January 4, 2012 in City, Idaho, News
Ex-real estate agent sentenced in $2.2 mil. Ponzi scheme
Dale Edward Lowell just needed a bit more money. A few dollars here and there - anything to help him make another investment in a stock market he was sure he could figure out. It never worked, but, in his mind, success was just another investment away.
That’s what the former North Idaho real estate agent told a federal judge Wednesday when he was sentenced to three years in prison for a Ponzi scheme that collected more than $2 million from duped investors in the Sandpoint and Coeur d’Alene area. Lowell met many of the investors while a pianist for a Sandpoint church.
“I never considered for a moment I might fail,” Lowell, 59. He said he doesn’t know when he experienced his ethical collapse, “what I do know is that I did, and it had dreadful consequences.”
Lowell and his public defender, Jaime Hawk, asked Judge Edward Lodge to impose an exceptionally low sentence of six months in prison, but Lodge declined. Lowell said he never intended to defraud anyone, “yet from the very beginning you made false representations and assertions.” Lowell said his bipolar disorder contributed to the crime, but Lodge said the illness apparently had little effect on all other aspects of Lowell’s life, which had been commendable up until the fraud began.
Lowell pleaded guilty to wire fraud in August.
In addition to 36 months in prison, he is to be on probation for three years and perform 200 hours of community service. Lodge imposed the community service after noting Lowell is unlikely to make meaningful payments toward his $1.7 million restitution. The community needs to see the effects of his punishment immediately, Lodge said.
“I want the community to see from the sweat of your brow that you’re doing everything to make this right,” Lodge said.
Lowell, a father of four who now lives in Colbert, after his marriage ended, was allowed to stay out of custody to make arrangements for his parents and for an elderly man for whom he was caring. He’s to report to federal prison at a yet-to-be-determined date.
The judge said he planned to impose a lengthier sentence but didn’t because the U.S Attorney’s Office decided not to classify Lowell’s crimes as sophisticated, which would have increased Lowell’s sentencing range. Lodge questioned why prosecutors declined to pursue the additional time, saying it appeared Lowell had misrepresented himself as a skilled investor in order to perpetuate the fraud.
Lowell raised about $2.2 million from investors in “Dale’s Investment Club” between 2005 and 2009, when the Idaho Attorney General’s Office began investigating him. Assistant U.S. Attorney Nancy Cook, who prosecuted the case, said Lowell has not paid back any of the money, despite three civil orders to do so.
Lowell had no training in finance or investment, and he told his investors so. Still, he promised huge returns and fell into the classic Ponzi scheme - using new investments to pay old investors.
Lowell said he slept by his computer, awakening in the night to check stocks. Huge success was just always just around the corner, he said.
“I knew I would have it figured out by the end of the day, because I was so very close,” he said.
He sold household items like a lawnmower to get investment money. He also started riding his bike to church so he could invest his gas money.
He didn’t stop until the state forced him to do so.
“I deeply, deeply regret causing you pain, whether it be personal, financial or both,” Lowell told his victims, some of whom attended his sentencing and have lost their life savings. “My actions were wrong, sinful and unethical.”
Lodge said Lowell’s sentence is meant to send a message to others.
“Your case is not unique,” Lodge said. “It’s typical of these Ponzi schemes, and we’re dealing with them on a regular basis now.”