LAFAYETTE — A former Lafayette stock broker was sentenced Tuesday to more than 10 years in federal prison for his role in defrauding his working-class clients and setting them up to lose more than $6 million, costing many of them their life savings.
U.S. District Judge Richard Haik handed 46-year-old Richard Buswell a 126-month prison term and ordered him to pay restitution of $6.4 million to his victims.
Haik also ordered Buswell to serve three years supervised release and imposed a fine of $125,000.
In December, Buswell faces sentencing on other charges for his role in selling synthetic marijuana through the Curious Goods chain of smoke shops. The recently tried criminal case snared Buswell along with several others, including noted Lafayette criminal defense attorney Daniel Stanford.
Buswell pleaded guilty to both the investment scheme and Curious Goods charges in July 2013. The sentence imposed Tuesday was for one count of wire fraud.
Prosecutors have said about 100 investors lost money in Buswell’s stock scheme, which involved the sale of warrants of a private Israeli company, Advanced Blast Protection. Buswell told investors that the company was about to become publicly traded and that a surge in stock prices would make everyone a lot of money. Advanced Blast Protection eventually declared bankruptcy.
Prosecutors claimed Buswell made $1.7 million in commissions by needlessly buying and selling warrants in a fraudulent process called churning. Buswell also admitted to falsifying his clients’ net worth to meet federal guidelines on entering high-risk trades.
“When the investments failed to produce a profit, clients lost more than $6 million,” U.S. Attorney Stephanie Finley said in a prepared statement. “(Buswell) spent, in some cases, his clients’ life savings, leaving them with nothing or in debt.”
Buswell, dressed in a pink prison jumpsuit, said greed overtook him. He apologized in the courtroom Tuesday and tried to explain his actions.
“I felt bulletproof, and I started behaving recklessly,” Buswell told Haik and some of his victims seated in court Tuesday. “… I thought I had discovered the holy grail of investments.”
Four victims who spoke Tuesday told Haik they didn’t believe Buswell’s apology was sincere or that the man had changed.
“There’s nothing but lies with this man,” said Andy Naquin, a Lafayette City-Parish councilman and investor who lost money. “He didn’t care. It was all about Richard.”
Stanton Bujard, a carpenter, said he worked 30 years in blistering heat and extreme cold to build up a nest egg for retirement and his children. His father’s death nine years ago, Bujard said, left him with a sizeable retirement account that’s now gone.
“It took me 30 years” to build up an account that is now a fraction of what it was, Bujard said.
“I will live the rest of my life knowing I have lost my financial security,” Bujard said.
Buswell was the second and last defendant to plead guilty in the scheme. In May, 55-year-old Herbert S. “Steve” Fouke, of Lafayette, was sentenced to 30 months in prison after pleading guilty to securities fraud, investment adviser fraud, wire fraud and mail fraud. Fouke and Buswell are each responsible for paying restitution.
After ordering Buswell to pay a $125,000 fine, Haik said any money Buswell repays would go first to the victims. But, Haik said, he doubted Buswell would ever be able to pay his half of the $6.4 million restitution. The judge said the only way Buswell could do it would be through criminal activity.
“I, like the others who spoke, did not believe a word you said,” Haik told Buswell before he was hauled back to jail. Haik said he would ask the Federal Bureau of Prisons to place Buswell in a cell somewhere in or near Louisiana.