Saturday, March 20, 2004

Sobbing Erpenbeck apologizes

Victims describe their troubles before judge decides sentence

By James McNair
The Cincinnati Enquirer

DOWNTOWN - Convicted swindler Bill Erpenbeck stood behind a courtroom podium Friday and gave a sobbing apology for the crime he committed, nearly upstaging the testimony of 15 victims who said his chicanery left them with personal and financial problems that persist to this day.

It was another turn in the federal bank fraud case against Erpenbeck, who led what once was one of the biggest home-building companies in Greater Cincinnati.

Between 40 and 50 people attended the hearing led by U.S. District Judge Arthur Spiegel, who wanted to hear from victims before he sentences Erpenbeck March 29 for one count of bank fraud. In the hourlong session, people who bought houses and condos from the defunct Erpenbeck Co. told how they were driven to medication, psychological counseling and impoverishment.

"This has been the very worst experience of our lives," said Dacha Hicks, who with her husband, Brian, owns an Erpenbeck condo in Boone County that is now in foreclosure. Hicks and the other victims gave their accounts at a podium just 10 feet from Erpenbeck, who sat in a black-and-white striped jail suit and black sneakers.

With Spiegel's consent, the 43-year-old former homebuilder took the podium after it was turned around so he could face his accusers.

"I deeply regret the actions have caused you pain," he said through tears. "I wish I could take it all back. I will spend the rest of my life trying to make up for the losses and the pain that I've caused. I will never forgive myself. I'm very sorry."

Several members of the audience jeered. One man barked, "It's another lie."

Spiegel, who called the hearing an "information session," thanked the speakers. Since taking over the case from U.S. District Judge Susan Dlott Feb. 6, Spiegel has not remarked on the case other than to call it an "unfortunate situation."

Federal prosecutors want Erpenbeck imprisoned for 30 years, the maximum sentence. Erpenbeck's lawyer, Glenn Whitaker, is seeking probation or house arrest.

The former homebuilder, his sister, Lori Erpenbeck, and another Erpenbeck Co. employee pleaded guilty to bank fraud in 2003 in connection with a three-year scheme that put the company out of business, forced the sale of Peoples Bank of Northern Kentucky, and left homebuyers, subcontractors and banks with tens of millions of dollars in claims.

Erpenbeck was arrested in an FBI sting last month and accused of tampering with a government witness called to testify against him at a sentencing-related hearing - his sister, Lori. Also arrested was Erpenbeck's father, Tony.

After the hearing, many victims said they were pleased to have had the chance to address the judge.

"I thought it was a wonderful thing to do," said Richard Hellmann, a homeowner in Erpenbeck's Fairways at Wetherington condominium development in West Chester. "He was focused on every speaker who came up."

Bonnie Kays, a member of the Fairways homeowners association's board of directors, was tickled to see Erpenbeck grovel, in contrast to the cocksureness she said he displayed in 2001 when he refused to honor a $35,000 contribution to the homeowners' group.

"It was nice to see him humbled and in prison garb," Kays said. "His whininess didn't sway me one bit."

Louise Schulte, 86, said she paid cash for her condo in Sherwood Lakes in Florence in 2000, only to learn later that it had a first mortgage that Erpenbeck never paid off. She said she has had to spend thousands of dollars more on lawyers.

"I used all my life's savings to do this," Schulte said. "My greatest intentions are that the liens will be released. ... I hope to live to see it resolved."

Some of tha most gripping testimony came from Mary Rita Jordan, who owns a condo in the Steeplechase development in Boone County. She said portions of her street are "falling in" and that Erpenbeck failed to provide snow removal and other services.

Jordan said she was the sister of the late Thomas Jordan, an Erpenbeck Co. executive who died of heart failure in 2003. She said her brother tried to persuade Bill Erpenbeck to call the FBI sooner than he did. Erpenbeck reported the fraud in March 2002, a month before the company closed its doors. He later claimed his sister, Lori, initiated the fraud. Bill Erpenbeck tried to make her brother a scapegoat after his death, Jordan said, referring to transcripts of FBI surveillance tapes submitted in the witness tampering case.

"Ultimately, the stress proved too much and killed him," she said. "My family will never recover from the loss of my brother. Think of that every day."



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