This is Part 3 of the 5-part blog series. In Part 2, I explained how lying to my lawyer gave the government a stronger case—and how my co-defendant used that to his advantage.
The Phone Call That Ended My Denial
A year passed after my disastrous proffer meeting with the FBI. I told myself they forgot about me. I convinced others, too. I had a new real estate license. I was closing deals in Calabasas. My income was up. I thought I got away with it.
Then, on April 28, 2006—exactly one year after the FBI interview—my mom called, crying. She was reading the Los Angeles Times. Keith, my co-defendant, had pled guilty. At the end of the article, it mentioned an unnamed broker. She asked me if it could be me.
While I was still on the phone, my lawyer called. His voice was flat. He said, “Bad news is you’re going to prison. Good news is I can cap it at 60 months.”
Everything changed in five minutes.
Silence Doesn’t Mean Safety
People assume the worst part of a case is the indictment. It’s not. It’s the waiting. The silence. The illusion that maybe nothing will come of it. That false confidence led me to rebuild a life I would soon lose again.
Keith had been cooperating for months. I was the only one pretending nothing was happening. That mindset is what destroys defendants. If you wait for a formal charge to start preparing, you’ve already fallen behind.
The prosecutors hadn’t forgotten about me. They were building their timeline. They already had what they needed.
The Illusion of a Fresh Start
When you start earning again, building again, it’s easy to think things are over. That was my mistake. I ignored the legal bills. I ignored UBS quietly settling lawsuits. I ignored the fact that a press release would always come—because they want the deterrent.
I even asked my lawyers to avoid the press release. That was naïve. The government wants people to see that even those who look like they’ve moved on can still face consequences. It reinforces their message: no one escapes accountability.
What I Did When It Became Real
After I signed the plea agreement, the panic set in. I started helping the SEC. I showed them things they didn’t know. That effort—late as it was—meant something. It gave them more context. It helped me regain some credibility. But it didn’t undo what I had done.
I told them about emails. Culture at UBS. How incentives pushed people to look the other way. I owned parts I hadn’t previously disclosed. And I paid restitution. UBS had already contributed over $8 million. I added $500,000. Full restitution mattered at sentencing.
Still, none of it erased the fact that I wasted my chance at truth when it mattered most.
What the Government Saw
They saw someone who lied, then delayed, then cooperated. Judges and prosecutors remember the order in which things happen. They don’t just care what you do—they care when you do it. Early accountability earns leniency. Late-stage panic doesn’t.
By the time I was facing sentencing, my co-defendant had been indicted again. That opened the door for me to show I could be useful. But I had to work twice as hard to prove I wasn’t still hiding.
A Question You Need to Ask Yourself Now
Are you mistaking silence for safety? If so, you’re setting yourself up for the same gut-punch I got on that phone call.
The time to prepare isn’t when the government speaks. It’s when they go quiet.
Don’t wait for the headlines. Don’t assume no news is good news. Join our weekly webinar every Tuesday at 11AM Pacific / 2PM Eastern or schedule a personal call. We’ll help you build a record now—before the silence ends with a knock, a headline, or a sentencing date.
Justin Paperny
