Cornerstone’s CEO has 1st day in court
A preliminary hearing in the federal case against Aspenite and former Cornerstone Investments CEO Michael R. Wise will take place March 2.
Wise and attorney Gary Lozow appeared before a federal magistrate in Denver’s U.S. District Court yesterday to answer a criminal complaint alleging wire fraud and theft. Wise admitted last fall he bilked some $6 million from Cornerstone clients.
U.S. Magistrate Judge Patricia A. Coan granted Wise liberty on a personal recognizance bond.
“Mr. Wise was summoned before the court based upon a complaint, and the process is such that when you are charged in this fashion, you have a right to a preliminary hearing within 20 days,” said Lozow, a Denver-based attorney. “That’s the touchstone of what happened [Wednesday].”
In the March 2 preliminary hearing, evidence against Wise will be presented to the court by federal prosecutors. The court must then decide whether there is sufficient evidence to warrant further proceedings against Wise. If so, the court will pass the evidence onto a federal grand jury, which after examination of the evidence, would choose whether or not to indict Wise.
Assistant U.S. district attorney and lead prosecutor, Thomas O’Rourke, did not return a phone call Wednesday afternoon.
“Mr. Wise has been cooperating with law enforcement agencies in the case,” Lozow said. “Mr. Wise is doing what he can to rectify what has happened, and the evidence will show that Mr. Wise has turned over to the [court appointed] receiver everything [in assets] that he has.”
Wise is the former president and CEO of the Aspen-based Cornerstone Private Capital, LLC. In a written statement dated Sept. 29, 1998, he admitted to diverting approximately $6 million toward his own personal and business expenses. He said that the money had been entrusted to him by investors to finance Cornerstone’s short-term, high-interest loans.
Wise is also the former CEO and chairman of the failed Silverado Banking savings and loan. Lozow represented Wise when he faced federal bank fraud charges stemming from the 1988 collapse of the $2 billion thrift. Wise was acquitted on all charges, but federal thrift regulators banned him from the banking industry for life.
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