Hecker Co-defendant Leach Gets 27 Months
Steven Leach, a former executive of fallen auto mogul Denny Hecker, was sentenced Tuesday to 27 months in prison and three years of supervised release, and was also ordered to pay $14.2 million in restitution for his role in defrauding Chrysler Financial Services, LLC.
While working with Hecker, Leach allegedly falsified documents to lender Chrysler Financial to obtain $80 million in financing for the purchase of vehicles. In the end, Chrysler lost about $13 million.
Leach was indicted with Hecker in February 2010 for wire fraud and conspiracy to commit wire fraud. In his plea agreement, Leach admitted that from November of 2006 through June of 2009, he conspired with Hecker to defraud Chrysler Financial Services and other lenders to borrow money to purchase vehicles for its leasing company, which leased fleet cars to rental car companies.
He was originally charged with 14 counts and faced 20 years in prison, but four of those counts were later dropped. Under his plea agreement, the government agreed to dismiss all charges against him in exchange for a new conspiracy charge that carries a maximum sentence of five years in prison.
Last month, Leach filed documents arguing that Hecker should pay “most” of the restitution that he owes to Chrysler, but prosecutors argued that Leach “played a crucial role” in defrauding Chrysler and should be held responsible. The $14.2 million that Leach has been ordered to pay is the amount that prosecutors requested.
Leach must surrender to U.S. marshals on March 22 to begin his prison sentence, which will likely be served at the federal prison camp in Duluth.
Hecker's other co-defendant James Gustafson was sentenced last week to two years probation, 120 hours of community service, and a $1,000 fine for his role in the fraud.
Hecker faces up to 10 years in prison for two fraud charges and will be sentenced on February 11.