Restitution on Hold for Victims of 'Asian tree' Biofuel Scam
A Superior Court judge in Connecticut granted a permanent injunction Wednesday blocking a Trumbull investment company owner, convicted of fleecing dozens of people in a phony biofuel scam, from making restitution to his victims until he first pays off a civil judgment worth $625,517.
Barry Diamond pleaded guilty in November with his partner Michael Khan, 62, of Milford, to multiple larceny counts.
As reported by CTpost.com By all accounts, Diamond had been a pillar of the community. He co-founded and was president of Trumbull’s Own Chamber of Commerce, served as president of the Trumbull Library Foundation and the local Rotary Club, and lectured at Trumbull High School and Housatonic Community College, sharing his business acumen with students.
But according to police, Diamond was a skilled con man who successfully conned more than a dozen people around the state out of their life savings by selling phony biofuel investments.
One of his scams lured investors into sinking their savings into a unique Asian tree touted as producing a substance to end the energy crisis. CTpost.com explains:
With Tree-Corp., Diamond claimed that a special type of tree grown in Thailand was being processed into biofuel that would alleviate the U.S. dependence on foreign oil.
Said the Milford investor who asked not be named: ‘We would meet in the town’s Plumb Building, where he had all these plaques on the wall, and he would talk about local business people he had helped. I got the idea he was part of Trumbull’s infrastructure.’
The man said Diamond showed him official-looking documents supposedly from the Thai government that granted him control over hundred of acres of these special trees that would be converted into biofuel. He also produced contracts that he said had been signed with various U.S. agencies to set up biofuel stations across the nation.
‘He told me that this was going to be the future of the country and he was giving me the opportunity to contribute to that future. He said it would save the world, but instead it was all smoke and mirrors,’ the man said.
A New Britain woman, fleeced out of more than $70,000, said Diamond used photographs and a glitzy Web site to convince her to invest.
‘He showed me a contract with the Thai government and claimed he had a deal with the state of Connecticut and Foxwoods to sell the biofuel,’ said the woman, who also asked not to be identified. ‘We met in the Chamber of Commerce office and he provided me with lots of references, and I was sold. I still don’t have a clue what he did with my money,’ she said.
According to the lawyer who successfully argued for the injunction:
Allowing Mr. Diamond to make restitution to the victims in the criminal case would, in affect, allow him to continue his illegal activities because in essence he would be taking money from one victim to pay others.
The two men are scheduled to be sentenced Friday to seven-year prison terms. Under a plea bargain, however, those terms could be significantly cut if Diamond comes up with nearly $900,000 in restitution.
More on the biofuel fraud case.