Accused drugger of Olympic skater gets jail time for investment scam

A Southern California insurance salesman has been sentenced to 10 years in federal prison after pleading guilty in a scheme that swindled investors out of $50 million of dollars.
James Halstead was sentenced Wednesday in federal court in Santa Ana.
Mr. Halstead pleaded guilty in September to wire and mail fraud charges. U.S. District Judge David Carter dismissed a money laundering charge. The dismissal came at the request of prosecutors.
The judge also ordered Mr. Halstead to pay $14.5 million in restitution, the actual loss suffered by victims after factoring in how much money was returned to investors in the phony scheme.
Mr. Halstead convinced about 140 investors, mostly real estate developers and retirees, to invest in private investment in public equity, or PIPEs,. Essentially, PIPES are invested in high-interest bridge loans to companies finalizing long-term funding. Mr. Halstead told the investors the PIPEs would generate a 25% to 30% return over three to four months.
But he never invested their money. Instead, he spent the cash on personal items, including $353,000 on a Ferrari and Porsche, and $1 million on a house with a spectacular view of he Las Vegas strip.
This is not the first time Mr. Halstead has run into trouble with the law. In 1998, he pleaded guilty to give counts of fraud in a $1 million scheme sell crude oil and German bank shares. He received probation for that offense.
More famously, Mr. Halstead was charged in 2008 with drugging ice-skating star Oksana Grishuk.. The two-time Olympic gold medalist claimed the insurance broker put a pill in her wine glass in an attempt to sexually assault her when the two met at beach resort in Dana Point, California. Ultimately, the charges were dropped.
At his sentencing today, Mr. Halstead seemed contrite for the PIPE scam. “I made poor choices,” he said, according to the Los Angeles Times. “I did not do my due diligence. The money became an addiction. I took the free ride and the devil was waiting.”
Now, a jail cell is waiting.

[The Associated Press contributed to this story]

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