Former millionaire Karl Hahn, who once led a lavish Portsmouth lifestyle, pleaded guilty Tuesday to swindling local filmmaker Chase Bailey out of $2 million.
Hahn pleaded guilty to a federal charge of wire fraud in the U.S. District Court of New Hampshire. He was scheduled for an Aug. 15 trial to defend against the criminal charge, but his change of plea cancels the trial.
In March, Hahn faced a deadline to either withdraw a prior guilty plea, or accept an 18-month prison sentence imposed by U.S. District Court Judge Steven McAuliffe. He chose at that time to withdraw his plea and take the case to trial. On Tuesday he reversed the decision.
Hahn, a former financial advisor, also pleaded guilty in April 2016 when he admitted defrauding Bailey “by means of false or fraudulent pretenses.” He endorsed a plea agreement that called for scheduled restitution payments to Bailey and no prison time, but later told the court he didn’t have the money to make the promised payments. In response, the judge imposed the 18-month prison sentence while also allowing Hahn the option to have a trial.
Bailey told the Portsmouth Herald on Tuesday that he was introduced to Hahn in 2006 and “after having known him a few years, I regarded him as a friend and adviser.”
“I trusted him completely,” Bailey said. “We attended each other’s family events, and I believed we were very close. I was completely fooled.”
Bailey compared Hahn to Bernard “Bernie” Madoff and called him a “thief, a scoundrel, a criminal.” Madoff victim “Elie Wiesel lost everything,” Bailey said, and like Madoff, “Hahn stole everything from me.”
Bailey said he was raised in a poor neighborhood in Kansas, joined the in 1967, and fought in the Vietnam War. He said he received his college education through the G.I. bill, then went to Silicon Valley “and became very successful.”
“I worked hard for over 30 years and I saved enough money to help my children and subsequent grandchildren enjoy a life far easier than the one I had growing up in the Midwest,” he said. “All my funds and dreams for my children and grandchildren were stolen by Karl Hahn.”
The federal court noted Tuesday that Hahn will be sentenced on Nov. 8 in the federal courthouse in Concord.
Hahn was scheduled to plead guilty in the same federal court in October 2011, but backed out of a prior negotiated plea deal at the 11th hour. He was subsequently stripped of his New Hampshire Securities license by the Bureau of Securities Regulation.
Hahn previously lived in a Portsmouth water-front mansion where he docked a yacht. The mansion and yacht were repossessed.