July 24 (Reuters) - A Chicago federal judge has refused to overturn the conviction of Eric Bloom, the former chief executive of money management firm Sentinel Management Group Inc, for defrauding customers out of more than $500 million.
Rejecting Bloom’s request for an acquittal or a new trial, U.S. District Judge Ronald Guzmán said the jury “clearly” had enough evidence to find that Bloom intended to cheat customers.
Prosecutors said Bloom did this by means that included falsely representing returns, pledging customer collateral to obtain a bank credit line that funded a risky house trading portfolio, and concealing Sentinel’s deteriorating finances.
Evidence such as recorded phone conversations and testimony from a former Sentinel chief compliance officer “was more than sufficient to establish guilt beyond a reasonable doubt,” Guzmán wrote in a decision dated July 23 and made public on Thursday.
“Because the evidence, if believed, was so clear and its probative value so devastating, it would have taken a conscientious jury very little time to reach this conclusion,” he added.
Lawyers for Bloom did not immediately respond to requests for comment.
Prosecutors accused Bloom of exposing customers such as futures commission merchants, commodity pools and hedge funds to risky transactions, in a four-year scheme that ended with his Northbrook, Illinois-based firm’s Aug. 17, 2007 bankruptcy.
Jurors deliberated for less than two hours before finding Bloom, also of Northbrook, guilty of 18 counts of wire fraud and one count of investment adviser fraud, after a four-week trial.
In seeking to void the conviction, Bloom objected that the “light speed” with which jurors convicted him showed they “were more interested in ending their service as soon as possible” than reviewing the evidence and applying the law.
Bloom also contended that his original trial was tainted by improper jury instructions, and the government’s misstating evidence during closing arguments.
Each wire fraud count carries a maximum 20-year prison term plus a fine. The government has sought a forfeiture of more than $500 million. Bloom has been free on bond.
The case was originally brought by then-U.S. Attorney Patrick Fitzgerald, who called it one of the largest fraud cases ever in Chicago federal court.
The case is U.S. v. Bloom, U.S. District Court, Northern District of Illinois, No. 12-cr-00409. (Reporting by Jonathan Stempel in New York; Editing y Steve Orlofsky)