Specialty Filaments president sentencedBy Brent Curtis
STAFF WRITER | December 18,2012The former president of a defunct Middlebury company was sentenced to a five-year term of federal supervised release and was ordered to pay $300,000 in restitution for his role in a $1 million bank fraud.
Donald James Marler, the top executive for Specialty Filaments Inc., which closed its doors and declared bankruptcy in 2007, faced a potential 30-year prison term after he pleaded guilty to a federal felony for conspiracy to commit bank fraud.
But following a motion filed by federal prosecutors that asked for only a sentence of time served coupled with supervised release, Judge William Sessions decided that no incarceration was necessary in the case.
The sentence handed down for Marler is very similar to punishments delivered recently to two other Specialty Filaments executives who participated in the fraud.
Only in some ways, Marler’s punishment is more lenient.
Jeff Audette, the company’s vice president, and Paul Mammorella, its director of finance, were also ordered to pay restitution in the amount of $300,000.
But in addition to a three-year probationary period, Mammorella was also sentenced to four months of home confinement and Audette, who was facing a maximum five-year prison term for conspiracy to commit bank fraud, was sentenced to three years of probation.
As with Mammorella and Audette, federal prosecutors wrote in a sentencing memorandum that Marler was a good person who made a bad choice.
Faced with a sudden and unanticipated downturn in sales in 2006, Specialty Filaments executives decided to inflate the cash-strapped company’s accounts receivables and inventory so that Wells Fargo and the Vermont Economic Development Authority, which guaranteed a portion of the loan, would lend the company money.
“Without access to cash to buy materials, the company would have been doomed. This led president Marler ... to cut illegal corners with Wells Fargo, SFI’s lender, in a misguided but perhaps understandable effort to keep the business running and to keep the employees on payroll until a buyer for SFI could be found,” Assistant U.S. Attorney Gregory Waples wrote in his sentencing memorandum.
Waples went on to write that Marler was “genuinely remorseful” for his actions and not inherently a bad person.
“This was not a crime of greed or self-enrichment. The reason why all these essentially good defendants did what they did was to keep SFI afloat until a buyer who could invigorate the company was found. Had that goal been realized, Wells Fargo would have been made whole. The government does not expect that Mr. Marler will commit additional crimes or be tempted to do so. Little would be served by now sending him to jail,” Waples concluded.
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