By James McNair
The Cincinnati Enquirer

Facing years in prison for defrauding banks, home buyers and subcontractors, former home builder Bill Erpenbeck is suggesting that he instead be sentenced to probation, house arrest or to a federal halfway house.

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In a 16-page filing with U.S. District Judge Susan Dlott, Erpenbeck lawyer Glenn Whitaker wrote that the former Crestview Hills resident has paid an "enormous price" and is "deeply remorseful" for the $33 million bank fraud he pleaded guilty to in April.

Whitaker states that Erpenbeck "seeks the opportunity to atone for his mistakes." Imprisonment, he wrote, would deny Erpenbeck - whose company once was the fourth-largest home builder in Greater Cincinnati - the ability to make amends.

The filing was accompanied by letters of support from 24 people, including several emotional pleas to Dlott from members of Erpenbeck's family. "I love my dad," wrote his 14-year-old son Matthew, who has dyslexia and attention deficit disorder. "Please don't take him away from me and if you do I don't now what I will do. He is everything to me."

Erpenbeck is scheduled to be sentenced March 28. He faces a maximum prison term of 30 years and must pay restitution of $26.3 million. He must also forfeit his remaining assets and serve five years of supervised probation. His 9,000-square-foot house in Crestview Hills was sold in a U.S. Bankruptcy Court auction last year.

The sentencing will make a focal point of Dlott. Her husband, lawyer Stan Chesley, won a $16.8 million class-action settlement for 210 home buyers who were saddled with construction mortgages that Erpenbeck Co. failed to pay.

Although Erpenbeck was the first suspect to plead guilty and has cooperated with a multi-agency federal investigation, the government regards him as the central figure in a fraud that hurt 260 home buyers, 32 banks and an undetermined number of subcontractors and suppliers.

Erpenbeck admitted to endorsing checks written out to his construction lenders, a practice that allowed him to keep his company alive, but which left his creditors holding more than $100 million in unpaid bills and legal claims.

Some claims never resolved

Many claims were resolved through out-of-court settlements and the sale of uncompleted projects. Many more, however, were never resolved, such as down payments, warranty claims and bills for construction materials and services. Consequently, many of his victims remain bitter about the experience and oppose Erpenbeck's desire not to be imprisoned.

"If there is any justice, Mr. Erpenbeck will spend a substantial time in prison and should still have to repay those of us that have been swindled," said Laura Fairchild, who lost $1,000 on a down payment on an Erpenbeck condo in the Steeplechase development in Boone County. She now lives in Hendersonville, Tenn. "I believe he got off easy by not having a public trial. People like me that not only lost money, but the dream of owning a new home, never got the chance to be heard."

It took almost two years for James and Helen Kelble to clear the title on the house they bought from Erpenbeck in the Belmont Park section of Triple Crown in Boone County. It also took a lawsuit and a large amount of legal costs to erase two bank liens and 21 mechanics liens filed against their property.

"Erpenbeck continues to lavishly live with his family in another state while avoiding paying his just dues," James Kelble said. "We lived for 18 months, while he remained free, imprisoned with worry and fear of financial ruin. To let Erpenbeck walk away without a substantial amount of jail time is another crime."

Erpenbeck, who moved his wife and three children to Fort Myers, Fla., soon after his company collapsed in insolvency in April 2002, will be the subject of two February court hearings that will set the stage for his sentencing.

On Feb. 6, Dlott will hear Erpenbeck's objections to the contents of a pre-sentence report prepared by the U.S. Probation Office. The report has not been filed for public viewing, and Whitaker did not detail the objections in his court filings. On Feb. 26, victims share their thoughts with Dlott.

"The judge seeks to get as much information as possible to determine the most appropriate sentence," said Fred Alverson, spokesman for the U.S. Attorney's Office in Cincinnati.

Alverson said the government will respond later to Erpenbeck's request for probation, either in court or through court filings.

History with community

With projects from Union to Springboro, the Erpenbeck Co. in 2002 had almost $100 million in sales. Bill Erpenbeck, its president, was a third-generation builder who served as president of the Northern Kentucky Home Builders Association and as a member of the Northern Kentucky University Board of Regents.

Erpenbeck's record of civil and charitable contributions figures heavily in the defense filing with Dlott. Whitaker cites Erpenbeck's contributions to the Redwood School for mentally retarded children; his alma mater, Covington Catholic High School; NKU; and the American Cancer Society. Letter writers describe Erpenbeck, 42, as a compassionate man who became all the more caring of others following the death of his first wife to cancer in 1990.

"Primarily, through the media, you and I have heard and read about a side of Bill Erpenbeck which depicts him as a villain," Cincinnati lawyer Bill Geisen, who used to represent Erpenbeck's company, wrote to Dlott. "This character assassination does not paint an accurate picture of the man whom I have known for nearly 30 years."

E-mail jmcnair@enquirer.com