(Updates with SEC case in eighth paragraph.)
By Chad Bray Of DOW JONES NEWSWIRES NEW YORK -(Dow Jones)- Ex-money manager Alberto Vilar and his business partner Gary Tanaka were convicted Wednesday on fraud and other charges for allegedly bilking investors out of millions of dollars.
In their fourth day of deliberations, a jury of five men and seven women found Vilar, one-time head of defunct Amerindo Investment Advisors, guilty on all counts, including securities fraud, mail fraud, wire fraud, investment advisor fraud and money laundering.
Tanaka, a one-time Amerindo director and officer, was convicted of conspiracy, securities fraud and investment-advisor fraud. Tanaka, 65 years old, was acquitted on nine other counts.
The most serious fraud charges - securities fraud, mail fraud and wire fraud - carry a sentence of up to 20 years in prison. The men were originally charged in 2005.
"We're deeply disappointed in the jury verdict," said Herald P. Fahringer, Vilar's lawyer. "We expected to be fully vindicated on appeal."
A bail hearing is scheduled in the case for Nov. 26. No sentencing date has been set.
Amerindo was placed in receivership shortly after Vilar's and Tanaka's arrests in 2005.
A parallel civil case by the U.S. Securities and Exchange Commission is pending.
Vilar, a longtime opera patron, and Tanaka had been accused of misappropriating client funds for personal expenses, charitable contributions and Amerindo's operating expenses.
One of the alleged victims was Lily Cates, the mother of actress Phoebe Cates.
The men also had been accused of engaging in a scheme to defraud investors in so-called guaranteed fixed-rate deposit accounts, or GFRDAs. Prosecutors said they didn't invest in short-term debt instruments as promised, discouraged investors from redeeming their investments and diverted money from other Amerindo clients to repay its obligations to GFRDA investors when those funds didn't perform as promised.
The securities-fraud count on which Tanaka was convicted was related to GFRDAs.
"The acquittal on nine of 12 counts demonstrates the substantial indecision of the jury in how to assess Mr. Tanaka's role," said Glenn C. Colton, Tanaka's lawyer. "We believe the guilty verdict was incorrect, though we respect the jury and the process."
Colton said they intend to pursue post-trial motions or an appeal to overturn the guilty verdict.
One jury, who asked not to be named, said Wednesday that deliberations became heated at times. Raised voices could be heard at times outside the jury room during deliberations.
On Tuesday, the jury sent out a note indicated they had agreed on all counts with regard to one defendant and were split on some counts regarding the another defendant.
After receiving the note Tuesday, U.S. District Judge Richard Sullivan, who is presiding, sent the jury back to continue their deliberations.
It wasn't clear which defendant the jury had made a decision on Tuesday. Several jurors declined to discuss whether it was Vilar, 67, and at least one juror said afterward that they continued to debate Vilar's guilt until Wednesday.
"We thought about him (Vilar) all the way through, to the last second," said Edith Linwood, a juror.
-By Chad Bray, Dow Jones Newswires; 212-227-2017; chad.bray@dowjones.com
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(END) Dow Jones Newswires
November 19, 2008 17:59 ET (22:59 GMT)

Publié le 19 novembre 2008 Copyright © 2008 Dowjones