The man who defauded Rep. Alan Grayson (D-FL) out of $18 million as part of a stock-related scheme was sentenced on Monday to 12 years in prison, the Associated Press reported on Monday.
Grayson confirmed to the AP that he was identified as "A.G." in most of the documents surrounding the case of William Dean Chapman, who was found to have swindled 120 other victims, along with Grayson, for more than $35 million, adding that lawyers for both the prosecution and the defense violated court procedure by using his name in separate motions.
"I think that's unfortunate," Grayson told the AP. "They should have been more careful, should have used my initials throughout rather than using my name."
According to the AP, Chapman's scheme would begin when his company, Alexander Capital Markets (ACM), acquired stocks from victims to use as loan collateral. The company then issued loans for about 90 percent of the stock's worth to the clent.
Under their agreement with Chapman, the clients could keep the money if the stock underperformed. But if it performed well enough, the client would receive the stock back at the higher value if they repaid their loans to Chapman with interest.
However, court documents stated that Grayson's investments performed well enough to undermine the plan; one portfolio worth $9.35 he reportedly entrusted to Chapman's company increased in value by 147 percent, to $23 million. Chapman also reportedly sold the stocks entrusted to him, leaving him without a way to repay the clients in such cases.
"If they had not sold the collateral, it all would have worked," Grayson told the AP.
The Florida lawmaker began using Chapman's services in 2007, two years before he began serving in Congress and before winning $34 million as part of a racketeering suit against a South Carolina company, Derivium Capital, which was found to be conducting a similar kind of fraud as Chapman.
The AP reported that Grayson's personal assets are worth an estimated $20 million, making him one of the country's 50 richest lawmakers.
[h/t Talking Points Memo]
[Image via Current TV]