Pelham man sentenced for lawsuit scamPublished 2:03pm Thursday, February 28, 2013
FROM STAFF REPORTS
A federal judge on Feb. 28 sentenced a Pelham man to three years and one month in prison for laundering money in a scheme with his daughter that collected more than $400,000 for expenses of a lawsuit that never existed.
U.S. District Judge C. Lynwood Smith Jr. sentenced Paul Haskell Lane Jr., 69, to prison and ordered him to pay $343,900 in restitution to 20 victims of the scam he perpetrated with his daughter, Katherine Hope Lane, 28.
The judge also ordered Paul Lane to forfeit $10,500 to the government as proceeds of illegal activity. Paul Lane pleaded guilty to the money-laundering charge in August.
Lane’s sentencing capped a six-year investigation and prosecution effort by federal and state authorities. In late 2009, Lane and his daughter were separately indicted on charges of wire fraud, mail fraud and money laundering related to their roles in a plan to get people in other states to wire money to Lane’s bank account. Those who sent money were led to believe it would go toward costs for a personal-injury lawsuit filed by the Lane family after Katherine Lane suffered a brutal assault at work.
The Lanes claimed proceeds from the lawsuit would be used to repay people who donated. Most who provided money also believed that they would get back from the Lanes more money than they sent. Katherine Lane, however, had not been assaulted and the Lanes had no lawsuit.
Over the course of several years, Paul Lane took the money wired into his account and gave it to his daughter.
Katherine Lane pleaded guilty in 2010 to wire fraud, aggravated identity theft and money laundering. She was sentenced in 2011 to seven years and three months in federal prison. Katherine Lane also pleaded guilty to felony state securities fraud charges related to her actions. Her sentence of seven years and three months on the state charges was ordered to run concurrently with the federal sentence.
The Internal Revenue Service, the FBI and the Alabama Securities Commission investigated the case. Assistant U.S. Attorney Melissa K. Atwood prosecuted the case.