Former Georgia football coach Jim Donnan’s fate is in the hands of 12 jurors.
After the defense rested its case and both sides presented closing arguments, Donnan’s fraud trial in federal court went to the jury of seven women and five men Wednesday afternoon.
The jury deliberated for about 3 1/2 hours before calling it a day. Deliberations are to resume at 9 a.m. Thursday.
The jury is to decide whether Donnan is guilty or not guilty on 41 criminal counts of conspiracy, mail fraud, wire fraud and money laundering, all related to an alleged scheme in which investors in a West Virginia-based company called GLC Limited lost almost $23 million.
Donnan, 69, could face a lengthy prison sentence if convicted.
Assistant U.S. Attorney Pete Peterman, in the government’s closing argument, said GLC was a Ponzi scheme that collapsed when Donnan “ran out of people to get money from.”
“It is very obvious Jim Donnan is not the victim he wants you to believe,” Peterman said. “His defense is a house of cards, as was the investment scheme.”
Jerry Froelich, one of Donnan’s attorneys, stressed in his argument that many “captains of industry” chose to invest in GLC. Froelich maintained that if sophisticated business people thought GLC was a sound investment, it’s understandable that “a football coach” would think the same.
Donnan “had a good name,” Froelich told the jury. “Give him back his good name.”
GLC investors recruited by Donnan testified that they were promised large rates of return — typically 30 to 70 percent — for investments that were to have been used to purchase closeout merchandise for re-sale to pre-determined buyers. But prosecutors contend that relatively little merchandise was sold by GLC and that early investors were paid from the contributions of later investors.
GLC, which stood for Global Liquidation Center, filed for bankruptcy protection in 2011, as did Donnan.
The central issue in the case is how much Donnan, who got involved with GLC in 2007, knew about the company’s operation and when he knew it.
GLC was founded by Greg Crabtree, a West Virginia man who was indicted along with Donnan. Crabtree avoided trial by pleading guilty to one count of conspiracy to commit fraud in the sale of a security. He faces up to five years in prison when sentenced next month.
Donnan’s lawyers, Froelich and Ed Tolley, said the former coach believed Crabtree was running a legal business.
“Whether Crabtree was running this as a legitimate business and lost control of it, or whether Crabtree was just a crook from the beginning, maybe it doesn’t matter,” Tolley told the jury. “Because for those on the outside, like Jim Donnan and (others), it looked completely legitimate.”
Countered Assistant U.S. Attorney Paul McCommon: “He calls Greg Crabtree a crook. Maybe so. But there’s no evidence Greg Crabtree was a crook before he got tangled up with Mr. Donnan.”
McCommon added later: “Mr. Crabtree and Mr. Donnan were partners at the start of this. They were partners as they executed this scheme. And they deserve to be partners at the end.”
Tolley told the jury that Donnan, Georgia’s coach from 1996 through 2000, “probably had one of the greatest football minds that ever came through Athens, Ga.,” but didn’t have a mind for business.
“It is not a crime to be not very smart,” Tolley said.
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