UPDATE A federal judge in Hartford today sentenced Westporter Robert D. Graham, a former General Re Corporation executive and former member of the Westport Board of Finance and Planning and Zoning Commission, to one year and one day in prison and fined him $100,000 following his conviction on fraud charges. 
Robert Graham: “I realize there are no do-overs in life.” WN file photo
The sentence, which is to be followed by two years of supervised release, was handed down by Judge Christopher Droney, who again rejected federal sentencing guidelines in sentencing Graham, 61.
He is the last of five former Gen Re and American International Group, Inc. (AIG) officials to be sentenced since they were convicted in February 2008 following a five-week jury trial. (See WestportNow Feb. 25, 2008).
“I realize there are no do-overs in life,” Graham told Droney. “Nothing I can say or do now can change what has happened or its impact on the lives of others or on me. Your honor, I regret that more than words can adequately express.”
Graham said he was very proud of having developed a reputation for honesty and integrity during his three decades as an attorney.
“That’s all gone now,” he said. “Instead of my career and reputation as a lawyer serving as a good example to others, as a disgraced and disbarred lawyer they will now serve only as a cautionary tale.”
Droney ordered Graham to report to prison on June 3. His lawyer, Alan Vinegrad, said he would ask the court to allow Graham to remain free pending appeal—something granted to the four others sentenced previously.
The arrests stemmed from what prosecutors said was a fraudulent scheme to manipulate AIG’s financial statements that the court later estimated cost AIG shareholders more than $500 million.
That involved amount, under recommended sentencing guidelines, could have resulted in life sentences.
The defendants put together a bogus reinsurance transaction that allowed AIG to fraudulently report about $500 million in loss reserves “to mislead AIG’s shareholders, stock market analysts and the investing public,” the original 2006 indictment said. (See WestportNow Feb. 2, 2006)
The conspiracy was designed to make it appear AIG’s loss reserves were growing in order to pump up the price of AIG stock, according to the indictment.
Graham, employed as a Gen Re senior vice president and assistant general counsel from 1986 through October 2005, was found guilty on charges of conspiracy, securities fraud, false statements to the SEC, and mail fraud.
Droney said Graham played an important role in the fraud, because he drafted bogus legal documents designed to hide the wrongdoing from investors and regulators. He said a factor in the sentence was deterring others from committing corporate fraud.
“He didn’t want others to connect the dots,” the judge said. “This is hardly the kind of ethics or conduct lawyers should follow.”
Droney also took issue with Graham’s claim that he only spent a few hours working on the deal. He said Graham’s involvement spanned several months.
Graham’s wife, Evelyn, and three friends also testified today, saying his convictions were the only departure from a life of honorable work, community service and helping those in need. Dozens of other supporters wrote letters to the judge. About 30 people attended the sentencing hearing.
Graham served as a Republican member of the Westport Planning and Zoning Commission from 1995 to 1999 and was on the Board of Finance from 1999 to 2003.
Co-defendants in the case have already received sentences of one to four years. Graham remains free on $1 million bond.
