Copyright 1994 Bergen Record Corp.
CON MAN GETS PRISON IN PENSION SCHEMEBy CHRISTOPHER KILBOURNE
A con man who served time for a self-chilling beer can scam was sent back to the cooler Thursday for plotting to tap $100 million from the nation’s largest pension fund.
Marshall Zolp, 45, formerly of Alpine, was sentenced to 6 ½ years in prison for his elaborate scheme to loot the California Public Employee Retirement System.
Despite the decorated Vietnam War veteran’s cooperation with authorities, a judge rejected the government’s recommendation for a lighter sentence.
“You are the consummate racketeer,” U.S. District Judge Alfred J. Lechner told Zolp. The judge said the conduct of Zolp -- who was still in a halfway house from his last run-in with the law when he launched the pension scam -- has been “just unbelievable.”
“There is no doubt in my mind that at this very moment you are conjuring up another scheme and that, as soon as you get the opportunity, you will perpetrate that scheme,” Lechner said.
Zolp’s scheme revolved around what he described as an entirely new financial instrument called a Gross Revenue Investment Dividend, or GRID, which would have purportedly provided investors with high returns at minimal risk.
Prosecutors said Zolp and others raised $570,000 to finance the project by illegally manipulating stock prices. His next step was to try to market his GRID system to the investing public by creating a prospectus for a company called Kovac Securities Inc., authorities said.
When the FBI caught up with Zolp in October 1990, he was negotiating with a former trustee of the California pension system to secure an investment of $100 million from the fund. The former trustee, who has not been identified, was to receive a 10 percent kickback -- to be hidden in the accounts of a shell corporation overseas.
Zolp needed the help of others to run the scheme because he was barred from the securities industry in 1989 after his conviction in the self-chilling beer can case. In that scheme, Zolp and 12 others bilked $3.6 million from 1,400 mostly small, unsophisticated investors by faking financial reports and press releases to create the illusion that they held a patent and marketing rights for a self-chilling beer can, which turned out to bogus.
Zolp admitted Thursday that he violated securities laws, but he said he had no intention of stealing money from the pension fund or any other source. He told Lechner he was guilty only of “a zealous poverty of judgment,” and he asked the court for leniency.
Lechner, however, was not impressed.
“You have been given so many chances, so many opportunities,” the judge said. “Each time you appear in front of me, you play the same tune.
“I doubt that when you are released from prison you will last more than a couple of months before you commit another crime,” Lechner said.
Assistant U.S. Attorney Robert P. Warren struck a more optimistic note. “We hope that this is the final chapter,” he said.