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It’s been a long and nasty fight, but the U.S. government is now one step closer to getting at least some of the millions it claims Paul Bilzerian owes the government. On Aug. 21, U.S. District Judge Stanley S. Harris held Bilzerian in civil contempt for failing to comply with a 1993 court order to disgorge $62 million — $33 million he had earned through securities fraud, plus $29 million in accrued interest. If Bilzerian does not give the government a full accounting of all his assets by Oct. 2, “he shall be incarcerated until such time as he complies,” Judge Harris said in his 32-page ruling. Securities and Exchange Commission v. Paul Bilzerian, No. 89-1854 SSH. The Bilzerian case is one of the more notorious on the books at the SEC, mentioned in the same breath as that of the decades-long fight against fugitive Robert Vesco. Bilzerian was one of the corporate raiders from the 1980s who made headlines with mega-million-dollar takeover bids until he was convicted in 1989 of securities fraud and conspiracy in connection with failed takeover attempts. He spent 13 months in prison, and his efforts to block the SEC from recovering the ill-gotten millions have been in and out of federal courts for a decade. In May 1999, the SEC asked Judge Harris, in Washington D.C., to force Bilzerian to cooperate with the government. The judge concluded that Bilzerian had made “patently absurd” arguments in trying to conceal his extensive assets in a maze of family trusts and holding companies, including a 30,000-plus-square-foot mansion in Tampa, Fla., worth $3.5 million, and stock worth $10 million. All told, the judge wrote, Bilzerian has tried to conceal assets in a family trust that are worth about $15.2 million — at least half of which he should be able to pay now. Judith Starr, assistant chief litigation counsel at the SEC’s Enforcement Division, said the defendant has a choice. “The keys to any hypothetical prison cell are in his hands, meaning all he has to do is comply,” Starr said. She added that if he made “full and frank disclosure,” the SEC would consider settling the case. Bilzerian, who is president of Cimetrix Inc. and spends part of his time in Utah, where the software products company is based, and part of his time at his Tampa home, said in an interview that he thinks Harris’ order is illegal. “I believe federal law prohibits a court from imprisoning someone for not paying a money judgment; effectively, the U.S. has done away with debtor’s prison,” he said. Plus, he added, the SEC’s efforts to disgorge his money is a violation of the Constitution’s protection against double jeopardy. He said that he already has been punished by a prison term and fine. He said that he does not know whether he will comply with the Oct. 2 order.

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