CHESAPEAKE
On the verge of a three-week trial, a Chesapeake entrepreneur suddenly agreed Friday to pay $47 million to the state and hundreds of customers nationwide bilked by his company's computer-purchase scheme.
To the surprise of many people in the Circuit Court hearing, George Christian abruptly accepted responsibility for collecting millions in monthly payments for computers and never delivering the goods.
But the money may prove difficult to collect - Christian and the company he founded, Financing Alternatives Inc., have filed for bankruptcy in federal court in Norfolk.
Christian declined to comment after the hearing.
FAI sold computers on layaway to people with poor credit histories. TV ads promised a "life-changing" experience. All consumers had to do was sign up for weekly or biweekly payments drawn directly from their bank accounts.
The state sued in 2007 for fraudulent business practices, after The Virginian-Pilot published several stories detailing consumers' problems with the company.
The state eventually charged that FAI failed to deliver $3.3 million in computer products to at least 1,765 full-paying customers. It identified more than 72,000 consumers who paid FAI at least $30 million between 1998 until it closed in October 2007.
Friday's agreement was the latest twist in a 2-year-old civil case. Christian, who is not a lawyer, represented himself.
Senior assistant attorney general Richard S. Schweik-er Jr. said in court Friday morning that Christian had repeatedly ignored the judge's orders and delayed the proceedings with odd behavior.
In one instance, Schweiker said, Christian consulted a large dictionary before responding to questions in a deposition. He said Christian refused to answer questions, instead asking state attorneys what they meant by terms such as "office," "employee" and "paycheck."
Near the beginning of Friday's hearing, Schweiker asked Smith to ban Christian from calling witnesses and introducing evidence.
Christian rose from his desk and told Circuit Court Judge Randy Smith he agreed. "We can end this trial," Christian said.
Then Christian and lawyers for the state disappeared into a conference room to negotiate the draft agreement.
They presented the result to Smith several hours later. FAI agreed to pay $30.4 million in restitution and $6.1 million in fines; Christian agreed to pay $8.6 million to consumers and $1.7 million in fines. Christian and his company will also owe the state $575,000 for legal fees and expenses.
In addition, the draft bars Christian from trying to have the debt discharged in bankruptcy court. Schweiker said the agreement is subject to approval by Virginia Attorney General William C. Mims. It is expected to be finalized at a Dec. 2 hearing.
According to filings in U.S. Bankruptcy Court in Norfolk, FAI claims less than $100,000 in assets, and Christian claims less than $500,000. Both list having liabilities between $10 million and $50 million.
Christian and his wife, Michele, live in a 6,000-square-foot home in Chesapeake assessed at $764,400.
Outside the courthouse Friday evening, Igrain Padilla smiled at the outcome. Padilla, an Army staff sergeant, drove five hours from his North Carolina home to testify against Christian.
Padilla had seen an FAI advertisement while he was stationed at Fort Benning in Georgia. He was recovering from wounds suffered in a roadside bomb attack in Iraq and decided to buy a laptop to keep himself busy during his rehabilitation.
Padilla paid $2,000 in 24 installments. His laptop never arrived, despite phone calls, complaints, and a personal trip to the company's headquarters.
"They threw in a free bag," he said. "I didn't get that, either."
Padilla added that he doubts he'll recover the money anytime soon.
Louis Hansen, (757) 222-5221, louis.hansen@pilotonline.com
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Too little, way too late
They had a chance to prosecute this guy years ago before he even bilked so many unsuspecting people. Everyone knew he was a crook and the Attorney General sat on the evidence for 9 long months without doing a thing. During this time Mr. Christian continued to rip off Virginia citizens and stash away millions. When the Attorney General finally took action 9 months later he did not even charge Mr. Christian personally. Who was this soft on crime, Attorney General, you might ask? Why, it was Bobs' Jobs McDonnell, our Governor. Who says you can't fail upward?
He won't get away
He has 72,000 enemies...someone will eventually get him to pay. The squeaky wheel gets the grease and there are 72,000 squeaky wheels out there. The difference between he and Wall Street thieves...you know who he is and where he is. You don't know where the Wall Street thieves are. This guy is insane. He is flaunting what he did to people and does not care if anyone knows him.
this is
A perfect example of why Judges should be elected.
Unbelievable!
A person robs a convenience store of less than a hundred dollar goes to jail for a few years and this guy who robs people of millions of dollars walks out of a courtroom after saying 'we can end this trial.' It's unbelievable! After all his shenanigans dodging the law, the judge actually accepted this deal and believes he'll be honest and forthright about it. One has to wonder what kind of back room deal the guy cut with the judge. Who says crime doesn't pay? Apparently it does if it's white collar crime.
ain't white collar crime grand!
steal 30 million dollars, walk in and out of court in your suit bought with stolen money. Lie to the court "I'll negotiate"...you're "bankrupt" there is no money. (you spent or hid it)
Trying holding up a 7-11. You might get 40 dollars. When they catch you, you'll be held without bail and get an orange jumpsuit awaiting trial.
Ain't white collar crime grand?
Is this related to the Blue
Is this related to the Blue Hippo scam? Or just very similar?
I agree that Christian should be locked up, BUT...
...I bet many of those that bought computers are the very same people who have been on the dole for years and scam the system any way they can for as long as they can.
So, in a way, they got their payback for being societal parasites.
jail time
Toss his lying A$$ in jail and throw away the key. The man has no morals. Granted people should have been a little more savvy about purchasing a computer on layaway when they are so cheap but taking advantage of poor people is no better than robbing a 7-11.
Honestly, nice guy finishes
Honestly, nice guy finishes last.
I think you will find many of the really successful people in our society are not really nice and perhaps often not so ethical (Look at Wall Street.)
Various people like Oliver Stone and the author of "Liar's Poker" have commented how they made their works to show the dark side of Wall Street and people, and weren't impressed to find tons of people looking up to the dark greedy people outlined in the stories.
MAKE HIM PAY IT BACK
How, the with the state of economics that we all are feeling, can he have done this, knowing all along, he was scalping people. We work hard for our money and trust that those we do "business" with are honest, too. I hope the judicial system makes him pay restitution to everyone, no matter how he has to come up with the money. Sell his house, car, cash in his 401K are whatever. I would be appauled to have been taken advantage of a crook. The US is in a financial crunch thanks to some unpopular and unwise decisions in D.C. It gets worse every time I turn the TV on. We are all being bilked for more money, our children and grandchildren. Pay through the roof for our health care premium, at least for now I have one and am able to pay it monthly. But the judicial system, same as our President, gives everyone their miranda rights, bla bla bla so I expect nothing to come of this either.
Shame on you!
He Used The System
Let's see...he declares both personal and business bankruptcy. He pleads guilty. What do you want to bet that he uses that bankruptcy as protection from paying anything. He doesn't have a job, his house will be attached by the bank. Cars are basically small change. I would sure like to see the original filing papers. I wonder where he stashed all of his savings. Nobody will win here. Jail time, we all pay. No jail, no money, no job, no payback. Would you hire him?
Make Him Pay
It is ridiculous how these companies bilk hard working people of their hard earned money. I hope this is not one of those cases where he pleads guilty, files bankruptcy, and then gets off scot free. He should be made to repay the people and do a significant amount of jail time, at least 3 years with no time reduced.