Donald MacPherson and his wife, Carrie Coakley, leaving a Riverhead...

Donald MacPherson and his wife, Carrie Coakley, leaving a Riverhead courtroom. (April 18, 2011) Credit: Joseph D. Sullivan

The man behind the largest white-collar theft ever prosecuted in Suffolk County was sentenced to 4 to 12 years in prison Monday.

Donald MacPherson, 68, of Manhattan, pleaded guilty in November to 34 counts of grand larceny and numerous other felonies for bilking lenders out of more than $44 million in a massive mortgage fraud scheme.

Although some co-defendants got more notoriety -- including former county legislator George Guldi and Ethan Ellner, an old friend of former County Executive Steve Levy -- it was MacPherson who put the scheme together, said Assistant District Attorney Thalia Stavrides.

"That's a large chunk of change, your honor," Stavrides said to Suffolk County Court Judge James F.X. Doyle. "This defendant never worked a day for it. This is the defendant who created false employment for straw buyers, created false jobs at the Soho Journal," the newspaper MacPherson owned in lower Manhattan.

She noted that some of his co-defendants referred to MacPherson, the mastermind of the scheme, as the "Lord of Darkness."

His wife, Carrie Coakley, 40, also pleaded guilty last year and will serve community service and probation. She recruited straw buyers at The Dungeon, a SoHo club where she was the dominatrix in charge.

The mortgage fraud was so huge that it played a role in crippling the East End real estate market, Stavrides said. Prosecutors say the ring stole $82 million from lenders by inflating purchase prices, fabricating documents and using straw buyers to make phony purchases and obtain mortgages.

Defense attorney Steven Wilutis, of Miller Place, tried to delay the sentencing, noting that MacPherson is wearing a heart monitor after a dizzy spell and could need a pacemaker. Doyle said he could get medical attention in prison.

"Mr. MacPherson is very remorseful for what he's done," Wilutis said. "Mr. MacPherson is ashamed. He is embarrassed."

Wilutis said his client was aided by numerous others, including attorneys, in the commission of the crimes. Wilutis said the banks "are not with clean hands" and could have prevented the fraud if they hadn't been giving out loans so freely.

"This has been a dark period in my life," MacPherson said in court. "I took bad advice, and I acted on it."

Both Stavrides and Doyle rejected the idea that MacPherson was led astray by others.

"This is a major financial crime," Doyle said. "It cannot be tolerated. . . . You are a very capable man. You put a lot of effort into this." He also ordered MacPherson to pay restitution of $44 million to the lenders.

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