrasher's claims of remorse. Additionally, she said, both Welsh and Thrasher had written letters to her in the past few days, in which each sought to minimize the other's role, and claimed altruistic reasons for collecting the money.

Thrasher's lawyer, Lawrence Hunter Woodward Jr., said his client wrote the letter without his knowledge. In it, she professed her continuing love for Welsh.

"She wrote about the nobleness of his heart," Woodward said. "I hate to be flip about it, but I've told her I thought she's drinking the Kool-Aid."

Smith reacted with incredulity to Welsh's claims that the money is in a bag in a government warehouse in a Ghana, an African nation. Welsh asked to be released to personally negotiate the return of the money.

Smith called the story "close to preposterous."

Welsh said nothing before he was sentenced. Thrasher, who formerly worked as director of the victim-witness program in the Virginia Beach commonwealth attorney's office, apologized.

"If I had the capability to bring the money back, I would do so," she told Smith.

Cindy Schott attended the hearing to support Thrasher. Schott wrote an e-mail later Friday praising Thrasher for helping to raise her children and encouraging her to go to college.

"The woman they spoke of in court today is not the woman I have known for 27 years," she wrote.

Few victims attended the hearing. Assistant U.S. Attorney Robert Seidel Jr. said many live on the West Coast, and a number were too traumatized to attend.

One who did watch the proceedings was Ken Watson of Virginia Beach. He said he invested $30,000 with Welsh and Thrasher, and got nothing back.

Friday was his birthday. Watching Welsh and Thrasher' s sentencing, he said, "was the greatest present I could have received."

[The Observer]

Thrasher's lawyer, Lawrence Hunter Woodward Jr., said his client wrote the letter without his knowledge. In it, she professed her continuing love for Welsh.

"She wrote about the nobleness of his heart," Woodward said. "I hate to be flip about it, but I've told her I thought she's drinking the Kool-Aid."

It's pretty bad when your own attorney starts relying on "Quotes from Quatloos" to describe your behavior.

Smith reacted with incredulity to Welsh's claims that the money is in a bag in a government warehouse in a Ghana, an African nation. Welsh asked to be released to personally negotiate the return of the money.

No doubt the money was in the hands of the widow of some late African president/general.