"The truth about me is I am a 45-year-old loser, and I am so very sorry… (Sandy Huffaker, Bloomberg…)
As Barry Minkow prepared to be sentenced a second time for securities fraud, he appeared in a familiar role: repentant, apologetic, acknowledging deep character flaws and expressing hope he can transform himself for the better yet again.
"The truth about me is I am a 45-year-old loser, and I am so very sorry for what I have done," Minkow wrote in a letter to U.S. District Judge Patricia A. Seitz of Miami, who was to sentence him early Thursday for conspiring to manipulate the stock of home builder Lennar Corp.
Minkow said he let down the congregation at San Diego's Community Bible Church, where he reinvented himself as head pastor after spending more than seven years in prison for the ZZZZ Best investment scam in the 1980s. Church members he served for 14 years "never saw my criminal activity coming," he said.
The sentencing marks the latest twist in the life of a man who was once hailed as a whiz-kid entrepreneur on "The Oprah Winfrey Show" while a teenager growing up in Reseda. Even after getting out of prison, Minkow parlayed his reputation as a Ponzi schemer to build a new life as a fraud-detection specialist and government informer.
This time around, facing up to five years in prison, Minkow might not be so lucky.
He has spent weeks before Thursday's court date in a final campaign for leniency. In filings with the court, Minkow, now living in Tennessee, asked to be spared because his two adopted sons have learning disabilities and need his help.
He describes himself as a recovering Oxycontin addict with serious health conditions that require "a litany of prescribed medications" that "will tax the medical services of the Bureau of Prisons."
Minkow said he suffers attention deficit hyperactivity disorder and migraine headaches so severe that he must take several medicines, including one unavailable in federal prisons. Abusing steroids as a teenage weight lifter rendered him unable to produce sperm or testosterone, and he is in need of constant treatments to limit his body's production of the female hormone estrogen.
He also filed testimonials to his years of work exposing investment schemes and corporate wrongdoing, and to the fraud-detection seminars he conducted for the FBI and other organizations.
There was also remorse for betraying prison inmates on whose behalf Minkow intervened over the years by asking federal judges "to believe that people can change and inferring my own life as a case study," he said.
Answering recent allegations that he had misused church funds to finance his Fraud Discovery Institute, he filed hundreds of pages of photocopied checks to show that he had given the church far more than he took. He included the minutes of a Sept. 27, 2010, meeting of church elders that contains the entry, "It is clear that Pastor Barry's giving exceeded what was reimbursed to him.... Issue is closed."
Prosecutors from the U.S. attorney's office in Miami urged Seitz to give Minkow the maximum five-year sentence on the single conspiracy count to which he pleaded guilty. Minkow admitted in March that he conspired to drive down Florida-based Lennar's stock price on behalf of Nicolas Marsch III, a La Jolla developer whose partnership with the builder had soured.
Minkow admitted making illegal bets that the shares would decline, and wanted Lennar to cough up cash and stock in return for a retraction of numerous accusations he had made against the company and its top executives. He is being ordered to repay Lennar $583 million, the amount the stock declined amid Minkow's attack on the company.
Minkow said he is now grateful that Lennar fought back, exposing what he characterized as his reckless disregard for the truth: "For whatever reason, that has allowed me a foundation to rebuild upon as I can never learn from [the] past if I had continued in self deception."
Minkow's attorney, Alvin Entin, said his client has cooperated with federal prosecutors and handed over thousands of documents related to the Lennar case. He hopes the prosecution will someday ask the judge to reduce Minkow's sentence because of his cooperation with the investigation.
Laurie L. Levenson, a Loyola Law School professor who had been a prosecutor for the U.S. attorney's office in L.A. at the time others in the office prosecuted Minkow, said it was highly unlikely such a "repeat offender" would be given less than the maximum sentence.
"He's extraordinarily manipulative and opportunistic," Levenson said. "It's always what's best for Barry. He always plays both sides of the fence."
That's what Marsch maintained since he initially hired Minkow to look into whistleblower allegations of corruption inside Lennar. He, and his lawyers, said they never authorized Minkow to launch attacks on the home builder. Marsch was also under scrutiny by prosecutors; in Minkow's plea agreement he is referred to as "Conspirator A" for his role as the alleged motivator of the scheme.
"It is becoming clear that there were two Barry Minkows," Marsch said in an email to The Times.
"The good Barry," he said, "was able to convince an amazing cross section of people and organizations: FBI, SEC, IRS, national journalists, parishioners, clients, business partners, and investors that he had straightened out his life and had become a productive member of society. I am in that group.
"The bad Barry is in fact a sociopath who apparently thinks nothing of making up a story to reduce his sentence, misappropriating church funds, misusing agency relationships, and the like."