Two men were each sentenced Friday to four years and two months in prison for what Internal Revenue Service officials have called a staggering cheat of the tax system.

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A federal judge sentenced two Seattle businessmen to four years and two months in prison for devising and executing one of the largest tax-evasion scams in U.S. history, bilking the government out of nearly a quarter of a billion dollars in lost tax revenue in a single year.

Jeffrey Greenstein, 48, and Charles Wilk, 52, through Seattle hedge-fund company Quellos Group, recruited five super-wealthy clients for membership in a tax shelter called POINT in 2000. In the next year, using offshore companies in the Isle of Man, POINT generated $9.6 billion in fake investment losses for those clients, which were used to offset taxes they owed on their very real capital gains.

The result, said U.S. Attorney Jenny Durkan, was a “staggering” theft. The $240 million they stole, she said, would be enough to “buy a million schoolchildren a hot breakfast for a month.”

Just as staggering was Greenstein’s fall from grace.

Greenstein was among the brightest stars in the Seattle financial community, a University of Washington business-school graduate who founded and ran Quellos — which had a legitimate multibillion-dollar investment portfolio — before the company was sold in 2007 for $1 billion.

Moreover, according to documents filed in U.S. District Court in Seattle, Greenstein has been a quiet and dedicated philanthropist and humanitarian, a member of the Seattle Art Museum board of trustees, who donated huge sums of money and time to a variety of charities and causes.

Indeed, after ordering him to prison for 50 months, U.S. District Judge Ricardo Martinez told Greenstein: “You’re an extraordinary individual.” But Martinez also noted that Greenstein, who did not have a privileged upbringing, relied on scholarships and the help of a number of public institutions to get his education and make his fortune.

“You’ve stolen from the very society that provided you with the opportunity to acquire wealth and power and respect beyond most people’s wildest dreams,” the judge said.

The government had asked that Greenstein be sentenced to six years in prison for the counts of conspiracy and failing to file a tax return to which he and Wilk had pleaded guilty last September.

Seattle defense attorney Jeffery Robinson, in asking for a two-year sentence, urged the court to take the measure of Greenstein’s 30 years of philanthropy and community service.

Greenstein has paid $6.4 million to the government — his share of the POINT profits — and paid nearly $300,000 for his own prosecution, Robinson said.

The five unnamed clients were required to pay the $240 million back as well, with an additional $160 million in interest and penalties, according to Durkan and court documents. None was charged criminally.

Wilk was two years out of law school when Greenstein hired him. His lawyer, John Keker, of San Francisco, said he lacked experience and it “wasn’t always clear that Mr. Wilk knew what he was doing.”

“Chuck was talking fast and over his head at times,” Keker said. Wilk paid the government $600,000 he made through the POINT transactions.

“He has lost his pride,” Keker told the court. “Which I think in the past has been a little overwhelming at times.”

Martinez said Wilk’s position as an attorney gave him additional responsibilities.

“You were the one who was supposed to stand up and say, ‘This is criminal; this is fraud. We could go to prison,’ ” Martinez said. If nobody listened, the judge said, it was Wilk’s responsibility “to walk away.”

Aside from Greenstein and Wilk, the two-year investigation into Quellos resulted in the conviction of Hollywood tax attorney Matthew Krane, who pleaded guilty to tax evasion and who had agreed to testify against Greenstein and Wilk. Among Krane’s clients was Haim Saban, the producer of the popular “Mighty Morphin Power Rangers” cartoons — who has been identified as one of the POINT investors.

Seattle Times news researcher Miyoko Wolf contributed to this report, which includes information from Times archives.