A commercial real-estate developer living on Vero’s barrier island when he pleaded guilty in September 2017 to defrauding investors and lenders of nearly $65 million in Connecticut was released from prison five years early because of health issues that made him vulnerable to the coronavirus.
John DiMenna, 77, returned to Vero Beach in May, shortly after U.S. District Judge Victor Bolden ordered his “compassionate release” from a minimum-security federal prison in Massachusetts due to the pandemic.
In his order, Bolden reduced DiMenna’s 85-month prison term to time served, ending less than two years of incarceration and allowing him to begin three years of home confinement, which was the second phase of his original sentence in April 2018.
Bolden noted DiMenna’s advanced age, history of cancer, and struggles with high blood pressure, high cholesterol and hypertension – all factors that put him at greater risk of complications and death from COVID-19 – in his decision to send the prisoner home.
The judge also embraced DiMenna’s argument that the prison’s environment did not allow him to practice social distancing and avoid exposure to the virus, and that the facility’s hospital was not sufficiently equipped to treat him if he did get infected and became seriously ill.
Government prosecutors fought DiMenna’s efforts to get out of jail, questioning whether he would be safer outside the prison, citing the magnitude of his extensive real-estate investment and financing scam, and presenting statements from “numerous victims” who opposed his release.
“Being confined to a comfortable home, in the company of his family and friends, does not strike me as a very difficult punishment for Mr. DiMenna to endure,” one victim said, “and does not in any significant way repay his debt to society.”
DiMenna had purchased a home in Bermuda Club on the island in 2008 and became a permanent Vero Beach resident in 2015. He and his wife, Lynn, no longer own a home in Bermuda Club, but their current address could not be confirmed.
Reached by phone last week, DiMenna’s attorney, Kevin Thomas Duffy Jr. of Greenwich, Conn., declined to discuss the DiMennas living and financial circumstances, but he agreed to inform his client that Vero Beach 32963 wanted to interview him.
DiMenna responded with an email in which he stated he “will not be eligible to truly enter the community until I’m 80 years old,” adding that he has “taken responsibility for his offense and cooperated with authorities in order to mitigate the consequences” of his actions.
As for his current living arrangements, DiMenna wrote in an email: “I don’t see why that information is germane to an article regarding my release.”
In the meantime, Duffy said he filed a motion asking the judge to overturn DiMenna’s conviction on grounds of ineffectual representation of counsel. He didn’t elaborate, but the Stamford Advocate quoted the attorney as saying his client “was sentenced as if he had stolen the money, but in fact he took nothing. He may have put false information on loan documents, but he did not take anything.”
According to the U.S. Attorney’s Office, DiMenna, from 2010 to 2016, provided inaccurate information to existing investors to persuade them to not withdraw their money, and he gave false information about a project’s financial viability to prospective investors to induce them to invest.
He also provided lenders and appraisers with fraudulent financial data concerning various real-estate properties and other entities used to collateralize loans, utilizing overstated income figures, false bank statements and false tax returns.
DiMenna regularly doctored financial statements prepared by his own accounting manager to enhance the value of his projects, the U.S. Attorney’s Office said. Often, he forged the names of his business partners on documents to secure financing without their knowledge or consent.
Federal prosecutors say DiMenna’s scheme cost investors $28 million, while lenders lost $37 million.
