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A former Los Altos resident’s return to jail March 24 offered a behind-the-scenes look at delayed criminal prosecution over his shuttered investment business.
Mark Feathers saw his bail revoked after six individuals working with the U.S. Securities and Exchange Commission allegedly received threatening emails from him related to anticipated testimony in the upcoming trial.
In the brief emails, sent in early March, Feathers asked the officials to avoid using the word “Ponzi” or “swindler” during the trial and said that he would “rise out of my seat and attempt to bring injury to any party that uses the word.” He noted that use of the word “Ponzi” had introduced “prejudice” in previous court proceedings.
Throughout a civil trial regarding fraud at his Los Altos-based Small Business Capital Corp., Feathers maintained that the SEC incorrectly interpreted his investment funds’ business structure as a Ponzi scheme. U.S. District Judge Edward J. Davila was not convinced, consistently ruling in favor of the SEC’s interpretation that Feathers mishandled funds and misrepresented his funds’ practices and profitability.
An FBI agent investigating Feathers’ threatening emails reported that the text included the subject line “you will need to ask the court for extra marshals to my jury trial.” The agent, Christine White, described some of the recipients as feeling concerned for their safety and aware of how the threats related to testimony they were expected to provide as witnesses in the trial. Feathers’ combative back-and-forth with many of the officials assigned to his investigation had already included personal emails and confrontations, multitudinous court appeals, and attempts to initiate independent investigation of SEC practices.
Although the U.S. Department of Justice indicated years ago that it intended to prosecute Feathers for 29 felonies related to financial fraud, it delayed initiating that case while the SEC’s civil prosecution wended its way through the courts. After the SEC largely wrapped up its work last month and released reams of files to the DOJ, the criminal case could move forward.
Feathers’ bail was revoked and he was booked last month into the Santa Clara County Main Jail because the conditions of his pre-trial release required that he neither commit offenses nor harass or threaten witnesses. As of Monday, he was listed as ineligible for bail.
