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Ferguson’s friends plead for leniency

Michael Schwartz February 11, 2013 18

The legal defense team of former Richmond investment banker Allen Mead Ferguson is armed with some extra leverage after almost 50 of his friends submitted letters on Ferguson’s behalf, extolling his character and generosity leading up to his sentencing Friday for fraud.

The letters – written by a who’s who of the local business community – implore his attorneys to push the judge to consider Ferguson’s philanthropy, age, health and supposed public humiliation as reasons for leniency at his sentencing hearing before U.S. District Court Judge Henry Hudson.

For example, Al Broaddus, former president of the Federal Reserve Bank of Richmond who was a fellow alum of Washington and Lee and a fraternity brother with Ferguson, wrote: “Allen has been exceptionally generous to a number of leading community institutions – financially, to be sure, but with his time and effort as well. His support of the local Boy Scouts chapter and St. Christopher’s School are especially legendary.”

Even a Richmond bank still owed money from Ferguson submitted a letter encouraging a sentence of home incarceration rather than jail time.

Allen Mead Ferguson

Allen Mead Ferguson

Ferguson, 75, pled guilty in November in what federal prosecutors said was a scheme that spanned four years and resulted in him obtaining $5.6 million in loans from several banks while lying about his wealth as collateral.

Once the head of old-time Richmond investment banking firm Craigie, Ferguson admitted during personal bankruptcy hearings in 2011 to lying about the existence of investment assets to secure more loans.

Bankruptcy liquidation of many of his and his wife’s assets, including their homes and artwork, has helped recoup about $3 million.

Prosecutors from the U.S. attorney’s office are asking for 36 months in federal prison for Ferguson. That’s below the five-to-seven-year range called for in federal guidelines for such crimes. The U.S. attorney’s office asked for a lesser sentence because Ferguson pleaded guilty and accepted responsibility, thus assisting authorities in their investigation and prosecution, according to court documents.

His attorneys, in crafting a character sketch of a businessman, veteran, father and mentor, are pushing for a sentence of supervised release with three years of home confinement, community service and restitution rather than prison.

Some of the letterheads include such names as former Treasury secretary John Snow (read his letter here), businessmen Wallace Stettinius and Austin Brockenbrough III, state Del. Christopher Peace and executives and former heads of Richmond’s upper tier law firms, financial firms, private schools, charities and churches.

Richard Cullen

Ferguson’s connections also helped him land free legal representation from one of Richmond’s biggest law firms. Richard Cullen, chairman of McGuireWoods and former state attorney general and U.S. attorney, agreed to represent Ferguson for free, along with McGuireWoods attorney Brandon Santos.

“There were friends and former business associates who were concerned and wanted to know how they could help,” said Will Allcott, a McGuireWoods attorney who is helping on the case. “Some came to us and asked us to represent him for free, which we agreed to do. Others coordinated this letter writing and sent them to us.”

Such letters are common in criminal cases leading up sentencing.

“It’s to give the judge some additional information and context about the individual,” Allcott said. “It’s an important part of the process to know who he is he as a person.”

There are letters from local attorneys from Troutman Sanders, Hunton & Williams and Thompson McMullan. There’s George Mahoney, president and chief executive of Media General. There’s Charles Stillwell, headmaster of St. Christopher’s School, from which all four of Ferguson’s sons graduated.

Even Billy Beale, chief executive of Union First Market Bank, one of the first banks to file suit against Ferguson for lying on loan applications, stated in a letter that the bank “would not be upset, or publicly express disappointment, if Mr. Ferguson were to be sentenced to probation rather than time in prison.”

Ferguson is described in the letters as a “legend for his skill and persuasiveness as a fundraiser for good causes.” And charities wrote letters summarizing the dollar amounts and time Ferguson donated over the years. A senior executive at the YMCA of Greater Richmond, for example, said in a letter that Ferguson had donated nearly $400,000 to the organization since 1993.

Several letters also describe the embarrassment Ferguson has suffered as a result of the bankruptcy and criminal charges, describing him as a “destroyed man.”

