Former Carolina Investors Executive Granted Parole Wednesday -

Former Carolina Investors Executive Granted Parole Wednesday

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Sterling was sentenced to 200 hours of community service and home detention at a hearing Wednesday morning. Sterling was sentenced to 200 hours of community service and home detention at a hearing Wednesday morning.

Updated: March 21, 2013

Pickens Senator Larry Martin criticized Jack Sterling's parole Thursday, on the S.C. Senate floor. 

Sen. Martin wants the Senate to consider a bill banning parole for non-violent offenders. If passed, the bill would only apply to future cases, not this one.

Sterling, the former chairman of HomeGold, served less than a year in prison when he was granted parole Wednesday. The state Paroles and Pardons Board was unanimous in their decision to release Sterling.

Sen. Martin called this a poor decision and wants a mechanism to appeal it to the full parole board.

Updated: March 20, 2013

Jack Sterling, former chairman of Carolina Investors, was granted parole from prison. He's been behind bars for less than a year.

Sterling was sentenced to 200 hours of community service and home detention at a hearing Wednesday morning before the South Carolina Parole and Pardons Board. 
We're told four investors in the former company Carolina Investors and the parent corporation Home Gold attended Wednesday's parole hearing.
Larry Madden, who lost his life savings when the company went under, was shocked to hear the news from his home in Pickens.  "That's just not right," he says.  Madden, like many, received word of the parole hearing weeks ago.  He wrote a letter to the board asking that parole for Sterling be denied.  "So many people were affected by this, and so many lives destroyed.  The buck stopped there, with Mr. Sterling," he says.
Sterling, 75, was sentenced to five years in prison for securities fraud. He began his sentence on April 9, 2012 and was projected to be released in September, 2014 according to the Department of Corrections website.
Madden believes the release is a "slap in the face" to victims.  Many, like him, have never fully recovered financially.  "I trusted all of them," he says.  "We don't have any luxuries, and we do without a lot of things now.  Years later, it's still affecting us."
Sterling plans to move to North Carolina from South Carolina.
He stayed out of prison for three years while appealing his sentence. 

Sterling has been serving time in the Livesay Correctional Institution in Spartanburg.

Reason for Parole?

So why did the parole board release Sterling after less than a year in prison? As a matter of policy, members of the parole board will not talk to the media about their decisions.

But paperwork given to the media by Sterling's attorney lays out his case for parole.

1. The jury acquitted Sterling of making false statements to the Securities Commission and it acquitted him of conspiring with the other defendants. All of the other defendants either illegally used HomeGold money for his own benefit or lied to investors.

2. The jury did not find that Sterling intentionally misled investors; it found that he was "severely reckless."

3. Sterling admits his culpability. Even though he never lied to any investor, he willingly admits that he wishes he had done more to protect investors from continuing losses. Sterling never sold a single share of his stock, losing more than $2 million in HomeGold, and he lost $75,000 of personal funds that were invested in Carolina Investors.

Former attorney general Henry McMaster, whose office prosecuted Sterling and all the Carolina Investors/HomeGold cases, says, "I think most people would've preferred a longer time, but, all things considered, especially his age, I think justice is being served when you look at the totality of it."

But he says this case also highlights something he pushed the entire time he was attorney general. He wants to eliminate parole entirely, like the federal system has done. The state has already eliminated it for violent crimes.

Sen. Larry Martin, R-Pickens, sponsored a bill right after Carolina Investors went bankrupt that allowed the state grand jury to investigate securities fraud. The law passed quickly and allowed the attorney general to prosecute the cases.

Sen. Martin says, "I have heard from some victims and victims' relatives, who just very much believe that the system sort of let them down in this instance."

He agrees with McMaster. "It causes me to really seriously think about moving more in that direction as a policy matter, just eliminating parole altogether for all categories of crime."

A spokesman for the state Department of Probation, Parole and Pardon Services couldn't give an exact date for when Sterling will be released from prison, but said it would be in the next few days.

Posted: March 19, 2013

An Upstate man, serving time for one of South Carolina's biggest fraud cases, will have a parole hearing Wednesday in Columbia.

Jack Sterling is currently serving a 5-year prison sentence for his role in the 2003 collapse of Carolina Investors and its parent company, HomeGold. 12,000 people lost more than $275 million when the company went bankrupt in 2003.

Mark Powell at the Attorney General's Office say they plan to oppose parole for Sterling during Wednesday's hearing.

During Sterling's trial in February 2009, the former HomeGold board chairman claimed he never intentionally misled investors and never lied to them about the company. A jury still found him guilty of securities fraud. However, they found Sterling not guilty of conspiracy.

Sterling was released shortly after the verdict came in, on a $100,000 bond. During that time, his attorney worked on filing an appeal. Sterling claimed the state failed to prove its case, and a judge should not have allowed heart-breaking testimony from investors who lost nearly everything.

However, the State Supreme Court rejected Sterling's request to overturn his conviction in April 2012. He began serving his 5-year prison sentence on April 9th, 2012.

Sterling was one of 6 executives who either pleaded guilty or were convicted in connection to this case. Some of the other executives include:

  • Ron Sheppard, Former Chief Executive Officer: 20-years in Prison
  • Earle Morris, Jr., Former SC Lieutenant Governor & Chairman of Carolina Investors: 44-months in Prison
  • Larry Owen, Former Carolina Investors President: 8.5-years in Prison
  • Ann Owen, Vice President of Carolina Investors: 90-days in Jail
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