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Character References Help Brandon Barber Elude 20-Year Sentence

5 min read

FORT SMITH — When Brandon Barber faced sentencing in federal court here last week, the once high-flying developer could have had the book thrown at him.

In July 2013, he made a deal to plead guilty to three of 27 original counts brought by a federal grand jury, but he still faced a possible sentence of nearly 20 years. After all, Barber, 38, had orchestrated financial schemes that caused more than $32 million in losses and was the organizer of crimes accomplished by sophisticated means of deception.

Even after he filed for bankruptcy in 2009, Barber had continued to deceive creditors and used a newly formed investment company to hide money so he could continue living the good life, gambling in Las Vegas casinos and buying more than $30,000 worth of furniture. After he moved to New York, leaving tens of millions in debt behind, Barber boasted on Twitter that he was a “Serial entrepreneur. Nine Lives.”

It crashed, of course. But when Barber faced U.S. District Judge P.K. Holmes in federal court last Tuesday, he still had some things going for him.

Holmes had received batches of character references written by Barber’s friends and colleagues, including some who told the court about how much money Barber had raised for charity.

Although repeated violations of the terms of his pretrial release meant he had spent the past 16 months in the Washington County jail, by last week all parties agreed that he had fully accepted responsibility for his crimes and had cooperated with prosecutors. Five former associates also have been convicted.

Prosecutors, therefore, didn’t object when Holmes sentenced Barber to 60 months in federal prison for money laundering and 65 months each for conspiracy to commit bank fraud and conspiracy to commit bankruptcy fraud. The sentences will be served concurrently, and Barber should receive credit for the 16 months he has spent in jail.

Barber must serve at least 85 percent of his sentence under federal truth-in-sentencing rules and then he will have three years of supervised probation. After his release from prison, Holmes ordered Barber not to receive loans from financial institutions, or even family and friends, without prior approval.

U.S. Attorney Conner Eldridge had originally requested Barber be sentenced according to guidelines that called for 235-293 months. Holmes said the range was inflated by the amount of losses incurred by Barber’s schemes, but Holmes said the dollar amount reflected the scope of Barber’s developments more than the seriousness of the crimes.

The prosecution and defense agreed that the loss he caused totaled $32.86 million. Judge Holmes said the dollar amount “overstated the seriousness of his behavior.”

The sophistication of the deception and the fact that Barber was the organizer of it also increased the sentencing severity, according to the federal guideline matrix. In Barber’s favor, the judge agreed, was his acceptance of responsibility and cooperation with the ensuing investigation.

When Barber’s lead lawyer, Asa Hutchinson III, requested further deduction for his cooperation, Holmes quickly killed that idea, saying he had already been “pretty generous.”

Holmes said it was important to impose a severe sentence to deter other developers who might be tempted to game the system.

None of Barber’s victims spoke in court, but Holmes said victim statements had been received during the pre-sentencing phase.

Barber, dressed in prison orange with his legs shackled at the ankles, apologized to his family and friends. He had wiped away tears when a former colleague testified on his behalf in court.

“Your honor, I come before you with a humble heart,” said Barber, sitting between Asa Hutchinson III and Asa Hutchinson, the Republican candidate for governor. “More than a half-decade ago, I made bad decisions based on my selfishness and pride. I failed those who loved and trusted me the most.”

Barber will have to pay restitution to his victims, but that amount will be calculated at a Jan. 5 hearing.

Barber, a developer who announced multimillion-dollar projects in the early- to mid-2000s, filed for bankruptcy in July 2009. Creditor Legacy National Bank of Springdale argued that Barber had systematically hidden assets before and during his bankruptcy and, in 2010, the court refused to discharge $30.6 million of his unsecured debts.

A criminal investigation and indictment followed, and Barber was arrested on March 20, 2013. He was initially released on house arrest but had his bond revoked in June 2013 for repeatedly violating the terms of his pretrial release.

Barber pleaded guilty to three charges after a little more than a month in the Washington County jail.

Holmes said he imposed a sentence less than the guideline range in part because he was unsure when Barber’s fraud began. Holmes said it appeared that Barber resorted to criminal acts after the real estate market in northwest Arkansas went “soft” in an effort to cover his losses, not obtain loans.

Eldridge disagreed, saying Barber obtained several loans through fraud.

“This is not a story of a developer who suffered from a decline in the real estate market,” Eldridge said. “If that had been solely the case, we would not be here. We are dealing with fraud.”

Holmes said that probably wouldn’t have changed his sentence anyway. “This was not a Ponzi scheme, not repetitive fraud,” the judge said.

The most moving testimony came from former Fayetteville resident Karon Reese, who had butted heads with Barber about his plans to build a 12-story hotel on Dickson Street. The two became unlikely friends, and Reese drove from New Orleans to testify for Barber.

“I felt he was a very responsible citizen,” said Reese, whose testimony brought Barber to tears. “He did great work. He dealt fairly and honestly with us. He did contribute to Fayetteville in a really important way.”

Asa Hutchinson III said Barber’s crimes were not self-serving, and he cited extenuating circumstances such as Barber’s crumbling marriage, autistic son and a problem with alcohol for which he had sought treatment.

“We submit his motivation was not to line his pockets but to keep paying creditors,” Hutchinson said. “That’s not a justification or an excuse. It doesn’t make anything he did correct.”

A severe sentence, Hutchinson said, would over-punish Barber, whose reputation has already been “destroyed,” and would punish his children.

“I can’t treat Mr. Barber any different than a drug dealer who loves his children as much as Mr. Barber does,” Holmes said. “I think Mr. Barber is clearly remorseful. He is a good person who made serious, serious mistakes.”

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