LIHUE — A former Kapaa man convicted of operating a Ponzi scheme in the 1990s was sentenced to three years and eight months in prison on Thursday at U.S. Federal Court-District of Hawaii.
Peter Heckman, 63, was sentenced to the 44 months and U.S. District Court Judge Helen Gillmore ordered him to pay restitution totaling $1,626,180.15 to eight victims in the case. The largest-single victim loss totaled $965,000.
FBI Special Agent Tom Simon of the Honolulu FBI Press Office, said while the victims were invited to address the court at sentencing, none were present in the courtroom.
“Mr. Heckman didn’t only steal money from people of Kauai; he stole the opportunity for them to achieve swift justice in this matter by choosing to run and hide for five years in Bali,” Simon said. “We hope that today’s sentencing will give the victim’s in Kauai a sense of closure and allow them to rebuild their lives.”
The court recommended that Heckman serve his sentence at the federal detention facility in Rochester, Minn. It is a medical facility that would allow specialists from nearby Mayo Clinic to treat his heart condition.
The Federal Bureau of Prisons will make the final determination but does rely on the judge’s recommendation, Simon said. The selection will come down to prison population and available space.
Assistant United States Attorney Les Osborne prosecuted the case. He had the defendant held in federal detention without bond as the maximum possible penalty for wire fraud is 20 years in prison.
Federal Public Defender Peter Wolff represented Heckman in the case, where Heckman accepted a deal in May. Wolff said the court sentenced Heckman in the middle of a guideline range of 41 to 51 months.
“He has very severe medical problems and I urged court to impose a lesser sentence,” Wolff said.
Heckman was convicted of an aggravated felony and the government will pursue deportation proceedings to Germany upon his release. An immigration judge will decide on the matter and Heckman was ordered to cooperate fully with removal proceedings during his sentencing.
Known as Peter Heckmann when he lived on Ohu Road in Kapaa, he established Heckman Multimedia Productions in the C. Ahko professional building in 1997. He was convicted of promising investors large returns for buying into a local sound and video editing company that he said would contract the film and music industry while on Kauai.
The scheme paid early investors with funds from later ones, according to Simon. It collapsed in 2007, and by then Heckman’s victims on several islands included Kauai retirees.
Heckman fled to Indonesia prior to his arraignment and lived as a fugitive for six years. The FBI caught up with him operating a music studio in Bali in 2010.
The U.S. has an extradition treaty with Indonesia, however, as a German national this complicated the matter. The FBI went public with information on Heckman and posted online rewards in early 2013.
According to Wolff, an agreement was reached between Heckman, who was destitute, when he persuaded the FBI to allow him to fly to Hawaii with an escort on March 12, and self-surrender at Honolulu International Airport.