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FINANCIAL SERVICES | BRIEFLY

Financier Sentenced to 20 Years

March 08, 1997|Times Staff and Wire Reports

A federal judge in New York sentenced Steven Hoffenberg, accused of masterminding the biggest financial swindle in U.S. history, to 20 years in prison, saying the financier wreaked havoc on thousands of people. U.S. District Judge Robert Sweet also ordered Hoffenberg, 52, the former head of scandal-ridden Towers Financial Corp., to pay $462,556,436 in restitution and a fine of $1 million. Hoffenberg had run Towers, the bill-collection business that filed for bankruptcy protection from creditors in 1993, until it was discovered that the flamboyant financier was using the company to operate what prosecutors called the largest Ponzi scheme ever in the U.S. The judge said that while Hoffenberg is now indigent, it may be possible for him to come up with some of the restitution payments. Hoffenberg, who gained attention when he offered to rescue the New York Post in January 1993, pleaded guilty to conspiracy and fraud charges in April 1995.

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