A lawyer for a former part-owner of the New York Islanders said his client may try to withdraw his guilty plea after a judge said Wednesday she plans to sentence him to 20 years in prison for participating in a fraud that prosecutors said enabled him to misappropriate more than $50 million for his personal use.
Attorney Michael Tremonte abruptly ended a sentencing hearing for 70-year-old Stephen Walsh by asking that Walsh be given time to consider asking to withdraw his plea.
Tremonte told U.S. District Judge Miriam Goldman Cedarbaum in Manhattan that there was not another financial crime even remotely like Walsh’s that resulted in such a long prison term.
The judge gave Walsh until Tuesday to decide whether to try to withdraw his guilty plea. Minutes earlier, the judge had announced that she intended to sentence him to 20 years in prison, drawing gasps from friends and family members.
Walsh, of Sands Point, New York, pleaded guilty in April to participating in a fraud from 1996 through February 2009 that cheated institutional investors, including charitable and university foundations, pension and retirement plans.
During those years, Walsh operated a securities business with Paul Greenwood of North Salem, Connecticut. The businesses included Greenwich, Connecticut-based WG Trading Co. LP and Westridge Capital Management Inc. in Santa Barbara, California. Greenwood pleaded guilty in 2010 and is awaiting sentencing.
As part of his plea, Walsh agreed he would not appeal any sentence up to 20 years in prison.
Prosecutors have asked for a significant sentence to deter others, saying Walsh diverted more than $50 million from investors to live lavishly as he helped finance businesses started by his children and paid millions of dollars to his ex-wife.
Walsh, who remains free on bail, choked up as he apologized for the fraud, saying he was "deeply sorry."
Tremonte said his client had worked in finance since the late 1960s and started soliciting investors with the best of intentions. He said 99 percent of the money originally invested had been recovered.
As the lawyer tried to minimize Walsh’s role, saying he did less than his co-defendant, the judge interrupted him.
"He certainly had no trouble spending the profits," she said.