Man sentenced for role in scam
al information to sell off hundreds of millions of unregistered shares.
When that cycle ran its course, Turino and others would reincarnate the companies with announcements of mergers and new business activities, and the process would start again. Several companies that drew investigators’ focus were incorporated in Southern Nevada.
In the plea deal his lawyers negotiated with federal prosecutors, Turino agreed to provide testimony against some of his alleged co-conspirators.
But the highly complex case has languished in federal court for nearly a decade. Two of the co-conspirators have died. One is a fugitive in Russia, and a prosecutor joked recently that his extradition is no more likely than that of NSA whistleblower Edward Snowden. Another’s health has declined to such a point that he is undergoing evaluations to determine whether he is fit to stand trial.
Assistant U.S. Attorney Kathryn Newman said Monday that Turino “has provided information that is useful” regarding the remaining defendants in the case.
The plea agreement allowed Turino to escape charges of racketeering, insider trading, money laundering and other stock fraud-related counts contained in a superseding indictment against him and nine others. It also eliminated his culpability in any crimes involving CMKM Diamonds Inc., a tiny company that represented the core focus of the federal investigation and resulting indictment. CMKM DIAMONDS INC.
The government charges that the defendants in the case misrepresent- ed CMKM as a profitable diamond mining company in order to induce investors while concealing its lack of any remarkable assets. The indictment included allegations that defendants illegally authorized the issuance of hundreds of billions of shares.
Defense attorney Kathleen Bliss wrote in her sentencing memorandum that Turino “did not manage or otherwise issue or cause to be issued any shares in CMKM. … He did, however, receive money from the sale of CMKM shares, approximately $4 million.”
Turino, in addressing the court, said one of his now-deceased co-defendants was “printing stacks of (securities) certificates” and selling them to investors.
“People were just simple victims of a scam,” he said.
Bliss blasted the government’s initial calculation of $70 million in criminal proceeds derived from the conspiracy.
“There is no way to prove $70 million in losses or even identify victims; this is the problem with most security fraud cases of this nature,” she wrote.
She also disagreed with the government’s description of Turino’s companies as hollow shells.
Acknowledging the judicial and prosecutorial resources Turino saved by admitting his guilt, Dorsey imposed a sentence of time served for the six years he was incarcerated before his conviction. The sentence was jointly requested by prosecutors and defense attorneys.
Dorsey also sentenced Turino to five years of supervised release. Contact Jenny Wilson at jenwilson@reviewjournal.com or 702-384-8710. Follow @jennydwilson on Twitter.