Terrance Cosgrove stole millions from his partners in a fishing company and at least $335,000 — maybe much more — from the widow and children of a friend, and at least $500,000 from trusts belonging to the family of another longtime friend.
Russell Moore spent nearly 30 years as a Northwest fisherman, investing every dime he had in the company he co-owned with businessman Terrance Cosgrove and three other partners.
Cosgrove, it turned out, bilked Moore out of most of his money. He also stole the life savings from the widow and children of his best friend, and raided the trust funds of the family of another close friend, according to a wire-fraud and mail-fraud plea agreement.
Moore stood before U.S. District Court Judge John Coughenour on Tuesday morning — with Cosgrove standing nearby — and described the theft that had ruined him.
“This was my retirement plan,” Moore said in a Seattle courtroom. “I didn’t get much,” he said, explaining the partners got less than $500,000 of the more than $4 million they had lost after Cosgrove declared bankruptcy.
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“I don’t feel so good about the whole situation,” he said.
Neither did Coughenour.
The judge ordered Cosgrove to prison for five years despite pleas from his defense attorney that the ailing 67-year-old businessman — who recently underwent a liver transplant and suffers from heart disease, diabetes and skin cancer — won’t survive incarceration.
Cosgrove’s attorney had sought probation, home confinement and community service.
Cosgrove, who has lived in Seattle, Mercer Island and Kirkland, currently has a rental home in Napa, California, said his attorney, assistant public defender Dennis Carroll, and needs the expertise of his health-care team there.
But Coughenour said the prison term was justified “by the abominable breach of trust that was involved in this case.” The judge gave Cosgrove three months to make arrangements and turn himself in to the U.S. Marshals.
Prosecutors had called Cosgrove a “seasoned financial predator” after bilking his victims out of millions
Assistant U.S. Attorney Francis Franze-Nakamura, who had sought a seven-year prison term, argued Tuesday that the losses “were not the result of poor business decisions or life stress.”
“These are actions of cruelty and greed,” he said, pointing out that Cosgrove had been trusted by his victims to watch over their money.
“He betrayed them, he cheated them, and he robbed them,” he said.
Cosgrovepleaded guilty in December to mail and wire fraud and agreed to pay $2.9 million in restitution and forfeit cash and property worth $3.9 million.
Prosecutors say he stole millions from his partners in the Bothell fishing company and at least $335,000 — maybe much more — from the widow and children of a friend, and at least $500,000 from trusts belonging to the family of another longtime friend.
The exact amount of money Cosgrove stole will likely never be known because he covered his tracks, prosecutors say. However, based on a pre-sentence investigation, the prosecutor’s filings and documents in a King County Superior Court civil case and bankruptcy documents, the amount could exceed $8 million.
In August, Cosgrove and his family began raising donations to help offset the costs of Cosgrove’s liver transplant on a “compassionate crowdfunding” website.
Cosgrove was a respected businessman and trusted by friends and his business partner for his acumen. He was named administrator of the trusts he later stole from for that reason, according to prosecutors.
All of the thefts occurred roughly between 2008 and 2013, court documents say.
The largest involved Cosgrove illegally siphoning cash, sometimes $100,000 at a time, through bogus management fees charged to the fishing company ISP Trading.
He stole more than $6.1 million from Moore and his other partners — some of whom he’d known for 25 years — although he paid some of it back after he was caught. For sentencing purposes, the loss was pegged at just over $3 million.
The second scheme wiped out a trust fund set up for the widow of Cosgrove’s best friend and her children.
When his friend died, Cosgrove agreed to administer the trust, but prosecutors said he ended up treating it “as his personal slush account.” He stole at least $335,000 from that account, according to the plea agreement, but the loss was likely much more.
The widow wound up losing her home to pay for taxes and avoid foreclosure, according to the plea agreement.
The third scheme involved theft from trusts belonging to the wife and two children of another longtime friend, which he raided for nearly $500,000, according to the plea agreement.