N.Y. man gets year in prison for Maxim magazine deal fraud: Reuters

(Reuters) — The son of a former United Parcel Service Inc executive was sentenced on Monday to a year in prison for orchestrating a fraudulent scheme in which he impersonated his successful father to raise money to buy the men’s magazine Maxim.

Calvin Darden, a Staten Island resident who was convicted a decade ago for undertaking a previous fraud as a stockbroker, was sentenced by U.S. District Judge Jed Rakoff in Manhattan after pleading guilty in 2014 to wire fraud charges.

Darden, 41, had sought to avoid prison by testifying against Harvey Newkirk, his lawyer in the failed $31 million deal who was convicted last year on a wire fraud charge and sentenced in April to six months in prison.

But while Rakoff factored in the cooperation by Darden, who has already served 30 days in custody, he said it did not entirely erase his crime.

“He has spent too much of his life engaged in fraud and other misconduct,” Rakoff said.

In court, Darden said he was “sorry, ashamed and embarrassed to such a degree I don’t know the words.”

The case marked a second round of legal troubles for Darden, the son of Calvin Darden Sr, who is a board member at Cardinal Health Inc and Target Corp and former senior vice president for operations at UPS.

In 2005, the younger Darden, then a stockbroker, pleaded guilty to New York state court charges that he stole almost $6 million from his employers and investors and used some of the money to finance a mansion with a shark aquarium.

After serving about 4-1/2 years in prison, Darden was released and met Newkirk, with whom he began pursuing the deal to buy Maxim in 2013, prosecutors said.

To finance the deal, prosecutors said Darden and Newkirk, who worked at the law firm Bryan Cave LLP, provided fake bank account statements and emails to lenders to borrow more than $8 million and try to secure another $20 million.

Darden also impersonated his father on phone calls and in emails and forged documents stating that the elder Darden would provide collateral for the deal, prosecutors said.

His efforts led to the announcement that Maxim’s then-owner, Alpha Media Group Inc, partly owned by private equity firm Cerberus Capital Management LP [CBS.UL], would sell Maxim.

The deal fell apart, and Darden was arrested in February 2014. Alpha Media eventually sold Maxim to Biglari Holdings Inc.

The case is U.S. v. Darden, U.S. District Court, Southern District of New York, No. 14-cr-00534.