Fraudulant fundraiser expected to turn ’self in
A celebrity fundraiser who bilked a private school in Santa Monica out of more than $500,000 will turn himself into authorities this month.
Aaron Tonken was sentenced last week to 63 months in prison for his scheme to defraud donors and underwriters in connection with his promotion and production of charitable events. United States District Court Judge Dale S. Fischer ordered Tonken to pay approximately $3.8 million in restitution to his victims, and placed him on supervised release for three years. Tonken was ordered to report to United States Marshals, who will designate a correctional institution for him on Sept. 22.
Tonken, who faces separate civil lawsuits with similar charges, pleaded guilty on Dec. 9, 2003, to mail and wire fraud for setting up elaborate charity fundraisers, and then keeping profits for himself. He has since filed for bankruptcy.
Westside Waldorf School on Fourth Street is one of the victims named in a civil suit, which was levied by the State of California Attorney General’s Office this past March. The local, 170-student private school was forced into an economic crisis three years ago after Tonken arranged for a major donation from the Cynthia Gershman Foundation that never fully came through, officials said.
Tonken, who has offices in Beverly Hills, allegedly brought two donors to the school in January of 2001 — Cynthia Gershman, a trustee of the Cynthia Gershman Foundation, who signed a pledge to Waldorf for $650,000, and Loren Arbus, who agreed to put on four annual fundraisers.
After paying Tonken for arranging the donation and putting forward a good-faith deposit, the school was left hanging. Waldorf ended up having to foot the bill for vendors at one of the fundraisers that was meant to be donated by Arbus, officials said.
And shortly after the first event fell apart, Gershman withdrew her “irrevocable pledge,” which sent the school further into an economic tailspin. Gershman didn’t provide any reason for the change of heart, school officials said.
A civil lawsuit also has been filed against Gershman, with Waldorf as one of the plaintiffs.
Jeffrey Graham, the director of Waldorf, said while the school is still reeling from the financial loss, it is recovering well.
“If we were to get any money back from this lawsuit it would provide us with part of the capital to develop more programs,” he said, adding Waldorf recently opened an early childhood center on 15th Street. “We are not distracted by the case or the promise of moving ahead in building a stronger community school.”
Waldorf School is just one of many organizations and individuals Tonken allegedly defrauded, according to prosecutors. Among them are fundraisers with Diana Ross, Milton Berle and the cast of the television program “Ally McBeal.”
In the state’s civil suit, prosecutors allege Tonken took more than $1.7 million from Waldorf, charities supported by former President Bill Clinton, comedian Whoopi Goldberg, and actors Michael J. Fox and Michelle Pfeiffer, among others.
The civil lawsuit, which seeks a permanent injunction barring Tonken and the other defendants from fundrais-ing or disbursing donations, is for $1.7 million in general damages, civil penalties of at least $350,000 and unspecified punitive damages. The civil trial against Tonken is scheduled to begin in January.
It’s unknown if the criminal case will be used in the civil court proceedings.
“We were building evidence before the feds got involved,” said Tom Dresslar, spokesman for the Attorney General’s Office. “The judge will make a decision based on the evidence we present.”
The U.S. Attorney’s Office said Tonken used the contributions for his personal benefit, including payment of personal loans and the purchase of luxury items. In a scheme reminiscent of “The Producers,” he routinely promised more than 100 percent of the net proceeds from the events to multiple charities.
Assistant U.S. Attorney Joseph H. Zwicker said the case isn’t over.
“It’s never over,” he said. “We are continuing to investigate other people that helped him.”
Originally published in the Santa Monica Daily Press print edition on September 2, 2004. Read the original PDF.