Whatever happened to ... that guy involved in the S&L swindles?

The sordid saga of William R. Runnells Jr. ended May 16. He was 67 when he died, according to the funeral home in Farmville that buried him in a family plot there.

A "notice of a defendant's death" was placed in his file in Norfolk federal court by Assistant U.S. Attorney James A. Metcalfe, who spent years prosecuting Runnells in what was one of the nation's largest savings and loan swindles.

Runnells, a high school dropout with expensive tastes, and his fourth wife, Marika Lody Runnells, founded Landbank Equity Corp. in Virginia Beach. They turned the small S&L into a mortgage giant, with offices in five states lending to people who should not have qualified for credit.

The company would falsify appraisals and charge the applicants huge up-front fees, then sell the worthless mortgages to other institutions.

At one point, Runnells bragged, Landbank was making him $1 million a week. The couple had a stable of luxury cars, one with sable floor mats, and Runnells was a fixture in Atlantic City, N.J., where he would sip green tea and bet $20,000 on a single roll of the dice.

When Landbank finally collapsed into bankruptcy in 1985, investigators determined that $52 million had been siphoned off. It was never recovered. Runnells would later claim he blew it all at the casinos.

The victims ranged from poor borrowers who lost their homes to massive institutions that failed under the weight of Runnells' bad debt.

William and Marika Runnells skipped town before their trial, leaving his 72-year-old mother, Lucille, to serve a year in prison for her role in the operation. His older brother John was sentenced to eight years and stepson Steven got two years after failing to track down his fugitive parents.

They were finally undone by the oldest of methods. A bored kid standing in a postal line in Virginia Beach recognized the couple on wanted posters.

They had resurfaced as hypnotherapists and had a successful business in California.

The couple got wind of the attention and fled but were eventually arrested in Dallas, where Runnells was posing as Dr. William Cabot Allen, master hypnotherapist.

The two were tried and convicted. Runnells received a 40-year sentence for a laundry list of conspiracy, racketeering, fraud and obstruction of justice charges. His wife got 31 years.

"There are other ways of destroying people besides poison or a dagger or guns," the judge said as he passed sentence.

They were both paroled after serving 10 years.

Runnells spent half his time in a prison hospital with liver damage. He received a transplant after his release, paid for by Medicare.

And they went back into the hypnosis business, quickly building an empire that included offices in Virginia Beach, Northern Virginia, Florida and New York.

Once again they were driving luxury cars and living the high life while neglecting to pay the $1 million in restitution ordered by the court.

Runnells was sent to jail for violating his parole, and a federal judge ordered the couple's corporations be dissolved after a prosecutor said he couldn't unravel their 123 different bank accounts.

The judge banned them from owning any other companies, but allowed Marika Runnells to work as an employee in hypnotherapy businesses.

Lucille Runnells, now 93, did not respond to a call to her home in Farmville on Friday afternoon. A man who answered the phone took the request and said Marika Runnells did not live there.

Tony Germanotta, (757) 222-5113, tony.germanotta@pilotonline.com