Hollywood TV producer and founder of Team Communications, Drew Levin, has just been sentenced to 66 months in federal prison and $2.2 million restitution after a multimillion-dollar scam to inflate his NASDAQ-traded company’s revenue and stock price.
In September 2011, Levin pleaded guilty to federal charges of stock fraud and bilking a French investor into a separate Levin-owned company in 2008.
Before Levin created a scheme to falsely overstate Team’s revenues to make the company appear to be profitable when it was actually losing money, Levin’s producer credits reportedly included “Future Quest” for PBS, “The World’s Most Mysterious Places” for Discovery and “Stephen King’s World of Horror” for MTV.
Today, the U.S. Attorney’s Office in LA made Levin’s sentence official, stating in a press release: “Drew Savitch Levin, 59, of Pacific Palisades, was sentenced by United States District Judge Dean D. Pregerson, who also ordered Levin to pay $2,272,588 in restitution to 13 victims in the United States, France, Austria, England and Switzerland.”
Levin’s illegal shenanigans were discussed in depth in the release:
According to court documents, Team, whose shares were traded on the NASDAQ stock exchange, was in the business of producing and distributing television programming, including made-for-television movies. As part of its distribution business, Team licensed its programming to other companies for distribution fees. Levin perpetrated a scheme to falsely overstate Team’s revenues to make the company appear to be profitable, when in fact it was operating at a substantial loss. For example, when Team licensed television programming for inflated distribution fees and the customers were unable to pay the fees, Levin had Team send them millions of dollars of Team’s own money, which the customers then used to make payments to Team. These “circular payments” were disguised by routing them through third parties and by ostensibly using them to buy television programming.
Levin personally profited from the revenue-inflation scheme in several ways, including by taking a $335,000 bonus based on Team’s reportedly profitable 1999 performance, and by pledging more than 500,000 shares of Team as collateral for a loan to buy a $1.5 million luxury vacation home in Big Sky, Montana.
At the sentencing hearing, Judge Pregerson described statements submitted by Levin’s victims:
It is a picture of Mr. Levin being essentially completely out of control and using his charm and sizable intellect to lie to people and take their money, and continue to feed that engine of whatever it was that he thought he was going to be able to accomplish. And maybe in his mind he felt that it would all come out fine in the end, but it was a scorched earth strategy, and that’s clear. And when you read the letters about the promises that were made once notes were due…those are lies, clearly. And you see that time and time again.
To read the full release, click here.