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For investor, prison

A Tampa judge sentences philanthropist Steven Green to 33 months.

By Jeff Testerman
Published February 27, 2007

TAMPA - Real estate investor Steven Green made so much money turning around run-down apartments that he could afford to split time between his Park Hill mansion in Yonkers, his $1.2-million home on Nantucket and his 8,157-square-foot place in Tampa's Hyde Park.

But after sentencing on federal tax and fraud charges Monday, Green soon will move to more austere quarters.

Rejecting pleas for probation or home detention, U.S. Judge Susan C. Bucklew sentenced Green to 33 months in prison and ordered him to pay $4.1-million in restitution. The judge also ordered Green to pay a $10,000 fine and to undergo treatment for alcoholism while in prison.

Bucklew allowed Green, a 42-year-old real estate investor and philanthropist with a net worth of $77-million, to report to prison within 120 days so he can put his business affairs in order. She granted him the eight months he said he needed to liquidate holdings in order to meet the restitution order.

In a 20-minute address to the court, Green said he was sorry for his crimes and described himself as a "one-man show" whose business empire might collapse if he were imprisoned, costing dozens of employees and subcontractors their livelihoods.

"I feel horrible, as you can imagine," Green said. "I've accepted responsibility. ... I worry that people will lose their jobs, and I feel horrible about that. I'm the one who's guilty. They're not."

Bucklew rejected that plea for leniency.

"Incarceration always has an effect on family and employees," the judge remarked. "This is no different."

Green faced a maximum of eight years in prison after pleading guilty in November to using a phony Social Security number in an application for a $9.04-million loan on the Amberwood Apartments in northern Hillsborough and for failing to file income tax returns for 1999 to 2001, when his personal income exceeded $3.1-million.

Last month, Green made up his back taxes, except for penalties still being calculated, with a $912,613 check to the IRS. Determining the effect of his fraudulent actions in connection with the Amberwood loan was more cumbersome.

When he used the fake Social Security number in May 2001 to obtain the Amberwood loan, prosecutors said, Green was trying to hide a major blemish on his credit report: a $2-million judgment from New York City housing officials, the result of accumulated code enforcement fines on some of his properties. Green said he never intended to cause anyone a financial loss.

Instead, the fraudulent loan blew up in his face.

A fire in March 2001 severely damaged 20 units at Amberwood. County inspectors found hundreds of code violations and condemned the 212-unit complex, displacing dozens of tenants. An insurance company paid $716,000 to repair the fire damage, but agents for the lender refused to forward the money to Green.

Without insurance money to fix the code violations, Amberwood had no tenants, and Green's income dried up. Two months after the fire, Green stopping making payments on the distressed complex.

A foreclosure suit followed, and the bank sold the apartments for a $4.1-million loss.

In two hearings, Green and his attorneys argued that he had been victimized by a greedy lender and a cadre of tenants intent on vandalizing Amberwood to get rent rebates. Green's attorneys also said that he had been painted a villain by "yellow journalists" and that Amberwood's financial loss was neither foreseeable nor the fault of Green.

Bucklew disagreed.

"Any time you take out a loan, it's got to be foreseeable that if you stop paying, the mortgage company is going to foreclose," she said.

She ordered that he pay back the lender the $4.01-million loss.

Green and his attorneys stressed his good works, his efforts as a fundraiser and board member for several New York and Massachusetts nonprofits whose clients are AIDS victims, autistic residents and troubled youths.

Green's attorney, Louis Cherico, said Green was not the "avaricious slumlord portrayed in the press," but a "larger-than-life" businessman who personified compassion and caring by "not just writing a check, but going to the shelter to do the scut work."

Bucklew remarked that she had never seen a case where so many letters had been written praising a defendant for his charity. She also said she was impressed that Green, the only son of a New York firefighter and a Veterans Affairs Department nurse, had achieved so much "without family money."

Bucklew said Green deserved some leniency because neither the fire nor the withholding of the insurance money were his fault. But in the end, she decided that Green must take responsibility for the outcome of his fraudulent actions.

Because Green requires special treatment for chronic bowel disorder, his attorneys asked that he be incarcerated at medical facilities, either the Otisville Federal Correctional Institution 70 miles northwest of New York City, or the Federal Medical Center Devens, a military base 20 miles north of Worcester, Mass.

Bucklew said she would make that recommendation.

After sentencing, Assistant U.S. Attorney Robert Mosakowski said he was happy with the outcome, adding that Green deserved some leniency "because of his charitable works."

Green hurriedly left the courthouse with his attorneys. He smiled at a throng of reporters and their yelled questions, but replied only, "No comment, guys."

Jeff Testerman can be reached at testerman@sptimes.com or 813 226-3422.

[Last modified February 27, 2007, 00:33:14]