Federal Judge Curtis Collier on Friday afternoon handed a 9-year prison sentence to Daniel S. Geiger, who was convicted in the case in which over $11 million was swindled from the Standard Coosa Thatcher (SCT) Yarns pension fund.
Judge Collier said he was giving a sentence higher than the normal range "to deter other people who would abuse trust like this."
Prosecutor Gary Humble said Geiger and Kenneth S. Combs had "pillaged" the trust fund. Combs, of Hixson, took his own life after pleading guilty in the case.
Prosecutor Humble said there had been testimony in Geiger's lengthy trial about his getting $669,000 in cash, $71,000 for limousines, $275,000 for chartered planes and $51,000 for hotels from the pension fund proceeds.
He said he was spending thousands of the money on a stripper.
"To do what he did with this pension fund is despicable," the prosecutor said.
He called him a con man whose mode of operation is "lying, cheating and stealing."
He said Geiger earlier had been sued by the Securities and Exchange Commission for a fraud involving Liberian bonds.
The prosecutor said the federal Pension Benefit Guaranty Corporation had stepped in to help the SCT pensioners, but he said not all were made whole, including one who lost $100,000. He said it was the taxpayers who had to pay.
Geiger, who is 53, must begin making restitution at 10 percent of his earnings when he gets out of prison.
Geiger, in an emotional plea, said he may never get out alive. He said he has a terminal connective tissue disease that may take his life within five years.
He asked that he be allowed out for 60 days to gather up money to begin the restitution. He said he had two commitments for $675,000 and would work on coming up with $4.6 million more.
The judge denied the request.
Geiger, who said he had a religious conversion while in jail, said he had acted in the SCT case on the advice of attorneys.
Judge Collier said he would look into his request that he be incarcerated near Las Vegas, Nev., where his former wife, son and daughter live.
Geiger was convicted after a trial that lasted over two weeks and included some 40 witnesses - mainly defense.
He was convicted of three counts of wire fraud, three counts of kickbacks from an employee pension fund, one count of conspiracy to commit money laundering and six counts of money laundering.
According to the probation report, he faced 6.5 to eight years in prison.
During the trial, Geiger had to be rushed to the hospital several times after he collapsed. Attorney Jerry Tidwell said he suffers from high blood pressure and a heart condition.
Combs, the former president of SCT, pleaded guilty in the same case to 31 counts of mail fraud, embezzlement, graft, conspiracy to launder money and money laundering before his suicide.
Combs had been indicted in November 2002 on criminal counts involving multiple schemes to recklessly invest the assets of the pension plan. Combs received more than $155,400 in kickbacks from the reckless investments. He also converted pension assets for his personal use.
The pension plan lost $11,670,491 as a result of the improper investments.
Geiger was initially charged with 15 counts of wire fraud, bribery, money laundering, conspiracy to conceal and disguise the proceeds of a wire fraud scheme, conspiracy to launder money and money laundering.
SCT manufactured yarn for the textile industry.
The company sponsored two retirement plans covering 771 participants.
The Pension Benefit Guaranty Corporation later took over the retirement plans for hourly and salaried employees and benefits for retirees.