Theft of $1.5M meant for children’s hospitals nets 16-year sentence

Charity William Schwartz Arrest Photo

William Schwartz, 44, was convicted of two counts of felony theft by a jury in May. (Courtesy of the Denver District Attorney’s Office)

A man who stole $1.5 million from two Shriners groups, including money meant to cover life-saving medical flights for children, has been sentenced to 16 years in prison.

The punishment, unusually stiff for a white-collar crime here, followed a three-hour hearing Friday at which Judge Adam Espinosa heard about the life and crimes of William Schwartz.

“The money that you took — the average income in our community is $78,000,” Espinosa told the 44-year-old. “$1.5 million — many in our community won’t earn that in their lives.”

While he was treasurer of the El Jebel Shrine Association in Denver from 2014 to 2019, the Castle Rock man moved more than $1.2 million that had been earmarked for the fraternal organization and Shriners Hospitals for Children to bank accounts for his companies.

Then, in 2019, Schwartz became treasurer of the Order of Quetzalcoatl, a Masonic group that also sends money to Shriners hospitals. Schwartz stole more than $250,000 from it.

Schwartz was indicted in April 2022 and convicted by a jury in May of this year. Jurors found he had committed two counts of felony theft. At trial, Schwartz did not dispute the theft allegations but argued the charges had been filed too late, outside a statute of limitations.

“I don’t think ‘I’m sorry’ is ever going to be enough for any of the people that I hurt,” Schwartz told Espinosa through tears and sobs just before he was sentenced Friday.

“I cheated them,” he said. “I cheated the people that the money was intended to help.”

Schwartz’s wife and 14-year-old daughter did not attend the sentencing and only his psychiatrist testified on his behalf. As a result, both sides of the courtroom were filled with dozens of Shriners and their supporters, many of them wearing their maroon, tassled fezes.

Several Shriners testified passionately about their groups’ philanthropic work, which includes paying to airlift badly burned children in Central America to Shriners hospitals. They transport 200 patients a year at an average cost of $23,000 each, according to testimony.

“This is not a destitute man who was trying to feed his family. He is a sociopath who thinks he can take advantage of anything he wants to,” Order of Quetzalcoatl CEO Rick Corbin said of Schwartz. “…He needs to be locked up with the other wolves, to protect the innocents.”

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William Schwartz listens to Judge Adam Espinosa at his sentencing hearing on Aug. 18, 2023. (Justin Wingerter/BusinessDen)

Joe Kent, a leader in the local El Jebel Shrine, said that Schwartz has never apologized.

“His deeds were thought out and planned,” Kent testified. “He knew who he was stealing from and it didn’t bother him. It didn’t bother him at all, not one bit.”

Schwartz’s attorney, Richard Tegtmeier, emphasized that both groups Schwartz stole from were able to continue paying for the airlifts by drawing on their savings.

“Every child that El Jebel was asked to help take to a hospital was taken to a hospital,” the defense attorney said. “… No children were ever harmed here.” 

Dressed in a business-casual outfit of khakis and blue dress shirt unbuttoned at the collar, Schwartz sat with his hands folded by his mouth and his eyes straight ahead. His reddish face would wince when witnesses called him names or tarnished his character.

Gary Gutterman, a psychiatrist in Denver who began seeing Schwartz after he was indicted, testified that his patient had a “difficult and traumatic” childhood, followed by a neurological disorder as a young man and a bout of cancer in 2012. Gutterman repeatedly referred to Schwartz’s greed as “an intoxication” and “an addiction” that he couldn’t control.

“He said to me, ‘I got caught up in greed. I couldn’t put an end to it. It was intoxicating,’” Gutterman testified, referring to his therapy sessions with Schwartz.

“He said, ‘I repeatedly said to myself, I’m going to stop this, but like any addiction, I couldn’t stop,’” the psychiatrist added. When asked by Espinosa if he was saying greed is an addiction, Gutterman clarified that he meant Schwartz can continue to benefit from therapy.

Gutterman and Tegtmeier framed Schwartz’s crimes as an attempt to keep up with the “high lifestyles” of his Shriner friends, remarks that earned eyerolls in the courtroom gallery.

“The men that are Shriners — almost all of them have been successful in business. They are people that Bill looked up to, people who you can tell have a high degree of success in life and Bill wanted to have that,” Tegtmeier said. “He didn’t have that in his youth.”

Deputy District Attorney Katie Kirk said that at the time of his arrest, “Mr. Schwartz was living an extraordinarily privileged life” with the money he stole. She listed a nearly million-dollar house, vacation home in southern Colorado and timeshare in Hawaii, a $100,000 Lincoln, “$30,000 in plastic Legos bought as a business venture,” and $12,000 in custom suits.

“This case is a bit of an aberration because we haven’t seen victimization of a charitable organization on this scale since I have been at the DA’s Office,” said Kirk, who joined the office nine years ago.

Some Shriners asked Espinosa to sentence Schwartz to 24 years in prison, the maximum allowed under law. Kirk asked for prison time but did not specify how long of a stint she thought appropriate. Tegtmeier asked that his client be sentenced to probation, not prison.

“I know that we are all more than the worst thing that we’ve done but what you did here is significant. These are some of the most serious offenses in our system,” Espinosa told Schwartz, noting that one charge was a Class 2 felony, on par with some murders.

“Your motive really seemed to focus on promoting your lifestyle. You really struck me as somebody who wanted to get ahead but perhaps decided that rather than put the hard work in, you would cheat others,” the judge said. “This wasn’t a real estate scam or a pyramid scheme, it was many years of taking money from a group of people who were your friends.”

With that, he sentenced him to 16 years in prison for the theft from El Jebel and six years for the theft from Order of Quetzalcoatl, to run concurrently. Schwartz must also serve three years of probation and pay restitution. The amount of restitution will be decided at a later date.

“You’ll get out of prison much sooner than you think,” said Espinosa, noting defendants rarely serve a full sentence, “and I hope you can make good on your promise of restitution.”

As the judge made his remarks, three Denver sheriff’s deputies walked behind Schwartz and removed their handcuffs. He was arrested when the judge finished talking.

Schwartz’s legal proceedings are far from over. In February, he was charged with one felony count of tax evasion and four felony counts of filing a false tax return between 2017 and 2020. He was scheduled to be arraigned in that case Friday but it was postponed.

Meanwhile, for the fez-clad Shriners who filled a courtroom Friday, there was much emotion.

“I’m happy,” Bobby Marner, a local Shriner, said after the hearing, while he dabbed his red, wet eyes outside the courtroom. Then he paused, sniffled and added, “But I’m also sad.”


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