February 25, 2004

PRESS RELEASE

NORTHAMPTON INVESTMENT ADVISER SENTENCED
FOR DEFRAUDING CLIENTS OF OVER $1.2 MILLION

Springfield, MA... A former Northampton investment advisor was sentenced yesterday in federal court for defrauding clients of over $1.2 million.

United States Attorney Michael J. Sullivan; Kenneth W. Kaiser, Special Agent in Charge of the Federal Bureau of Investigation in New England; and Joseph A. Galasso, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation, announced that ROBERT C. SEARS, age 46, of Northampton, was sentenced by U.S. District Judge Michael A. Ponsor to 3 years and 1 month in prison, to be followed by 3 years of supervised release. SEARS was also ordered to pay $267,471 in restitution. SEARS pleaded guilty to wire fraud on September 10, 2003 and in a separate hearing on December 17, 2003, to willful failure to file tax returns.

At the earlier plea hearings, the prosecutor told the Court that, had the case proceeded to trial, the Government's evidence would have proven that beginning in February, 2000, SEARS, an unregistered investment adviser, misappropriated funds from several clients' brokerage accounts. SEARS accomplished his misappropriation by forging clients' signatures on Letters of Authorization directing Charles Schwab Co. to transfer client funds to his own corporation and forging client signatures on margin agreements to obtain unauthorized margin loans. In one instance, SEARS used such forged documents to take over $500,000 from a client.

SEARS transferred his clients' money to Last Minute Concessions Inc., a Massachusetts corporation of which he was president and co-owner. Last Minute used the fraudulently obtained money to buy a controlling interest in Cold Spring Golf Course Inc., a company developing a golf course near Belchertown, Massachusetts. Last Minute also used money from SEARS' clients to buy an interest in Cold Spring Development Inc., which was building a condominium project associated with the golf course.

SEARS received substantial income from investments and self-employment during the tax years 1998 and 1999 but never filed income tax returns for those years. SEARS failed to file an income tax return for the 2000 tax year as well.

The case was investigated by the Federal Bureau of Investigation in Springfield. It was prosecuted by Assistant U.S. Attorney Ariane D. Vuono in Sullivan's Springfield Office.

Press Contact: Samantha Martin, (617) 748-3139