HOUSTON (AP) — An associate of a Texas financial adviser who committed suicide while under investigation has been sentenced to more than four years in federal prison after pleading guilty to a $1.4 million investment fraud.
Brian Bjork, of Missouri City, received a 52-month prison term, three years' probation and is liable for more than $1.1 million in restitution.
Bjork pleaded guilty in February to a single count of wire fraud in what federal prosecutors termed a "scam within a scam" run by another adviser, David Salinas. The 60-year-old Salinas fatally shot himself two years ago as a federal investigation of his alleged $50 million Ponzi scheme involving college basketball coaches was wrapping up.
Bjork's case involved bilking eight investors — mostly friends and relatives — plus $550,000 from the Houston Athletics Foundation, a nonprofit contributor to the University of Houston athletics programs. He was a former treasurer of the foundation.
"This is a sad day," Bjork, a former registered investment adviser, told U.S. District Judge Gray Miller just before the sentence was imposed. "I'm very sorry we're all here.
"I'm deeply sorry for breaching trust. ... I will do everything in my power to right my wrongs and pay back everyone."
Although his conviction carries penalties of up to 20 years and a $250,000 fine, federal sentencing guidelines applied to Bjork recommended a term of 63 to 78 months. Prosecutor Jason Varnado asked Miller to impose 72 months. Bjork's lawyer, Matt Hennessy, sought 30 months.
"Clearly, if Mr. Bjork is in prison he's not earning money to pay restitution for victims in this case," Miller said. "On the other hand, there is a need for punishment."
The judge said Bjork had no other criminal record and he thought the punishment range guidelines in this case were "greater than necessary."
"Under the circumstances, I think it's a fair sentence," Hennessy said afterward.
Varnado said he thought it was an appropriate and "significant prison sentence" that would deter other financial advisers from engaging in similar activity.
Bjork was a business associate of Salinas, the adviser who died of a self-inflicted gunshot wound at his home in the Houston suburb of Friendswood in July 2011 as the Securities and Exchange Commission was concluding an investigation of him.
Bjork and Salinas' estate are among the defendants in a civil suit in which the SEC alleges Salinas was the mastermind of a Ponzi scheme involving the sale of bogus corporate bonds.
Salinas ran a summer basketball program for high-profile high school players, and many of his alleged victims are current and former college basketball coaches, including Baylor's Scott Drew, former Texas Tech coach Billy Gillispie and former Arizona coach Lute Olson.
Bjork is a former student manager for the men's basketball team at Houston's Rice University and also a co-founder of Salinas' basketball program, Houston Select Basketball. Prosecutors said Bjork used his position as treasurer of the Houston Athletics Foundation to write checks disguised as bond investments. Similarly, Varnado said he used what friends and relatives thought was money for investments to build "his own personal slush fund."
"He took the hard-earned money of numerous victims ... and lived off it," Varnado said.