The promoters of a supposedly inflatable motorcycle vest have been sentenced on 30 felony counts of securities fraud and grand theft, as well as five counts of tax evasion, California Attorney General Bill Lockyer announced.
John Duhamell and Toni Duhamell were formally sentenced in San Bernardino County Superior Court. The Duhamells were prosecuted by the Attorney Generals Special Crimes Unit resulting from an investigation conducted by the Inland Empire Financial Crimes Task Force.
After they entered guilty pleas on all counts, a San Bernardino Superior Court judge sentenced John Duhamell to seven years in state prison and Toni Duhamell to four years and four months in state prison. In addition, the Duhamells were ordered to repay their more than 200 victims $5.6 million in restitution, and they were also ordered to pay $816,718 each to the Franchise Tax Board on the tax evasion charges.
The Attorney General filed a criminal complaint in September, 2005 alleging that the Duhamells stole more than $5 million from investors over the course of three years on the pretense of financing a product known as the AirVest - a vest worn by motorcyclists that is designed to automatically inflate when they are thrown from their bikes.
The Duhamells falsely told potential investors that Harley-Davidson, Inc. had invested heavily in the company. John Duhamell also falsely told potential investors that he was the independently wealthy son of billionaire Kirk Kerkorian.
These false representations led more than 200 victims to believe their investment was secure due to the backing of Harley-Davidson and Kerkorian. Although the Duhamells victims hail from across the globe, the majority of the defrauded investors are from San Bernardino County.
Instead of putting the money into the company, the Duhamells used the investors' cash to live an extravagant lifestyle that included trips to Europe as well as the purchase of luxury homes and automobiles.