Former security industry investors reunited—in prison


Timothy McGinn and David L. Smith, former partners in the Albany, N.Y.-based brokerage firm of McGinn, Smith & Co., which conducted dealings in the alarm industry, will serve out their fraud sentences in the same penitentiary, according to a recent Albany Business Review report.

I wrote here in August about their sentencing, after the two were convicted earlier this year of fraud, conspiracy and tax evasion in a Ponzi-like scheme that caused investors to lose millions. A judge called 65-year-old McGinn “arrogant” and sentenced him to 15 years in prison. Smith, 68, convicted of fewer counts than McGinn, received a 10-year sentence.

Now, the Albany Business Review reports, the two are both in the same prison in Brooklyn, N.Y. Here’s more from the Oct. 17 article:

The federal Bureau of Prisons says both men are now at the Metropolitan Detention Center, in Brooklyn.

Prosecutors say as many as 900 investors lost money. …

Attorneys for McGinn and Smith originally believed the two would wind up in different prisons. Smith had requested to remain fairly close to his family, who live in Saratoga Springs.

Attorneys say that McGinn, meanwhile, needs special medical attention for his diabetes, and residual concerns resulting from a heart attack in 2010, months after the FBI and IRS and the Securities and Exchange Commission began probing the McGinn-Smith operations.

The two pleaded not guilty to the charges they faced, and maintained their innocence when testifying at trial. They are preparing an appeal, which may not be heard for several years.