RUTLAND — Vermont storyteller Malcolm “Mac” Parker and his former partner, Louis J. Soteriou, are going to jail for swindling millions of dollars from investors in a movie project.
In federal court in Rutland, U.S. District Judge Christina Reiss on Wednesday sentenced Parker, 56, of Addison to 55 months in prison. On Monday in the same court, Reiss sentenced Soteriou, 56, of Middlebury, Conn., to 84 months in prison. According to the Associated Press, the two men will each pay some share of $9 million in restitution they owe to investors.
Both men had previously pleaded guilty to charges of conspiring to commit fraud in connection with the “Birth of Innocence” movie project. That film was in the works for nearly a decade until state authorities in 2009 put a halt to Parker’s efforts to raise money to pay for production. After investigations by the FBI, IRS and state banking regulators, the U.S. Attorney’s Office in 2012 accepted Parker’s promise to plead guilty to swindling his investors.
In papers filed with the court, prosecutors explained that Parker raised more than $28 million from hundreds of people by leading them to believe they were investing in Parker’s “Birth of Innocence.” While much or possibly all of the film has been shot and some of it edited, it has not been completed; as an asset of Parker’s it is tied up in bankruptcy court.
Prosecutors said that less than $1 million of $28 million raised was spent toward the creation of a movie. They further said that approximately $4 million was sent to Soteriou, the silent partner who spent large sums of money on various luxuries, including more than $100,000 on hotel stays in Telluride, Colo. Parker supplied Soteriou with this money despite telling investors it would be used toward the movie production, prosecutors hammered. In court the government estimated that Parker received approximately one-fourth the amount of criminal proceeds received by Soteriou.
The film focused on a spiritual journey. Although Parker had no filmmaking experience, he had built a reputation as a Vermont storyteller and was able to convince possibly more than 600 people to invest in the film. He promised double-digit returns on investments and paid off some investors in what the Associated Press termed a Ponzi-like scheme.
Parker told the Independent this spring that Soteriou, who, as his spiritual advisor had a central creative role in the film, instructed him not to divulge his role in “Birth of Innocence.” Nevertheless, Parker made payments to Soteriou of millions of dollars, as Soteriou promised him that all the investors would get their money back.
Many of the investors did not.
Soteriou was sentenced after an emotional six-hour hearing. Among those who testified was Parker, who told the court Soteriou used a “mixture of inspiration and fear” to manipulate him as they worked on their movie.
According to media reports on Wednesday, Parker’s hearing was also emotionally charged. The Burlington Free Press reported that Parker was shaking and crying as he apologized for defrauding investors. The Free Press also reported that 11 investors testified at the sentencing, with eight of them critical of Parker.
The jail term that Reiss gave Parker was almost two years longer than what prosecutors had suggested as part of a plea agreement. According to the Free Press, Reiss said in court that she was not convinced by arguments that Soteriou was more culpable for the fraud than Parker. The Rutland Herald reported that Reiss was troubled by Parker’s testimony that he blamed Soteriou but continued to solicit money from investors even after he knew that Soteriou could not pay them back.
Federal sentencing guidelines called for Parker to received a jail sentence of 72 months, but prosecutors asked for leniency because he was helpful in prosecuting Soteriou.
Both men were allowed to self-report to prison on a date set by the court.