June 27, 2018 / 9:46 PM / 3 months ago

Film producer sentenced to prison for U.S. investment fraud

NEW YORK (Reuters) - A California movie producer who headed a boutique merchant bank was sentenced to eight years in prison on Wednesday, following his conviction for defrauding investors out of $26 million.

David Bergstein, who was executive producer of the 2015 film “In the Heart of the Sea,” was sentenced by U.S. District Judge Kevin Castel in Manhattan, federal prosecutors announced. He had been found guilty of fraud charges by a jury in March.

Lawyers for Bergstein, 55, did not respond to a request for comment on Wednesday.

Bergstein, a resident of Hidden Hills, a Los Angeles suburb, was arrested in 2016 while he was the chief executive of merchant banking firm Cyrano Group Inc. He was indicted in November 2016 along with Keith Wellner, the former general counsel of Weston Capital Asset Management, who later pleaded guilty and cooperated with prosecutors.

According to prosecutors, Bergstein and Wellner from 2011 to 2012 engaged in a scheme to conceal information from Weston investors about transactions involving their money, and took funds from one pool of Weston investors to make payments to another.

Prosecutors said they also misappropriated some investor funds for their own and others’ benefit. Manhattan U.S. Attorney Geoffrey Berman in a statement said the fraud cost investors more than $26 million.

Bergstein previously controlled several movie production companies including ThinkFilm and Capitol Films Development. He took an advisory role in Walt Disney Co’s 2010 sale of Miramax to an investor group that included a business partner.

His movie credits include serving as an executive producer of 2004’s “The Whole Ten Yards” and 2007’s “Before the Devil Knows You’re Dead.”

In 2010, five of Bergstein’s film companies, including Capitol Films and ThinkFilm, were forced into bankruptcy at the urging of a group of creditors, court records showed.

Reporting by Brendan Pierson in New York; Editing by Leslie Adler

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