A defense lawyer for former WFAN-radio sports-talk star Craig Carton urged Manhattan federal court jurors during closing arguments Tuesday to acquit Carton of fraud charges in an alleged ticket-resale Ponzi scheme because he never intended to hurt anyone.
“He never intended to steal anyone’s money,” said the attorney, Robert Gottlieb. “He never thought it would cause any harm.”
Carton, 49, is accused of using misstatements to get investors to put more than $4 million into purchasing event tickets that would be resold at a profit in 2016 and 2017, and then diverting the money for personal expenses, gambling debts and paying off earlier investors.
Closing arguments on charges of conspiracy and securities and wire fraud followed Carton’s decision Tuesday morning not to testify. The jury was received instructions in the afternoon and began deliberating at 4:40 p.m. but didn’t reach a verdict.
In testimony at the six-day trial, an official from Carton’s biggest investor, the hedge fund Brigade Capital, testified its money was intended only for ticket purchases — including a purported deal to buy $2 million in tickets to 2017 Barbra Streisand and Metallica concerts at Nassau Coliseum.
Executives from the company that operates the Coliseum and Barclays Center testified that an agreement and emails from them that Carton provided to Brigade had been fabricated, and they said Carton also had a wire transfer from Brigade moved to his account.
Records and multicolored flow charts introduced at trial by prosecutors showed money from Brigade and other investors moving to casinos, a landscaper who worked on Carton’s house, earlier investors and Carton’s alleged co-conspirators.
Gottlieb admitted Carton lied repeatedly — “he should be ashamed of himself” — but attributed it to his client’s hyper personality and “anxiety” about making his business succeed, and insisted Carton was free to do what he wanted with investors’ money as long as his intentions were pure.
“Money is fungible,” Gottlieb said. “He was entitled to spend that money on whatever he wanted to spend it on as long as he fulfilled his obligations.”
Prosecutors disagreed, telling jurors the use of deceit to separate investors from their money on false pretenses was proof of Carton's guilt.
“When you lie to people to get them to give you their money, that’s a crime,” prosecutor Brendan Quigley said. “... When you doctor emails, fake agreements, that’s an intent to deceive.”
Gottlieb also told jurors that Brooklyn Sports and Entertainment, the arenas' operator, had cultivated Carton for years by giving him smaller deals to resell tickets — a claim Carton made before trial — and executives led him to believe the deals he pitched to Brigade would come to pass.
Gottlieb said CEO Brett Yormark and former chief of staff Fred Mangione misled jurors by downplaying those ties in testimony because they were embarrassed to admit giving a middleman a block of tickets to sell at higher prices to the public.
“It would sully Barclays' reputation,” he said.
Quigley said past deals and expectations were irrelevant to Carton’s behavior. “... No amount of honest belief that a deal will eventually make a profit for investors is not a defense to fraudulent representations,” he said.
U.S. District Judge Colleen McMahon has ruled that using misrepresentations to deprive investors of their right to make an informed investment decision is enough to show criminal intent.
Jury deliberations are scheduled to resume Wednesday.