News and Press Releases

Used Money from Investors to Fund Elite Youth Hockey Team and Pay His Own Living Expenses

December 7, 2006

GERALD SHERMAN, 55, of Mercer Island, Washington was convicted today in U.S. District Court in Seattle following a six day jury trial. SHERMAN was convicted of fifteen counts of Wire Fraud, four counts of Securities Fraud and two counts of Mail Fraud. The jury deliberated for about eight hours before finding SHERMAN guilty on all counts in the indictment. Some had dubbed the case “Hockey Dad” because of SHERMAN’s involvement in youth hockey.

SHERMAN was indicted on May 4, 2005. A superceding indictment in October 2006, charged SHERMAN defrauded various investors of more than $1.2 million with various promises to pay an extraordinary rate of return. The money was used to support an elite youth hockey program as well as to pay for SHERMAN’s living expenses. Testimony at trial revealed that SHERMAN had told investors they were investing in Indonesian gold that SHERMAN planned to resell at a huge profit in Europe. No gold was ever purchased. SHERMAN also took investor money to trade in “medium term notes” in an “elite market.” SHERMAN testified that he was never able to consummate a single transaction but added that he was continuing to work on the transactions on behalf of investors and believed in good faith that eventually he would be successful.

SHERMAN will be sentenced by U.S. District Judge John C. Coughenour on April 6, 2007. SHERMAN remains out of custody on home electronic monitoring until sentencing.

Securities Fraud is punishable by up to ten years in prison and a $1 million fine. Mail and Wire Fraud are punishable by up to five years in prison and a $250,000 fine.

The case was investigated by Washington State Department of Financial Institutions, the United States Postal Inspection Service (USPIS) and the FBI.

The case was prosecuted by Assistant United States Attorneys J. Tate London and Mark Parrent.

For additional information please contact Emily Langlie, Public Affairs Officer for the United States Attorney’s Office, at (206) 553-4110.

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