Noted Biotech Investor Steven Burrill Gets 30 Months in Prison
Noted biotech investor G. Steven Burrill will only spend 30 months in jail for his involvement in wire fraud and tax evasion. Burrill pleaded guilty to the charges last year and, at the time, faced up to 30 years in prison. Now, he will serve less than one-tenth of that amount.
Burrill’s sentence was first reported by The Wall Street Journal. Burrill was charged last year with 26 counts of wire fraud, one count of investment-adviser fraud, and one count of tax evasion in connection with an alleged scheme to siphon money from an investment fund. For the charges, he faced up to 30 years in prison and a fine of up to $750,000. Those charges came more than a year after Burrill paid nearly $6 million in fines and penalties to the U.S. Securities and Exchange Commission over charges he stole money from a fund he managed for personal use. When Burrill settled with the SEC he agreed to a permanent ban from the securities industry.
According to the initial complaints Burrill was alleged to have stolen approximately $17.6 million over a five year period ending in 2013. As BioSpace reported last year when Burrill was charged, he had convinced investors to contribute their funds to the Burrill Life Sciences Capital Fund III L.P., a fund he managed that was valued at about $283 million. Burrill, according to the charges, then transferred millions of dollars in management fees for the fund to companies that he controlled. In its claims against Burrill, the government said the noted investor filed false income tax returns “which understated his income by excluding money Burrill transferred out of the Fund and into accounts he controlled.” Burrill was charged with then taking the funds and using them for his personal interests. The government said he used the investor money for lavish vacations, gifts, jewelry and expensive travel accommodations. On at least two instances Burrill delayed distribution of payments owed to fund investors so money could instead be used to continue paying for his personal expenses, the SEC said last year.
For Burrill, it was a massive fall from grace. The biotech investor had been advising and funding biotech companies since the founding of Genentech (RHHBY). Over the course of his career, Burrill raised more than $1 billion for the biotech industries. He spent 28 years at accounting firm Ernst & Young. Burrill first established his investment fund in 2005. It was focused on investing in drug and diagnostics companies.
Burrill will report to the authorities in March for his prison sentence.