Posted on 12/24/2003 8:25:29 AM PST by Born Conservative
SCRANTON - He had just pleaded guilty to felony charges that could send him to prison for up to 10 years, but polka king Jan Lewan's spirits seemed high as he left a federal courtroom Tuesday. "Yes, merry Christmas," Lewan said when asked by a reporter if he had anything to say about his plea to bilking hundreds of investors out of at least $1 million.
Four of his investment scam victims who attended the brief hearing were not nearly as jovial.
"I know the money is lost. The satisfaction is he will be going to jail," said one victim, a Hazleton woman who declined to be identified.
Tears welled in the woman's eyes as she described how Lewan, also known as Jan Lewandowski, gained her trust by treating her "like a best friend.
"So many times he said to me, 'I promise, you'll never lose a penny,'°" she said. She declined to say how much money she lost.
The woman and her husband are among 400 people in 21 states who fell victim to Lewan's fraudulent financial scheme, federal prosecutors said. His guilty plea Tuesday to one count each of mail fraud and wire fraud ends his Pennsylvania case. He awaits resolution of criminal charges in New Jersey and Delaware.
Lewan, 62, promised investors returns of 12-20 percent on money invested in the Jan Lewan Orchestra, the Jan Lewan gift shop and other entities. However, the polka empire fell on hard times and Lewan was unable to pay promised returns when the notes matured, prosecutors said.
To cover up the financial crisis, Lewan admitted he began paying some investors with funds received from other investors. He also diverted some funds for personal use. All the while he continued to assure investors their money was safe.
Lewan will be ordered to pay restitution, but the prosecutor, U.S. Attorney Gordon Zubrod, and Lewan's attorneys, Frank Nocito and Phillip Gelso, say it's unlikely he'll be able to pay.
"There is no evidence Mr. Lewandowski has any money," Zubrod said.
Lewan faces a maximum sentence of five years and a $250,000 fine on each federal charge when U.S. District Judge A. Richard Caputo sentences him in March.
Zubrod said it's difficult to say whether Lewan would get the maximum sentence. In the federal system, defendants who plead guilty are typically given a "downward departure" that lessens the sentence's severity. But Zubrod said Caputo could consider an upward departure because Lewan continued to sell promissory notes after the Securities and Exchange Commission ordered him to stop.
"That could be considered obstruction of justice," he said.
Lewan previously pleaded guilty to separate securities fraud charges in Delaware that carry a mandatory two-year prison sentence. Zubrod said that sentence will run simultaneously to the pending Pennsylvania sentence. The Delaware sentence will be served first. Remaining time would be served at a federal prison in Pennsylvania.
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