Lake Geneva contractor convicted in scam agrees to $400,000 in restitution
ELKHORN—A Walworth County contractor convicted of scamming a client out of $1 million has agreed to pay $400,000 in restitution.
An agreement between the prosecution and David Pierce was reached just before a restitution hearing Monday.
A jury in February found Pierce, 43, guilty of five felony counts of theft by fraud and one felony count of theft by contractor.
Pierce scammed a Chicago husband and wife out of about $1 million while working on a multimillion dollar home improvement project in the town of Linn, prosecutor Diane Donohoo said during the trial.
Pierce over-billed his clients, did not pay at least five subcontractors in full and left the project 70 percent finished before fleeing to Costa Rica, the wife said during the sentencing.
Reserve Judge Stephen Simanek sentenced Pierce in May to nine years in prison and 21 years of extended supervision.
Simanek also ordered Pierce to pay $1.95 million in restitution to reflect money lost, time, emotional damages and attorney fees for civil cases that resulted from Pierce telling subcontractors the client never paid him to pay them.
The $400,000 in restitution will be paid to the couple to cover the cost of an accountant the client hired to investigate the amount of money stolen and to cover the amount the client paid five subcontractors a second time after the client thought Pierce already paid the subcontractors, Donohoo said.
The case is complex and the final dollar figure is “nothing more than a compromise” based on testimony at trial and accounting fees presented, defense attorney Brad Lochowicz said.
As part of the agreement, Pierce will not contest his ability to pay the restitution, Lochowicz said.
The Chicago couple approved of the settlement, Donohoo said.
The trial transcript did not have all the information needed to prove the $1.95 million restitution claim but could have proven a larger amount than $400,000. Donohoo said.
However, the wife, who worked the closest with Pierce, was concerned about spending more time and resources on a restitution hearing and possibly not receiving all the money requested, Donohoo said.
Pierce ran Pierce Builders in Lake Geneva when his company was hired in 2006 as the general contractor for the construction of the couple's home. The 18-month contract listed the estimated project cost at a little under $5 million. By 2008, the cost grew to $5.78 million.
The contract included a 10 percent profit for Pierce. Instead, he took 20 percent, resulting in at least $324,000 in additional charges to the client for material and work from the subcontractors, according court documents.
The amount stolen was closer to $1 million, including payments the couple made a second time after Pierce closed his company and fled to Costa Rica without paying the bills, according to statements made during the trial and sentencing.
Pierce used the client's money to cover business and personal bills, Donohoo said.