Archived Story

Donnan tells judge he won’t testify in own defense

Published 1:26am Wednesday, May 14, 2014

ATHENS, Ga. (AP) — Former University of Georgia football coach Jim Donnan, who’s accused of operating a fraudulent investment scheme, told a judge Tuesday that he will not testify in his federal trial.

Closing arguments in the case are set for Wednesday and then the jury will begin deliberations. The prosecution called dozens of witnesses, many of them investors, over four and a half days and rested its case Tuesday. Defense attorneys called a handful of witnesses and told the judge they would have one more Wednesday morning.

A federal indictment against Donnan and Gregory Crabtree, of Proctorville, Ohio, says the pair ran the scheme from September 2007 to December 2010 through West Virginia-based GLC, which dealt in wholesale and closeout merchandise. Prosecutors say the company raised more than $80 million from 94 investors, and nearly $23 million was lost.

Crabtree pleaded guilty last month to a single charge of conspiracy and faces up to five years in prison. Donnan, 69, faces charges including conspiracy, mail fraud and wire fraud, and could receive a lengthy prison sentence if convicted.

Prosecutors have said Crabtree ran the day-to-day operations of the scheme and Donnan used relationships of trust within his extensive network of personal and professional contacts to lure investors.

To demonstrate that point, their witnesses included business leaders, former football players and high-profile college coaches.

Most of the 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. And almost all of them lost money.

The prosecution has argued 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 have said.

Donnan’s attorneys have said he thought he’d found a good investment and wanted to share his good fortune with others. Defense attorneys on Tuesday called Donnan’s son, Todd Donnan, who invested on his own and also in partnership with a friend. Defense attorney Ed Tolley asked Todd Donnan whether his father was “fired up” about the GLC investment opportunity.

“I think that’s an understatement,” Todd Donnan replied.

Todd Donnan was not the only one of the former coach’s relatives who invested in GLC, and defense attorneys have highlighted the fact that Donnan and his family members were investors to underline their assertion that he believed it was legitimate.

“I know that my dad loves me and my children more than anything in the world and would never put us in harm’s way,” Todd Donnan said.

 

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