PROVO It's been four years since an Alpine man used real-estate promises to siphon nearly $23 million out of about 311 victims, then promised to make things right after he got caught.
Michael J. Fitzgerald still owes nearly $20 million in restitution, but despite that, several victims asked Monday in 4th District Court that he not be sentenced in August to what could be 15 years in prison.
Instead, they want him to be allowed to develop 23 acres in Beverly Hills that could bring in the long-awaited restitution.
"Some of us have lost our homes over it, including me," said investor Howard Francis. "We have been hurt significantly. Lives will be ruined if we don't have an opportunity to do this.
"I know it's asking a lot of the court to postpone this, it has gone on for a long time," Francis continued. "(But) we'd really like to have some help and give this plan an opportunity to go forward."
Fitzgerald, 51, pleaded no contest in November 2004 to five felonies of securities fraud, unregistered securities agent and pattern of unlawful activity for allegedly selling promissory notes on developments in California with no collateral backing, according to a 2004 release from the Utah Division of Securities.
A previous attorney told the Deseret News in an earlier story that he believed Fitzgerald was duped by his brother, Charles Elliott Fitzgerald, who took investment money and fled the country. He is being prosecuted by federal and California authorities for similar crimes.
Numerous calls to Michael Fitzgerald's current attorney for clarification were not returned.
Charles Fitzgerald was indicted, along with eight others, in a massive "house-flipping" and mortgage fraud scheme in high-priced California neighborhoods, according to a 2007 release from the U.S. Attorney's Office for the Central District of California.
Charles Fitzgerald pleaded guilty on May 9 and is set to be sentenced Aug. 18, according to the U.S. Attorney's Office in California. However, his plea agreement is sealed.
In July 2006 Michael Fitzgerald entered his no-contest pleas, legally identical to guilty pleas, as a plea-in-abeyance, meaning that if he complied with the agreement which included paying off half of the restitution in two years the case would eventually be dismissed.
He failed to do so, and the agreement was broken. He will be sentenced Aug. 18.
However, sending Fitzgerald to prison doesn't solve the victims' problems, his attorney, Mark Griffin, argues.
Instead, Griffin and numerous victims want him to develop the prime Beverly Hills acreage.
"The property is unique," Griffin said. "There are very few parcels like this remaining in Beverly Hills."
The land's 15 owners have agreed to deed over half the proceeds to the victims, through Fitzgerald, once their original investments and debts are covered, said Brian Hansen, adviser to the landowners.
Fitzgerald had previously owned the land, but it went into foreclosure, Hansen said. When he didn't fight it in court, the new group bought it, and the agreement was tentatively made.
Without Fitzgerald on the project, Hansen said they would just sell the land as is, without developing it. But based on his ability to build retaining walls on steep, hillside property, the developed land would sell for more.
Based on prices for a similar development next door that's not quite as posh, Hansen and Griffin are projecting their area could bring in as much as $18 million a lot. There are five lots.
"It helps both of us if he doesn't go to prison," Hansen said, who is seen by many victims as a good Samaritan.
However, the developing process would be difficult and long, at least 2 1/2 years, Hansen said.
"I don't think these folks are going to see this money in their lifetimes," Judge Samuel McVey said. Many of the investors who spoke are senior citizens.
But some say they will wait. "This plan is the only way we can get our restitution," said investor James P. Kelly. "It is our only chance."
Prosecutor Chad Grunander said the Utah County Attorney's Office is weighing justice and public interest against the concerns of the victims and getting their restitution.
"He's been given ample opportunity and ... made some restitution," Grunander said. "But it's quite nominal in the grand scheme of things."
He called the development project "tenuous" and asked that sentencing continue as planned in August.
McVey was very clear that within a month he wanted a detailed plan from Griffin, including sworn statements, affidavits and property appraisals to assure him and the victims that the plan was legitimate."We've been through this before where he says he'll make restitution," McVey said. "I want to see how he's going to fulfill these promises."
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