2 get jail terms in investment scheme

March 09, 1994|By Mike Farabaugh | Mike Farabaugh,Sun Staff Writer

Two Harford County men convicted of unlawfully spending more than $371,000 of investors' money between 1985 and 1988 were sentenced in Circuit Court yesterday to short jail terms and ordered to pay restitution.

Judge Stephen M. Waldron tailored the sentences of Joseph J. Owsik, 57, of Joppa and Leo D. Coughlin Jr., 60, of Edgewood, using health and occupational factors.

Owsik has a bone disease and uses a walker. All but 18 months of his five-year sentence was suspended, and he was ordered to serve the term in a Division of Correction institution, rather than at the Harford Detention Center, which lacks the medical services Owsik will need.

Coughlin was given a five-year sentence with all but 10 months suspended. He was taken immediately to the Detention Center and will be eligible for work release on May 2.

Judge Waldron said he considered the number of victims, the substantial amount of money involved and levels of criminal responsibility for each defendant, but he said the nature of the crime -- a scheme and not a single act -- required a jail sentence.

Owsik and Coughlin also must serve five years' supervised probation.

Judge Waldron said it would be fantasy to expect that either would ever be able to complete the restitution of $371,235, but he said a payment schedule would be worked out for both defendants by the Division of Parole and Probation.

Prosecutor Norman L. Smith, an assistant attorney general, said Owsik and Coughlin were president and vice president, respectively, of Valco International Inc. They collected more than $500,000 from investors to develop and market a device to prevent drunken drivers from starting a car.

Drunkguard, as the device was called, never was manufactured by Valco, which was based in Aberdeen.

Judge Waldron said Owsik spent large sums on luxury items, such as several Cadillacs, and had made a deposit on a waterfront property.

Owsik also used Valco funds to pay for his son's Little League baseball team to travel to Florida.

Mary Hammond, a forensic accountant who assisted prosecutors in the yearlong investigation, said that more than 200 investors can hope to receive 72 percent of their money back, if restitution is ever completed.

The defendants are jointly and separately responsible, Mr. Smith said.

Owsik is on a disability pension and said his wife, Katherine, has been in a coma since Jan. 25. He said that because of her condition he has delayed surgery for himself.

Coughlin is a copy editor for The Aegis, a Harford County weekly newspaper owned by The Baltimore Sun.

He worked at The Sun as assistant foreign editor and, in 1975, became foreign editor. He was editor of the Sunday Perspective section for four years before resigning in 1983.

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