Spano comeback

advertisement | advertise on newsday

Eight months after he got out of prison for

fraudulently attempting to take over the New York Islanders, John Spano went

back to his old ways, federal officials said yesterday.

Accused of defrauding a host of companies around the country, Spano was

arrested and arraigned yesterday in federal court in Cleveland.

Spano, after serving more than 5 years in prison for the Islanders scheme,

set up a firm called the Commercial Financial Group in the Cleveland suburb of

Westlake, according to a court complaint filed by Steve Bolz, an inspector with

the federal Postal Inspection Service in Cleveland. He used the company to

advertisement | advertise on newsday

scam more than a dozen companies, the complaint said.

Bolz's complaint said Spano rented a jet he claimed he owned to impress

victims and began to swindle numerous firms around the country through various

confidence schemes.

Spano, 41, promised to obtain loans for businesses, and then pocketed the

@Newsday

fees they sent him without ever delivering the loans, the complaint said. In

one complex variant of the scheme, Spano allegedly agreed to purchase

mechanical equipment that a firm wanted and then lease it to them for a fee.

Spano pocketed tens of thousands of dollars in fees but never delivered the

equipment, Bolz said.

advertisement | advertise on newsday

"He's the cleverest, sneakiest guy," said one of Spano's alleged victims,

Sandra Beard, president of Badger Lighting and Signs in Waukesha, Wis., in a

telephone interview yesterday. Spano is accused of swindling her out of $17,000

by collecting a "security deposit" on $100,000 in metal-bending machinery he

agreed to purchase and lease to her firm.

advertisement | advertise on newsday

When she complained, Beard said, Spano would regularly call her back with

seemingly plausible excuses why the machinery had not been delivered and her

money had not been returned. "I've got 147 voice mail messages from him," Beard

said, adding that when she finally became suspicious and started doing

research, she came across a John Spano who had been convicted in the Islanders

case. Beard said she asked him whether he was that person, and he said no.

Spano's attorney, Jerome Emoff of Cleveland, said his client is not guilty

and federal officials are criminalizing what is a civil dispute about payments

among business people.

Magistrate William Baughman held Spano without bail on fraud charges

yesterday, pending hearings next week.

Spano was on 5 years of supervised release after he was discharged from

prison in June. Gary Brown, head of the U.S. attorney's office on Long Island,

who was one of the prosecutors in the Islanders case, said yesterday his office

will seek to have Spano charged with violating the conditions of his release.

That could add an additional 2 years onto any fraud sentence.

Spano, who claimed to be a rich Dallas businessman, fraudulently inflated

his net worth and contracted to buy the Islanders in 1997 for $165 million. He

briefly controlled the team in what was considered one of the oddest happenings

in sports history.

At his sentencing in 2000, Spano said, "I made a terrible mistake. My

judgment has been incredibly poor. ... I don't know what came over me to do

what I did. I'm sorry for the people I've hurt. ... I'm sorry for the people of

Long Island who believed I was going to do something for the team."

Spano's attorney at the time, Nicholas Gravante Jr., added, "After he

serves his sentence, he hopes to get on with his life." Unfortunately,

prosecutors said yesterday, he did.

From Islanders scam until now

1997

Spano briefly takes control of Islanders, only to plead guilty that year to

fraudulently inflating his wealth to buy the team, and siphoning money from

it. He also pleads guilty to two other fraud counts involving other victims.

Sentenced in April 2000 to 5 years, 11 months in jail, he's ordered to pay

$11.9 million in restitution, undergo counseling and serve a 5-year probation

on his release.

Among the victims: the Islanders ($3.4 million); a Dallas pottery importer

($3.4 million); a Dallas loan lender ($1 million); former hockey player Mario

Lemieux ($890,000).

1998

Sued by Cleveland bank for writing a $100,000 check that bounced.

1999

While awaiting sentencing in the Islanders' case, Spano's bail is revoked

when he's charged and pleads guilty to writing bad checks and using invalid

credit cards to pay $7,700 a month for apartment and penthouse in

Philadelphia's ritzy Rittenhouse Square area.

2004

Spano's released from jail in June. While still on probation, he set up a

firm that investigators now say he used to scam more than a dozen companies.

2005

Yesterday, federal officials arrested Spano and arraigned him on new fraud

charges.

- Stacey Altherr

You also may be interested in: