Donnan, 69, faced charges including conspiracy, mail fraud, wire fraud and money laundering, but his lawyers said he was duped and thought he was sharing an opportunity with friends.
"Certainly, I was relieved," Donnan said shortly after the verdict. "It's been a very tough process from day one."
Defense attorney Ed Tolley said he was "very moved" by the verdict for Donnan, who's been his friend for more than 20 years. "I'm so grateful to the jury that they paid attention," Tolley said.
Prosecutors said Donnan and Gregory Crabtree of Proctorville, Ohio, ran a fraudulent investment scheme from September 2007 to December 2010 through GLC Limited, a West Virginia-based company dealing in wholesale and closeout merchandise. The pair promised high rates of return but paid investors with other investor money, according to the prosecution.
Donnan's attorneys maintained that he was also a victim in Crabtree's scheme and that he thought he'd found a great investment.
The jury foreman, Artis Ricks, said he believed Donnan was as much a victim as other investors.
"I just kept thinking day after day the government was going to pull out a smoking gun, and I just didn't see one," Ricks said Friday after the trial.
Prosecutors argued that Crabtree ran day-to-day operations and that Donnan used relationships within his extensive network of personal and professional contacts to lure investors.
Prosecution witnesses included business leaders, former football players and high-profile college coaches who invested — including North Carolina State University basketball coach Mark Gottfried, Texas State football coach Dennis Franchione, Cincinnati football coach and former Texas Tech coach Tommy Tuberville, and former Texas Tech men's basketball coach Billy Gillispie.
Most investors testified that their trust in Donnan and his assurances that they wouldn't lose their initial investment money played heavily in their decisions to invest. Many received high payouts initially, prompting them to turn around and invest more money. Almost all lost money.
The prosecution argued that Donnan falsely told investors that they were putting their money in "presold deals" — merchandise they would purchase for which Crabtree already had a committed buyer — when in fact they were buying merchandise and then looking to sell it. But the company wasn't generating enough profits and money from new investors was continually needed to pay the company's expenses and other investors, prosecutors said.
Crabtree pleaded guilty last month to a single conspiracy charge and faces up to five years in prison.
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