April 26, 2012 in News

Man admits bilking $2.25M from investors

 

A Spokane con man had such a good sales pitch that he convinced a physician and a lawyer to take part in his get-rich quick schemes. In the end, some 10 investors lost more than $2.25 million they threw at his false promises.

Robert B. Hiatt, 57, pleaded guilty Thursday to eight felony fraud counts and a single count of intimidating a witness after he threatened to kill a whistleblower. Hiatt’s wide-ranging scheme promised huge returns on investments that never existed, Assistant U.S. Attorney Timothy Durkin said.

Hiatt “made the threats to kill (investor Larry) Brewer in an attempt to influence Brewer from further cooperation with law enforcement authorities,” Durkin wrote.

As part of the plea agreement, Hiatt agreed to pay back more than $2 million gained from his victims.

Hiatt presented himself to investors for a decade as a successful inventor and businessman and claimed to have inside tracks to contracts with major companies. He solicited investors using front companies that looked real.

In one of his schemes, he claimed to have a contract with General Electric on a “Shriker Chip” that purportedly had the ability to harness energy from lightning strikes.

To convince the investors, Hiatt created letterhead, e-mail accounts and other documents that made the companies – Highgate Computer Company and HighPlaces LLC – look legitimate. He charged investors fees to pay fictitious bills for attorneys, bank fees, taxes and other expenses.

By using the front companies, Hiatt was able to convince investors that he had patents and sales contracts with General Electric, the U.S. General Services Administration, Sears, Clorox, Rain Bird and the Pacific Northwest National Laboratory, according to court records.

Hiatt faces about 46 months in prison at his sentencing, which U.S. District Court Judge Frem Nielsen set for July 26 at 10 a.m.

The scheme lasted so long that the first three counts had exceeded the statute of limitations for prosecution. But Hiatt and his attorney, Matt Campbell, agreed to waive that as a defense as part of the plea agreement, Durkin said in court.

Court records identified 10 victims, including Bryan Teel of Davenport, who reported losses of $1.4 million. The victims include Dr. Stephen Smith of California and the late Howard Michaelsen, a longtime Spokane attorney, who lost $164,896 to one of Hiatt’s schemes.

Hiatt declined comment following the hearing. He will remain out of custody on home electronic monitoring until his sentencing.


There are three comments on this story. Click here to view comments >>

Get stories like this in a free daily email