First and foremost, I want to let all the ESS investors know that the Assistant United States Attorneys representing the Government in the Criminal Case are fighting for all the ESS investors to the very end! They are requesting that David Feuerborn receive a sentence of 63 months in prison, and that Tom Jennings receive a sentence of 57 months in prison. They are also requesting that they serve 3 years of supervised release, and pay the IRS $1,814,248. Obviously, we would have liked them to spend the maximum behind bars, but I believe the requested sentences are indicative, and encompass the magnitude of the crimes they perpetrated on the IRS and the thousands of investors that invested in ESS.
Here are some key excerpts from the Government’s Sentencing Position Regarding Defendant’s Thomas R. Jennings and David J. Feuerborn:
“From 2003 through 2007 alone, defendants, both personally and through various stock promoters they hired, raised approximately $16 million from hundreds [of] investors throughout the country” (Case 2:10-cr-00346-SJO; Page ID 2031).
“To date, ESS has never generated any profits (nor significant revenues) and investors have lost everything they put into the company. Moreover, defendants’ technology has never been proven to work as claimed. As explained below and proven at trial, unbeknownst to ESS’s investors, ESS’s accountants, ESS’s board members, and ultimately the IRS, defendants siphoned off millions of dollars invested in ESS into a secret bank account defendants controlled and then used that money to fund lavish lifestyles for themselves and their family and friends” (Case 2:10-cr-00346-SJO; Page ID 2031).
“Defendants used the diverted money for their personal benefit, including to purchase numerous cars (including a Porsche, a Dodge Viper, and a BMW), motorcycles, RVs, and jet skis; to pay for interior design and cabinetry work at their personal residences; and to purchase condominiums in Palm Desert, California. Defendant Jennings also wrote dozens of checks drawn on the Bogus Ecologic Account that were made payable to himself, to defendant Feuerborn, and even to his in-laws Alice and Ralph Bertania. (Govt Ex. 155.) Other such checks were made payable to his country club, golf cart companies, car leasing companies (eg., Mercedes and Lexus), auto detailing companies, and home improvement companies (eg., that sold granite counter-tops, fireplaces, patio furniture, and window treatments” (Case 2:10-cr-00346-SJO; Page ID 2034).
“[A]lthough defendants were convicted of conspiracy and tax fraud and not investment fraud, and while the IRS is technically the only ‘victim’ in this case for purposes of guideline calculations and restitutions, see Parts III and IV infra, ESS investors rightfully consider themselves victims of defendants’ lies and omissions. A number of ESS investors, in fact, have reached out to the government to tell their stories, and the government believes the Court should consider those stories in evaluation the 3553 (a) factors to determine appropriate sentences for defendants” (Case 2:10-cr-00346-SJO; Page ID 2037-2038).
“Disturbingly, several investors have informed the government that defendants are currently seeking to restart their business and are actively soliciting new investors, while minimizing the seriousness of their convictions and bragging that they will receive only probation in this case”(Case 2:10-cr-00346-SJO; Page ID 2038).
ESS Investors—your stories are being heard. The Assistant US Attorneys have even acknowledged the emails they are receiving from you, and they are using them to request the above prison terms! If you haven’t already, I urge you to share your stories with the Assistant US Attorneys so that they can include your stories in the sentencing hearing on June 27th (eric.vandevelde@usdoj.gov; daniel.b.levin@usdoj.gov).
Also, the US Attorneys’ Office is aware that they are trying to continue this scam, and I think they will be proactive in stopping everyone involved once and for all.
-ESS Investor
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