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Boesky Begins His Life as a Prisoner in Lompoc, Calif.

March 24, 1988|MICHAEL A. HILTZIK | Times Staff Writer

NEW YORK — Stock speculator and insider trader Ivan F. Boesky on Wednesday entered the federal penitentiary in Lompoc, Calif., to begin serving his three-year term for breaking federal securities laws.

Jim Finley, acting assistant camp superintendent at Lompoc, which is about 150 miles north of Los Angeles, was quoted by United Press International as saying that Boesky "signed in at about 4:10 p.m. Right now, he's in the waiting room. But soon he'll be assigned a bed and a place to sleep."

Angi Willis of the U.S. Bureau of Prisons' inmate locater office, said that Boesky has been in the custody of federal marshals since Jan. 20, or about a month after he was sentenced by U.S. District Judge Morris E. Lasker for his role at the center of the largest insider-trading ring ever exposed by federal regulators.

Not Unusual

She said it is not unusual for a convicted felon to remain in custody for so long before his term formally begins. "His is a highly publicized case," she said.

Boesky in 1986 paid $100 million in fines and penalties to settle Securities and Exchange Commission charges that he had engaged in widespread insider trading in stocks of companies involved in pending takeover deals. Last year, fulfilling the terms of a plea bargain that he struck with federal prosecutors, he pleaded guilty to a single count of conspiring to make false statements to the SEC.

He received the three-year sentence on that charge last Dec. 18 and was given 90 days to report to prison. On Boesky's request, Lasker recommended that the term be served at Lompoc, where few of the 700 inmates are serving time for Wall Street crimes. Lompoc is equipped with a single tennis court, cable television and eight telephones for inmates, as well as a dairy farm, slaughterhouse and furniture factory to occupy the prisoners.

Cooperative Felon

Under the rules governing his sentence, Boesky will be eligible for parole after one year and is likely to be released, assuming good behavior, after two years.

For more than a year, Boesky has been cooperating with regulators and prosecutors investigating securities manipulation and insider trading.

He implicated several former associates, occasionally by recording his conversations with them, and provided what prosecutors told Judge Lasker was "unprecedented" testimony about wrongdoing by himself and others.

Still, there are signs that the federal investigation may have become bogged down in the difficulty of obtaining corroborating evidence for Boesky's own testimony. Although Boesky is likely to be a witness at the trial of anyone he implicates, defense attorneys say his credibility can easily be challenged in court.

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