Ailing and broke, former Miami Beach concert promoter Jack Utsick was sentenced Tuesday to 18 years in prison for fleecing hundreds of millions of dollars from investors to produce tours of Michael Jackson and other superstars.
Utsick, 73, a one-time commercial pilot who built his entertainment empire on the investments of retired colleagues in the airline industry, pleaded guilty in June to a single count of mail fraud.
Utsick’s attorney, Eric Lisann, urged U.S. District Judge Cecilia Altonaga to give him far less punishment — six years — but she showed no sympathy after hearing testimony in Miami federal court from a few victims who lost their life savings. Assistant U.S. Attorney John Gonsoulin, who questioned the witnesses, pushed for the harsher sentence meted out by Altonaga.
The judge also ordered Utsick to pay $169 million lost by thousands of investors — a portion of which is expected to be recovered from his life insurance policy when he dies.
Extradited from Brazil in late 2014, Utsick has been held at the Federal Detention Center in downtown Miami.
Before his arrest on a nine-count wire fraud indictment, Utsick ran his concert promotion business from his twin condo units on South Beach, organizing tours for Elton John, the Rolling Stones and other marquee musicians in the United States and Europe.
But by 2006, huge debts started piling up — millions of dollars that Utsick owed to former colleagues in the airline industry who had invested in his business, Worldwide Entertainment, Gonsoulin said. The promoter grew so desperate that he invested their money in stock options trading, he said.
Utsick’s company was placed in receivership while the Securities and Exchange Commission pursued a lawsuit accusing him of fraud.
Initially, the SEC determined Utsick and two former partners were selling unregistered securities to finance concerts featuring bands that included Santana, the Pretenders and Aerosmith, according to court records.
Then, the agency discovered that Utsick actually lost money on most venues, though he had claimed to be earning millions of dollars each year. Utsick eventually used money from new investors to pay off old ones until the so-called Ponzi scheme collapsed.
In all, the concert promoter was accused of raising $254 million from about 3,000 investors over nearly a decade, said Gonsoulin, the prosecutor.
In his plea deal with the U.S. attorney’s office, however, Utsick pleaded guilty to one mail-fraud count of ripping off $540,000 from a Massachusetts investor.
Ustick’s only asset is an estimated $45 million life insurance policy, which has remained viable because his former company’s receiver has been paying the premiums. When he dies, the proceeds would go to his investment victims.
The receiver already sold off Ustick’s other major assets: equity stakes in the theatrical rights to the popular show, Dirty Dancing, and in a New Zealand arena, court records show.