Tom Petters, the Minnesota businessman convicted of running a $3.65-billion Ponzi scheme, returned to federal court in St. Paul on Wednesday in an attempt to get his 50-year sentence cut to 30 years.
Petters, 56, testified in the same courtroom where he was convicted on Dec. 2, 2009 on 20 counts of fraud, conspiracy and money laundering. During Wednesday morning's evidentiary hearing, Petters finally admitted guilt.
"I was scared. I made horrible mistake," Petters said. "We were robbing Peter to pay Paul."
At times, Petters reluctantly admitted he was the mastermind of the plan, telling the court he lied during his trial because he was scared to death.
Under a searing cross-examination by U.S. Attorney John Marti, Petters was repeatedly asked if he deceived investors. After a 10-second pause, he quietly said yes. Afterward, Marti shot back, saying, 'You're scared now. You'll say anything."
Video: Petters hedges on the stand
Petters' last-ditch appeal alleges "ineffective assistance of counsel." He argued there was a 30-year plea bargain on the table that he was never made aware of, one he says he would have taken.
By Petters' telling, he only found out about the plea deal prosecutors had offered minutes after his conviction while he was sitting in a holding cell at the federal courthouse.
On the stand Wednesday, Petters' former defense attorney, Jon Hopeman, said those allegations are not true, claiming a 30-year-deal was offered on several occasions. He contends Petters thought the offer was "ridiculous" at the time.
Hopeman testified that Petters wouldn't settle for less than 15, and he wanted to "piss off the prosecutors."
A young attorney who took on Petters' appeal argued that Petters misunderstood Hopeman. Instead of contending that he never presented the plea deal to her client, she contends that Hopeman told Petters he couldn't recommend it.
Petters has been serving his time at the federal penitentiary in Leavenworth, Kan. If the 50-year sentence stands, he will be eligible for release in 38 years, with credit for time served and good behavior.