He Never Displayed Any Meanness

— Up there in the pantheon of California's 1990s financial swindlers is Donald Marquis Bickerstaff. Bickerstaff was charged in 1997 with a Ponzi scheme involving 75 investors, the majority women, in San Diego and Marin counties. The investors -- one was the unwitting mother of Bickerstaff's partner -- lost $11.8 million. Using client money, Bickerstaff bought multimillion-dollar homes in Poway and Mill Valley, a $93,000 Porsche and other sports cars, a 5.5-carat diamond ring, 31 thoroughbred horses in Kentucky and southern England, and membership in the Turf Club at Del Mar. At the time of his indictment, Bickerstaff was trying to keep his business, Bickerstaff Financial Associates, afloat; he was being sued for securities fraud by Prudential Securities; and his legal bills had grown sizable.

In U.S. District Court in San Francisco, the Scottish-born Bickerstaff pled guilty in 1998 to 40 felony counts, including mail fraud, wire fraud, money laundering, false statements on loan and property transactions, and more; he was sentenced to ten years. Federal guidelines required he serve 85 percent of that time, but Bickerstaff, who became a jailhouse lawyer and contested his sentence, won a partial reprieve. He served six years and was released in December 2003. After his release, he helped market his sister and brother-in-law's restaurant/bar in Palm Desert. He is banned, however, from doing licensed financial consulting.

What has life been like since his conviction? In an interview, the 46-year-old Bickerstaff, who now resides in Marin County to be close to his children, sounds beat, unaccustomed to speaking at length about his failures. "I have at least some immediate cause to be sorry and regretful, in the sense that justice has punished me for the last eight years and will continue to do so for some years to come."

His prison time began with a two-year stint at Eloy Detention Center, a privately run lockup in Arizona, "a real hellhole," as he calls it. There, he was the "only white guy" among 1500 Mexicans. "It took a while to feel safe," he says. "I could handle myself. But the odds are against you." He claims using his college education won him the trust of other inmates. As a clerk in the prison law library, he studied immigration law and represented himself and others in their status cases. Bickerstaff was held at Eloy because it was not clear whether he was a U.S. citizen. It took the testimony of his American-born mother, who was flown in from England, to prove that Bickerstaff was a citizen and couldn't be deported.

Transferred to the Federal Correctional Institution at Lompoc, Bickerstaff went through nine months of rehab, an intensive group-therapy program about criminal behavior. "They educate you to what they call 'criminal thinking,' " he recalls. "There's typical thinking in committing a fraud. Which is, I thought I could get away with it."

Bickerstaff's run began in the late 1980s, when he worked for Prudential Securities in Mission Valley, selling securities and insurance. In 1987, he took "rookie of the year" honors as the top salesman; the second year, "I was eighth out of 23,000 agents." He was promoted to sales manager, which meant a move to San Francisco with his wife and two kids. There, he led the entire company in sales for two years. After buying a home, he started Bickerstaff Financial Associates and opened an office in Rancho Bernardo and one in Marin. Then, he says, Prudential sued him "because it was standard operating procedure for them to sue anybody who was successful who had left." Bickerstaff is angry about that suit, believing it was wholly vindictive.

From 1992 to 1997, Bickerstaff took clients' money to fight Prudential's lawsuit and to prop up his business and standard of living. He choreographed the fraud, staging lavish Christmas parties and sending out fake statements to reflect his clients' healthy earnings. At racetracks, Bickerstaff got stable owners and horse trainers to invest; one, Jeff Bonde, who put up $750,000 of his and his family's money, lost it all. Bickerstaff left penniless a blind, diabetic woman whose husband, a typewriter repairman, had invested their savings ($280,000), then became ill with a bone marrow disease and died; the woman was put in a nursing home. Bickerstaff defrauded another couple (she, a clerk; he, a bus driver) of $87,500, which they had saved for decades.

In 1995, at the height of the scam, Bickerstaff separated from his wife, Mary Beth Greisofe, leaving behind two children. After a divorce marked by "restraining orders and court appearances," Bickerstaff met and married a San Diego woman (who prefers anonymity). In their first year together, Bickerstaff bought a multimillion-dollar home in Poway. One morning, after he'd flown off to London, presumably on business, the FBI came knocking. She was "blindsided by the fraud," she says. Within a year their Poway home and furnishings were seized. Once Bickerstaff was in prison, she had the marriage annulled. She recalls, "I couldn't believe this was the person I knew. He never displayed any meanness in our relationship."

Among Bickerstaff's lies were a master's degree in economics from London University's Birkbeck College, prior employment with the U.S. Treasury, a license to sell insurance and securities, credit lines with major banks, and millions of dollars in Charles Schwab portfolios. None of those he fleeced knew that he had been fired by Prudential Securities in 1991, that he was being sued by the company, or that in 1995 he had been prohibited from selling investments (and fined $50,000) by the National Association of Securities Dealers for counterfeiting financial documents. He was also forbidden to work as an investment advisor by the California Department of Corporations.

Bickerstaff today: "I knew what I was doing was fraud; I knew it was wrong." Prudential's lawsuit, he says, "drained my company of its money and all of my time. I had the option to go bankrupt or to use clients' money. I decided to use clients' money. I thought I could use their money and replace it without them knowing. I didn't really think I was 'borrowing' it," a claim he made during the trial that infuriated those he'd plundered. "I was justifying that to myself. One of the things I learned in the rehab program is that every criminal thinks that way. That's what makes him a criminal."

None of this deception was apparent in his pitches to investors. One investor, Larry Peltz, said that Bickerstaff "could analyze and understand financial markets in the most brilliant and convincing way. You will never, ever meet a person who can lie so convincingly and pretend to have such empathy." Bickerstaff told Peltz that he would take care of Peltz's mother. "I guess I was naive," Peltz recalled, "but I never imagined someone pretending to be [my] friend and then blatantly lying and stealing from [me]." Peltz and his mother lost more than $100,000.

In charge of the Rancho Bernardo office was Daniel Armentrout. He quit working for Bickerstaff in 1997 when he discovered that his boss had been lying about his education and his licenses. At the end of the trial, Armentrout said, "There is no sentence that could make up for all the pain and anguish his clients have gone through."

Former assistant U.S. attorney Robert Crowe, who prosecuted Bickerstaff, told me that of the money Bickerstaff stole, only "six cents on the dollar" was recovered. Thus, Bickerstaff's sentence included a restitution order of $10.5 million, which was later enlarged by an award from a civil lawsuit. The total amount has grown, with interest, by 6 percent per year. In 1998, the interest was a bit more than $50,000 per month. Bickerstaff now owes more than $17 million. His payments are a statutory "reasonable percentage" of his monthly income; though Bickerstaff is presently unemployed, he is paying $150 a month.

"The likelihood that I'll ever pay that off," he says, "is very remote."

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