Ponzi figure Stokes dies in prison

$19M fraud took retirement savings from thousands of victims; death follows complaints by prisoner of poor health care

Barry Stokes, the politically ambitious Middle Tennessee entrepreneur who turned out to be a life-wrecking con man, is dead.

A spokesperson for the U.S. Federal Bureau of Prisons confirmed this morning that Stokes died Sunday at the Federal Medical Center in Butner, N.C. He was 54.

The BOP gave no information on the cause of death, but Stokes himself had said in a letter earlier this year that he was gravely ill, complaining prison officials had repeatedly denied him medical treatment.

Stokes ran 1Point Solutions, a Dickson-based employee benefits firm that experienced rapid growth in the years after he bought it in 2001. He became known as an art collector and a fundraiser for Democratic Party causes. In 2003 he was among the hosts of a $1,000-a-plate fundraising event for Democratic presidential candidate John Edwards, then a senator from North Carolina.

Stokes later told a court that he had been "a law-abiding citizen" as of the late 1990s, "hardworking, deeply involved in his community, and a committed foster parent." But after he and his then-wife were "ordered to return his foster children of six years to their unstable biological mother," he became "disillusioned by the justice system that took them away" and "lost his moral compass."

As Stokes told the story, he reasoned that he could acquire the influence necessary to prevail in the custody dispute if only he could make his company sufficiently prominent to attract the attention of political leaders. "Mr. Stokes had been very involved in political campaigns for many years and had some sense of the sort of political favors that politicians do for their financial backers," he stated in a pre-sentencing filing.

In September 2006, NashvillePost.com broke the news that Stokes' financial empire was collapsing, taking with it some $19 million in retirement savings entrusted to him by companies on behalf of thousands of employees. He was arrested after an appearance at U.S. Bankruptcy Court the following month and had remained incarcerated ever since.

Stokes entered guilty pleas in September 2008 to 78 counts of embezzlement, mail fraud, money laundering and bankruptcy fraud. At his sentencing last year, several victims took the stand to describe how he had impacted their lives. Some told of losing their retirement funds entirely, with one woman estimating that the life savings Stokes took from her was worth about as much as one of the more than 1,000 Japanese woodblock prints he purchased for himself.

Another woman, addressing Stokes' plea to get credit on his sentence for the assistance he has given prosecutors in sorting out his affairs, stated: "This experience has been like a rape, and anything he did to help out after the fact is no better than putting the clothes back on the victim."

Judge Robert Echols sentenced Stokes to 12 and a half years.

Before his trial, Stokes had asked the court to let him out of jail on his own recognizance, listing numerous medical problems that he claimed would keep him from being a flight risk.

In addition to a recent diagnosis of lymphoma, Stokes said he suffered from deep vein thrombosis in his leg, a possible torn tendon in the ankle, a possible cracked rib, a diet poorly suited to a diabetic's nutritional needs and uncontrollable itching.

Echols denied the request for release.

Federal authorities sent Stokes to a federal prison camp at Marion, Ill. after his sentencing. From there, he sent a handwritten letter to Nashville's U.S. District Court on March 4 of this year, complaining of his medical treatment at the prison:

Upon arrival at Marion, the medical staff discontinued Mr. Stokes' medicines that were prescribed by physicians in Nashville. After one month, Mr. Stokes' health declined to a point that he passed out. He was transferred to emergency room at the local regional hospital where he spent five days. Mr. Stokes was sent back after his diagnosis by the Nashville physicians was reaffirmed and was told he needed immediate care by specialists, none of which practice in Southern Illinois.

After two months of non-treatment, Mr. Stokes passed out again and was rushed back to Heartland Regional Hospital where he required emergency surgery to save his life. Mr. Stokes also had grown cancerous nodes on his thyroid and liver. Heartland did two more surgeries on Mr. Stokes and removed his cancerous thyroid. However, they refused to operate on his liver, as it was beyond their skill set.

They sent him back with orders for two follow-up treatments, one of which is chemo-radioactive iodine treatment to prevent cancer from reoccuring in the thyroid region. BOP Marion has refused Mr. Stokes either treatment. Mr. Stokes has come to the conclusion that the only way to receive medical treatment is to file appeal and get out so he may seek his own treatment.

Soon after that letter reached the court, Stokes was transferred to Butner, a special medical facility where one of his fellow inmates was fraudster B. Don James, the Cookeville insurance agent whose Ponzi scheme cost investors some $8 million.

Information on Stokes' next of kin was not immediately available today.