An Idaho retirement fund trustee accused of raiding those accounts three years ago to help his failed bid to acquire Tamarack Resort insists he acted responsibly and with the ultimate goal of delivering significant investment return to the funds.
Defense lawyers for Matthew Hutcheson rested their case April 11, clearing the way for the federal jury to begin deliberations as early as April 15.
Hutcheson, an independent fiduciary, faces 17 counts of wire fraud for allegedly taking $5 million from two retirement accounts he oversaw to buy luxury vehicles, remodel his house in Eagle and buy the mortgage on the golf course at the resort, which now in foreclosure.
Hutcheson has defended using the money on personal expenses as the cost of impressing and luring wealthy investment partners in his plan to acquire the resort. On the stand April 11, Hutcheson said taking over the note on the golf course served two key elements in his plan: It gave him leverage to buy the rest of the resort at a bargain price and also met criteria for using retirement account money to achieve significant return on the investment.
Hutcheson, who initially proposed buying the ski resort for $40 million, said he never set out to cause harm to the hundreds of retirement account contributors who entrusted him to manage their savings.
“I believed I was behaving responsibly,” Hutcheson said under questioning from his attorney. “I wanted to help the participants make a great return … protect their principal.”
But federal prosecutors see Hutcheson’s actions in a different light.
Assistant U.S. Attorney Ray Patricco tried to show April 11 that Hutcheson purposely tried to conceal his decisions and role in trying to buy Tamarack from his business colleagues affiliated with the retirement funds.
Patricco wrapped up his questioning of Hutcheson by taking the jury back to early July 2010. During a span of four days, Patricco cited records showing Hutcheson authorized the transfer of $130,000 out of one of the retirement accounts, then putting some of the money into personal accounts and sending another $50,000 to the contractor building an addition and horse barn at his home.
Days later, Patricco pointed out how Hutcheson delivered testimony to a U.S. Congressional panel on the importance of transparency among those overseeing the nation’s various retirement savings and investments.
“Did you believe when you were wiring these funds to personal bank accounts days before you testified in front of Congress about transparency and protecting your plan participants … did you believe that passed the fiduciary smell test?” Patricco asked.
Hutcheson didn’t immediately answer the question directly, saying instead the hearing was about hedge funds rather than the role of an independent fiduciary.
Then he replied: “I have never intended to defraud them, ever,” Hutcheson told the jury.
The trial was due to resume April 15 when attorneys were to deliver closing statements before the judge hands the case over to the jury.
If convicted, Hutcheson faces up to 20 years in prison on each count of fraud.
Tamarack opened in 2004 to great fanfare and expectation, billing itself as the first new U.S. ski resort in a quarter century. President Bush visited the resort, located in the mountains 90 miles north of Boise, in August 2005 at a time when people were beginning to buy second homes surrounding the resort, golf course and the western shores of Lake Cascade.
But the resort’s French-born majority owner, Jean-Pierre Boespflug, in 2008 defaulted on loans and penalties now exceeding $300 million with a syndicate led by investment bank Credit Suisse. Hutcheson emerged on the scene in November 2010, announcing at a press conference in Boise his plans to buy the resort for $40 million.
But Hutcheson and his partners were never able to raise the money, and his plans evaporated and months later he was indicted by a federal grand jury.