Disgraced Plainfield investment counselor Kenneth Courtright was sentenced to 7 1/2 years in federal prison Jan. 18.
Judge Matthew Kennelly sentenced the 53-year-old for running a Ponzi investment scheme that defrauded more than 500 people out of more than $92 million and caused serious financial headaches for several area charities that were forced to repay hundreds of thousands of dollars that Courtright had given them.
Courtright had sought 12 months or less of home confinement. The prosecution had asked for a sentence of more than 20 years. With a requirement to serve 85 percent of his sentence, Courtright, who was free on bond pending sentencing, will spend more than six years in prison.
Courtright owned and operated Today’s Growth Consultant, which did business under the name The Income Store. Operating from his home, he had solicited investors — referred to as “site partners” — to put up six-figure fees that would be used to “purchase, create, market, and/or maintain websites designed to generate operating revenues.”
Those investors were guaranteed an astounding 180 percent annual returns on their investments — 15 percent per month in perpetuity. That is not how things went.
At trial a forensic accountant testified that “only about $12 million came in from website income, but that about $49 million was paid to site partners.”
In denying a post-trial motion to acquit Courtright last week, Judge Kennelly said the evidence presented at trial showed that Courtright “had the clear intent to deceive investors for the primary purpose of gaining additional funds with which to pay earlier investors’ promised returns and to fund his affluent lifestyle.”
Kennelly said the jury correctly found that “that there was never anywhere near enough revenue from website income to make the guaranteed monthly payments to investors, which is how they were told the funds to make the payments would be generated.”
“The evidence at trial showed, however, that the investors’ upfront fees … were used to pay nearly all of The Income Store’s expenses — including payments to other investors — and not just the expenses to acquire, market, and maintain the particular investor’s website,” Kennelly wrote.
Prosecutors argued in a sentencing memo that Courtright’s “background makes clear that there was no financial need for defendant’s fraud and that his actions were based on something more, namely, ego and greed.”
Substantial amounts of money were diverted from the business to pay Courtright’s home mortgage, “totaling over $500,000, and tuition for family members, totaling over $400,000.”
Significant sums of money also went to several regional charities, including a church in Joliet that was nearly forced to sell its property after a receiver forced it to reimburse investors $487,000 in donations from Courtright’s businesses.
The judge received more than a dozen letters expressing support for Courtright and his character, including from his wife and other family members. Kerri Courtright insisted that her husband’s business was not a Ponzi scheme, and that he accounted for every dollar he received.
She called her husband “a man of integrity who does the right thing even when nobody is looking.”
But victim impact statements reflected the profound emotional and financial devastation Courtright’s crimes caused a great many people who trusted him.
“The emotional and mental effect on me has been significant,” one victim said. “Everything I have done in my adult life has been to help and protect my family and it seems to me I let them down.”
“Losing $500K led to mental health issues, strained relationships with my wife, and ultimately in our divorce,” said another victim. “It shattered all hopes and dreams of early retirement and financial stability.”
“Feeling scared, deeply depressed and angry, with the need to borrow money from family to survive has been our daily emotions,” said another.
“I felt as if I couldn’t even trust my own instincts anymore,” said another victim. “I also felt terrible that I had endorsed Ken and The Income Store to others, knowing they took my word and reference and made an investment with him as well.”
The prosecution underscored “the profound and far-reaching psychological, emotional, and financial harm” that Courtright caused others, arguing that a substantial prison sentence would “send a message to the public that white-collar criminals are not treated differently than others.”