Long Island man gets 5 years in prison for bilking investors who treated him like a son of $2M

MarketsAssociated Press

A Long Island man arrested as he tried to board a one-way flight to Israel a year ago was sentenced to five years in prison Tuesday for squandering over $2 million from investors who a judge said had treated him like a son.

Nizar Othman, 31, of Albertson, New York, was ordered to pay $2.1 million in restitution to victims.

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U.S. District Judge Lorna Schofield in Manhattan went above the top recommended sentence of four years and three months in the sentencing agreement Othman had signed with prosecutors. She also ordered him to undergo mental health treatment.

"This is a very serious offense. I'm still not convinced you appreciate the seriousness," Schofield told Othman, who has remained incarcerated since his arrest at Kennedy International Airport in November 2013. The government said he arranged the flight after learning that the FBI was investigating.

"People thought you were family, welcomed you into their homes and treated you like a son," she said.

The judge said he must develop a sense of moral obligation to people around him because his grandiose ideas "are not rooted in reality."

The government said Othman cheated investors from 2008 through March 2013 by using his personal relationships with them to win trust. A 70-year-old retired barber who fought in Vietnam lost his life savings of $480,000.

Several investors spoke, including Mary Butner, whose husband died in November 2010. Othman started his now-defunct Manhattan financial investment company while he worked as an information technology consultant for a mental health counseling company the Butners operated on Long Island.

He also had dated the Butners' daughter before working at their company, prosecutors said in court papers.

"I cared for you as I did my own children," Butner said. "We gave him a place to stay. Fed him. Nurtured him, like a son."

She said losing more than $1.4 million to Othman was more than a financial loss because she now fears getting close to people.

She and other investors described how the fraud had caused them severe depression.

As each victim spoke, Othman turned to look directly at them. He cried after the last investor warned him that someday he would have to explain to his infant daughter what he did.

The government said he failed to invest money as promised. Prosecutors said he used their money to finance his Manhattan investment company and to pay for dinners, clothing and travel. They said he also paid some money to his family and attempted to make payments to other investors.

Othman pleaded guilty in September to wire fraud.

At his sentencing, Othman apologized for "all the pain and stress I created" and vowed to work someday to repay victims.

"I'm so sorry," he said. "In a moment of weakness, I forgot what really mattered."