LV high-roller receives longer prison term

Wednesday, June 4, 2003 | 11:09 a.m.

SUN STAFF AND WIRE REPORTS

TRENTON, N.J. -- Former penny stock promoter Robert Brennan, already serving a nine-year prison term for fraud and money laundering, was sentenced to three more years Tuesday for violating a judge's order freezing his assets.

Brennan pleaded guilty last year to criminal contempt, admitting he violated an April 2000 order by U.S. District Judge Richard Owen in Manhattan when he paid $500,000 to his defense lawyer, Michael Critchley. The plea followed Brennan's 2001 conviction for hiding $4.5 million from bankruptcy creditors.

Owen in December added three years to Brennan's nine-year fraud sentence. The judge agreed to delay his order to let Brennan's lawyer submit additional legal papers. Owen Tuesday formally imposed the extra three-year sentence.

"Brennan appears to be without remorse for having harmed thousands of investors by his conduct," Owen said, according to a statement by U.S. Attorney James Comey. "He has attempted to avoid efforts to recover money taken from those investors."

Brennan said in court last year that he felt "categorical and unqualified remorse." He and his lawyer urged Owen to have the contempt sentence run at the same time as the nine-year term he's now serving. Owen refused and imposed a consecutive sentence.

Brennan was the founder of First Jersey Securities Inc., which went out of business in 1987. After his federal conviction in Trenton, N.J., in 2001, he ran afoul of Owen, who presided at a 10-year civil case brought by the Securities and Exchange Commission. That case resulted in a $75 million fraud judgment against Brennan and his company.

Owen took the unusual step of charging Brennan with criminal contempt. The judge ordered the U.S. attorney's office in Manhattan to prosecute him for the "circuitous and covert" payment of Critchley with funds covered by the freeze order.

In the New Jersey case, Brennan was convicted of hiding $525,000 in casino chips from his bankruptcy creditors and laundering money from the sale of $4 million in non-traceable bearer bonds. Authorities said he used the proceeds to travel the world by private jet and charter yachts.

Brennan had filed for Chapter 11 protection in August 1995, weeks after the SEC won the $75 million fraud judgment. Owen later placed a freeze on all of Brennan's assets that weren't included in his bankruptcy estate. The judge charged Brennan with contempt for trying to conceal from the SEC the $500,000 transfer to his lawyer's bank account.

Brennan is known in Las Vegas as a high-rolling gambler and because of his ties to the now-imploded El Rancho hotel-casino on the Strip.

A Brennan company, International Thoroughbred Breeders, at one point proposed to redevelop the then-dilapidated property into a new casino, but those plans fell through.

Among his bankruptcy fraud convictions, Brennan was found guilty of cashing in and failing to report as assets the $525,000 in casino chips at The Mirage hotel-casino in Las Vegas -- just three weeks after filing for bankruptcy protection in 1995.