“While it is clear that Mr. Ferguson made an awful mistake in judgment that he openly admits, I believe that the very public personal crisis that Mr. Ferguson has suffered for the past two years has been sufficient punishment for his crime,” one letter pleaded.

A former classmate from Washington and Lee wrote: “I know that Allen is remorseful and embarrassed, particularly in the view of the view of the fact that we went to an institution with a strict honor code, meant to last throughout one’s lifetime.”

The judge’s sentence Friday will show whether the letter writing had any sway in the sentencing process.

But local attorneys say the notes can’t hurt.

“Judges really do make a point to read those letters and consider them in sentencing,” said John Davis, a white-collar defense attorney with Williams Mullen who previously was a prosecutor with the U.S. attorney’s office.

Davis said cynics will question whether one’s level of community involvement or perceived character should play a role in determining their sentence.

“Citizens can disagree on the answer to that question,” Davis said. “Judges do care about what you’ve done with your life. It can reduce sentences. A judge wants to know that a person in front of him has accepted responsibility and that the person is not a danger to society. And a judge wants to know if a defendant has a plan and a drive to improve and do better.”

James Bullard, a local white-collar criminal defense attorney, said the reputations of the letters’ authors also matter, particularly in an area the size of Richmond.

“When you have people who are prominent citizens writing on your behalf, that, I think does play a role,” Bullard said. “It does become part of the balancing that a judge considers.”

Ferguson’s hearing will be at 11 a.m. Friday in the federal courthouse on East Broad Street.

His wife, Mary Rutherfoord Mercer Ferguson, was not charged in the criminal case.

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18 Comments »

  1. Beth February 11, 2013 at 8:14 am - Reply

    Rich white guy steals millions, gets to sit at home with a leg bracelet. Poor black kids steals a CD player and does hard time in the federal prison. This free ride for Ferguson makes me SICK. He lied and stole millions. He is a hard criminal and should do real hard time like anyone else who steals millions. His ‘Old Richmond’ ties should not give him a free ride. That sickens me. As long as you belong to the CCV you can steal millions and be free to go on? Sick.

  2. Bruce Milam February 11, 2013 at 9:26 am - Reply

    Beth, I doubt that Alan Ferguson would disagree with you on your point. He’s given personally and raised hundreds of thousands of dollars for kids just like you describe above.

    I’ve dealt with him in a business deal and still feel that he’s one of the finest gentlemen I’ve ever met. I can see why he has so much support from the business and philanthropic community.

  3. Doug B. February 11, 2013 at 9:43 am - Reply

    Considering the details of the case, I wouldn’t have a problem with him getting home confinement.

  4. MJ February 11, 2013 at 9:58 am - Reply

    Money wins again, always will. there is no ‘justice’ in our courts; it’s who you know and how much money you have regardless of your character. lived in DC for decades and it’s proved there over and over again.

  5. Denise Golinowski February 11, 2013 at 10:17 am - Reply

    I’m sorry, but if this man didn’t have influential friends and cronies, this would not be an option. Is the Justice System not about justice but about WHO YOU KNOW? I simply cannot support the idea of judicial leniency unless it’s even-handed.

  6. FreeEthan February 11, 2013 at 10:31 am - Reply

    Steal thousands using a gun: go to jail. Steal millions using a pen: stay at home. I think it reflects poorly on those sticking up for Mr. Ferguson.

  7. Roxanne February 11, 2013 at 11:15 am - Reply

    Didn’t he lie about his financial condition/holdings (not steal), but then wasn’t able to repay the debt? Had he lied and then sailed merrily along, repaying the debt, when would the crime have been recognized?

