Advertisement - Click to support our sponsors.

Former Center Art
execs get 5 years in
pension theft

By Debra Barayuga
Star-Bulletin

Two former Center Art Gallery executives were sentenced to five years and three months imprisonment for stealing $1.2 million from the company's employee pension benefit plans.

This is the second conviction for William Mett and Marvin Wiseman, who were found guilty in 1990 for various mail and wire-fraud charges for selling lithographs they claimed were original Salvador Dali works. The art fraud was exposed by Star-Bulletin writer Lee Catterall.

Attorneys for Mett and Wiseman yesterday indicated they would appeal the latest conviction.

Both had been allowed to remain free on bail. The court was to hear motions today by both defendants asking to be released on bail while their case is on appeal.

Mett and Wiseman underwent a nonjury retrial in March before visiting U.S. District Judge Edward Rafeedie. Rafeedie found the two men guilty of 12 counts each of conspiracy and embezzlement based on transcripts of their first trial in 1996.

In that trial, both were convicted and sentenced to 70 months imprisonment. But the 9th U.S. Circuit Court of Appeals reversed the conviction and ordered a new trial.

The government contended that Mett, president of Center Art Galleries and Wiseman, vice president, violated their fiduciary duties as trustees of the pension plans by withdrawing 42 checks between March 1990 and November 1991.

The defendants had argued that the withdrawals were loans and transferred to the business with the intention of repaying the money.

Dennis Riordan, attorney for Mett, had argued that the defendants' actions were consistent with keeping the business afloat and fulfilling their pension-plan obligations. The benefit plans had previously made loans to the company in 1986 and 1989 and those loans were repaid.

Arthur Wachtel, attorney for Wiseman, minimized his client's role at Center Art as a "figurehead trustee."

But Rafeedie said the money they put into the plan in 1990 became employee property and that they failed to provide evidence that their contribution could legitimately be treated as a loan repayment.

And while Wiseman minimized his role, he was present at most of the meetings where the "illegal transactions" were discussed and benefited from the withdrawals, Rafeedie said.

Mett and Wiseman did argue however that they owned $385,000 of the pension-fund assets and they couldn't embezzle an amount that they already owned. The court agreed and reduced the amount of loss to $1.2 million from $1.6 million.

The court also ordered Mett to pay a special assessment of $700 and Wiseman, $650, and both to serve three months of supervised release upon their release from prison.