Feds seek 4-5-year sentence for ex-attorney in wire fraud case

December 4, 2017

A disbarred northern Indiana attorney who drained a grocery store receivership of more than $330,000 then covered up his crimes for more than a decade should receive a sentence of about four to five years in federal prison on Tuesday, prosecutors say.

Robert E. Stochel is scheduled to be sentenced in the District Court for the Northern District of Indiana. A jury convicted him of a single count of wire fraud in May after a prior trial ended in a hung jury. While a wire fraud conviction carries a maximum sentence of 20 years and a base level sentence of seven years, the government’s sentencing memorandum asks for a sentence in the federal guideline range of 46-57 months, as recommended in the court’s presentencing report.

“The offense is one in which the defendant, a lawyer, used his position as an attorney and the trust of the Lake Superior Court to execute a scheme (to) steal money from a receivership account he was appointed to protect, and to cover up that theft for as long as possible. As part of that scheme, he lied to the Lake Superior Court, he lied to the victims, and he lied to the victims’ attorneys. Nor is this the only time the defendant took funds from an account. In January 2012, not long before the theft of the receivership funds was discovered, the defendant took $30,000 from the law firm trust ... allegedly based on records and conversations with his partner, though he admitted that he and his partner ‘never agreed, ok, on thirty,’” the government says in its sentencing memorandum, quoting from Stochel’s deposition.

“The government believes that a sentence within this range reflects the seriousness of the offense, promotes respect for the law, provides just punishment, and affords adequate deterrence to similar criminal conduct,” says the sentencing memorandum drafted by Assistant U.S. Attorney Alexandra McTague. Federal prosecutors also request restitution in the amount of $229,091.97 — less than the $331,840 that once was in the receivership Stochel oversaw.

“The actual loss is less because after emptying the account, the defendant covered certain of the receivership expenses from his own funds to hide his theft from the victims and the court,” the government says.

Stochel “explained that he believed some of the money ‘belonged to him’ because he’d ‘earned some,’ and some he ‘expected to be earning in the future,’ so he viewed it as a ‘retainer’ ... though he also acknowledged that the court had to pre-approve all fee awards before he could be paid,” the memorandum says.

Stochel was appointed in 2000 as successor receiver after the Gary-based, family-owned Tip Top Supermarket Inc. dissolved in 1998. The Indiana Supreme Court suspended him in 2015. He was accused by the Disciplinary Commission of having depleted the receivership account by 2004, after which he repeatedly misled parties by falsely telling Tip Top’s owners for about a decade that he was close to wrapping it up.

The government in its sentencing recommendation also counts as aggravating factors Stochel’s “lulling” of the receivership parties and the court with misrepresentations; his violation of court orders; and his abuse of a position of trust. Mitigating factors include his lack of a prior criminal history.

Stochel’s attorney, R. Brian Woodward, asks the court to impose a sentence of no more than a year in federal prison with credit for time served. Stochel’s sentencing memorandum says he lost his career, his marriage, and the trust of his children as a result of the scheme. A formerly respected 32-year attorney who’d served as president of the Lake County Bar Association, Woodward wrote that Stochel also had served his community in many ways before the scheme unraveled. “This crime does not define Bob Stochel.

“… The embarrassment and shame he suffered was so immense, that he attempted to exit this world by his own hand,” Stochel’s sentencing memorandum says. “Fortunately, he was discovered. Since that time, he has undergone therapy by seeking professional help and has received appropriate medications to help him deal with his past transgressions.”

Meanwhile, Stochel also argues the statute of limitations should have required his acquittal.

“There is no case reported within the 7th Circuit where a ‘lulling letter’ sent some eight (8) years after the completion of the scheme has been found to be part of the scheme to make the defendant guilty of mail fraud. Of course, the Court will be able to personally observe and listen to Bob Stochel’s comments at the sentencing hearing to make a final determination as to the great remorse he has for his actions and the reason why he and his counsel elected to take this matter to a jury trial” to preserve the statute of limitations argument for appeal, Woodward wrote.

Sentencing is scheduled for 10:30 a.m. Tuesday before Senior Judge James T. Moody in the District Court for the Northern District of Indiana, Hammond Division. The case is United States of America v. Robert Stochel, 2:16-CR-30.


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