  8. pc February 11, 2013 at 11:41 am - Reply

    Presumption here is that Mr. Ferguson planned to defraud the bank. My guess is that he thought he would be able to pay the loan back and everything would be fine. I am not sure he would have borrowed money by inflating his asset, had he known that he will not be able to pay back the loan. I am giving him benefit of doubt as it seems that he has lived his life helping others and community causes.

    i do not know mr. ferguson personally

  9. E February 11, 2013 at 12:19 pm - Reply

    This will be an interesting test for Judge Hudson, who is known for his tough approach to sentencing. I seem to recall the case of a prominent athlete, in which Hudson totally ignored the Fed’s far less stringent sentencing guidelines. In addition to losing his entire net worth, the athlete ended up with a 2-year sentence at Leavenworth. Perhaps unfortunately for him, said athlete neither attended or donated to St. Chris.

  10. Beth February 11, 2013 at 1:43 pm - Reply

    I am writing letters to any of his supporters to whom I give my business. I don’t do business with crooks nor those who support crooks just because they belong to the right country club. What’s right is right and saying he used to be kind or used to take all the applicable tax deductions for his donations does not absolve him for his gross theft. He should do the same time most of the people he claims to have helped had to do. Do the crime pay the time. Crooks usually are very nice: it is part of their manipulate nature.

  11. Tom February 11, 2013 at 2:34 pm - Reply

    “Steal thousands using a gun: go to jail. Steal millions using a pen: stay at home. I think it reflects poorly on those sticking up for Mr. Ferguson.”

    That is a stupid comparison. It is more comparable to someone lying on a credit card application and getting a card with a high limit – happens all the time and people aren’t locked up for it. Using a gun to rob someone is totally different.
    It should also be noted that several wealthy people in Richmond have faced criminal charges recently and have not gotten this type of support. So the support doesn’t just follow the $$$ and must reflect something positive about Ferguson.

  12. A February 11, 2013 at 3:04 pm - Reply

    This certainly solves the question of the Good Old Boy Network, doesn’t it? I’m just so glad to see he was able to contribute so much to local charities like Saint Christopher’s that he couldn’t keep up the payments on the loans that he lied to get.

  13. Tom February 11, 2013 at 4:27 pm - Reply

    Some of the commenters are forgetting the timeline of events. Mr Ferguson is a 75 yo man who has decades of honorable work along with giving to the community. This loan situation came about in tha last few years with the financial crisis. Many are acting like these loans funded his contributions etc.

    • A February 12, 2013 at 9:18 am - Reply

      Not saying his loans funded the contributions. That said-did his contributions end (or even diminish) while he was suffering this financial setback? Doubtful.

      He collateralized his loans with stock portfolios that didn’t exist. The banks aren’t blameless here, either….they’re the ones who loaned out money without verifying collateral. Would I be able to do that? No, because I’m not lifelong friends with the president of the Federal Reserve, Treasury secretary, and president of the bank.

      Honest, hard working people are being put through the ringer for loans of $10,000, $20,000, while Mr. Ferguson was extended hundreds of thousands of dollars on a wink and a handshake. And a bunch of lies. Big fat ones.

    • Jay February 12, 2013 at 9:59 am - Reply

      Or maybe he just never got caught in those early years?

  14. Vicki Barnhouse February 11, 2013 at 4:47 pm - Reply

    The personal financial statement forms that I have seen include a statement that the person submitting the information understands the financial institution will rely on the information provided when determining the creditworthiness of tthe applicant. If Mr. Ferguson knowingly provided false or misleading information, then I fail to understand why he should receive less of a sentence than anyone else who has done the same and admitted to it.

  15. FreeEthan February 12, 2013 at 9:33 am - Reply

    Two points: First, Mr. Ferguson worked for years as the principal of a financial services firm. He should be held to a MUCH higher standard when it comes to financial fraud. Second, giving money to charity does not neutralized fraud and theft. Dare I point out that Justin French donated substantial money to several local charities, yet no one is crying foul that he’s spending 16 years in Federal prison…

  16. Tom February 13, 2013 at 9:06 am - Reply

    @FreeEthan – the point about being held to a higher standard is well taken. I’m not claiminy the courts should have mercy on Ferguson but pointing out that there seem to be valid reasons why he is getting so much support. It is beyond being part of the “old boys club” and throwing around the money from the loan. As you point out, French did not get this kind of support. So perhaps those that are closest to Ferguson really do know him best.

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