Promoter Gets 4 1/2 Years in Check-Kiting Scheme

A promoter of allegedly bogus businesses from eucalyptus plantations to European hamburger joints was sentenced Friday to 4 1/2 years in federal prison for defrauding a Los Angeles bank.

John C. Ellsworth, who once falsely testified that he had managed the Rolling Stones rock group for five years and bragged that he was building an Islamic theme park in San Bernardino, was ordered to serve an additional 4 1/2 years of probation and contribute 1,000 hours of community service for his role in a check-kiting scheme that cost Sanwa Bank California and three other California banks a total of $1.4 million.

According to Asst. U.S. Attorney Anita H. Dymant, Ellsworth wrote checks on various company and personal accounts that he knew to have insufficient funds. Ellsworth then gave the checks to his business associate, Peter Azer, who cashed them knowing there was no money to back them up. The two then split the proceeds, which amounted to $250,000 from Sanwa Bank.

Tried to Postpone Sentencing

At Friday’s hearing, Ellsworth’s attorney tried unsuccessfully to postpone sentencing, saying his client was under “heavy medication” for a stroke he suffered two months ago. But U.S. District Judge Manuel L. Real said there was no legal cause not to impose sentence.

The 42-year-old Ellsworth, who has been in custody since he was arrested Jan. 13, leaned on a cane as he prepared to hear his penalty.

He told the judge, “I am wholeheartedly sorry that this ever transpired. I may have been excessively misguided in my business deals and acumen. I can’t say anything more than ‘I’m sorry’.”

Separate Investigation

In all, Ellsworth was alleged to have written seven bad checks for deposit at Sanwa during the first three months of 1987. When Ellsworth pleaded guilty in February to cashing two of the checks, indictments on the others were dismissed.

Azer has pleaded guilty to four counts of bank fraud and is currently free on bail. He is scheduled to be sentenced Aug. 1 on charges that he bilked Sanwa and three other banks.

Ellsworth is the target of a separate criminal investigation by the U.S. Attorney’s office into the alleged misuse of $60 million in pension fund investments in Commercial Acceptance Corp., from which he borrowed money, Dymant said. In addition, the California Department of Corporations has filed a civil suit against Ellsworth.

Last September during the visit of Pope John Paul II to Los Angeles, Ellsworth gained further notoriety by claiming he was part of a papal welcoming committee and running up $20,000 in bad debts at area hotel and food establishments, according to testimony in bankruptcy court.