An Orange Beach man was sentenced last year to 12 months and one day in prison after admitting he used registration numbers for aircraft that didn’t belong to him to secure close to $3 million in bank loans to help his fledgling business.
According to court records, Mark J. Graubart, president of Aircraft Sales Corporation, pleaded guilty and was sentenced in October to three counts related to defrauding BMO Harris Bank out of $2,859,250 over two years, by pledging as collateral planes that neither he, nor his company, owned. According to court records, some of the planes Graubart used in the scheme had previously been destroyed in fatal crashes.
For the crime, Graubart received a year and a day in a minimum-security prison in Pensacola. He is also eligible for release in 10 months, because of good behavior, said his attorney Dennis Knizley.
Knizley said he was pleased with U.S. District Judge Kristi DuBose’s decision, which represented a “75 percent deviation” from the sentencing guidelines, which called for four years.
Knizley said his client had no criminal history and worked to “immediately start to pay restitution even before a court order, or judge told him to,” both of which were factors in the decision.
“This man has lived a life with no criminal history,” Knizley said.
Knizley said his client made a “terrible mistake of trying to keep his business afloat” during the economic downturn that hit the aircraft sales industry especially hard.
“He said he owned aircraft he didn’t,” Knizley said. “He made the wrong decision in doing that.”
Blake Lowe, an attorney in Gulf Shores and a friend of Graubart, commended DuBose on the decision.
“I don’t know Judge DuBose well,” he said. “I have to give her credit to be able to look at the particular situation and I really appreciate she took the time to consider everything. I think she should receive credit.”
Graubart will have to pay restitution to the bank in the amount of $2.42 million, which takes into account $80,000 he has already repaid. In addition, Graubart will forfeit $2.5 million. The bank is unlikely to be made fully whole since restitution would take decades for the 59-year-old Graubart to pay. It’s not clear how he would be financially capable of paying the forfeiture.
“It’s pretty steep,” Knizley said of the restitution and forfeiture. “In light of the fact he did wrong we accept it and understand it.”
U.S. Attorney Kenyon Brown’s office appealed the sentence, according to court records. Although, the Department of Justice decided not to pursue the case further, said Tommy Loftis, a spokesman for Brown’s office.
Loftis said government appeals are a “lengthy process.”
“The government has moved to dismiss the appeal,” Loftis said. “Who made that decision and why I can’t tell you because I don’t know.”
BMO Harris Bank doesn’t comment on matters before the courts, said spokesman Patrick O’Herlihy.
Lowe said he hasn’t visited his friend in prison yet because he didn’t want to take time away from Graubart’s girlfriend. He said Graubart has lost weight and has quit smoking since entering the facility.
Lowe said his friend is remorseful for what he did.
“I think he’s pretty torn up about it,” he said. “He’s more embarrassed than anything.”
Knizley said his client wants to get back to work upon release from prison and he believes Graubart could possibly find work again in the aircraft sales industry.
“He was an outstanding salesman and he knew his business,” Knizley said. “He’s got a talent for it.”