Prosecutors are asking a federal judge to sentence former Atlantic City Mayor Frank Gilliam to a prison term of 15 to 21 months plus three years of supervised release in connection with a scheme to defraud AC Starz, a nonprofit youth basketball team he founded.

Gilliam pleaded guilty Oct. 3, 2019, to a charge of wire fraud and resigned later the same day as mayor of Atlantic City. His sentencing, delayed multiple times, was set to take place Thursday via videoconference before U.S. District Judge Joseph H. Rodriguez in Camden, but was ordered rescheduled again late Tuesday, a courtroom deputy said.

In a five-page sentencing memorandum filed by Assistant U.S. Attorney Sean Farrell, prosecutors argue that Gilliam’s “history and characteristics,” while marked by tragedy, do not merit a downward departure from the sentencing guidelines.

Atlantic City Mayor Frank Gilliam leaves his home, with his passport in hand, on his way to federal court on Thursday, Oct. 3, 2019.
Amy S. Rosenberg / Staff
Atlantic City Mayor Frank Gilliam leaves his home, with his passport in hand, on his way to federal court on Thursday, Oct. 3, 2019.

“Gilliam experienced tragedy early in his life and turned to basketball both as an outlet and to avoid the pitfalls of living in a tough neighborhood plagued by drug use,” Farrell wrote, in a redacted copy of the memorandum released to The Inquirer, a reference to Gilliam’s father having murdered his mother inside the family’s home when Gilliam was 3.

“But instead of using AC Starz to teach the game he loves and make a difference in the lives of young people through basketball, he used the team as a personal piggy bank in order to furnish a lifestyle that he otherwise could not afford,” Farrell wrote.

In their 48-page memorandum, released in significantly-redacted form, Gilliam’s attorneys ask the judge not to sentence the 50-year-old Atlantic City native to jail, tracing the disgraced mayor’s life story and asserting that Gilliam continues to experience “extreme remorse.”

“Mr. Gilliam repeatedly has admitted that he made a terrible, life-altering mistake that will weigh on him for the rest of his life,” the lawyers state. “Mr. Gilliam would like the Court to know that he has helped others all of his life as a volunteer coach, behavioral therapist and community advocate.”

The defense lawyers stressed that AC Starz was an outgrowth of Gilliam’s passion for basketball, which, Gilliam himself wrote to the court, “became my outlet that silenced all the noise. The court was my sanctuary and I worshiped its every rule.”

In a letter dated Dec. 11, 2020, Gilliam reflected his continuing remorse, and described hitting “some emotional lows.” He asked the judge to sentence him to probation and 500 hours of community service.

“Over the past year, I have had time to think about who I am and what will become of me and my life moving forward,” he wrote, according to the memo. “The feeling of being extremely saddened and sorry about my actions has continuously haunted my thoughts on a daily basis.

“As hard as I try to walk with my head held high, the burden of my choices remains ever present,” he wrote.

The government is also seeking full restitution of the $86,790 in contributions to AC Starz given “under the false pretense that the contributions were for the team’s basketball-related activities and school supplies for underprivileged children.”

Instead, Gilliam used the money for personal expenses, the government charged, including high-end clothing, trips, and meals unrelated to the operation of a youth basketball team. In a separate incident in 2018, he was involved in a fight outside the Golden Nugget casino and charged in municipal court with assault and harassment, charges that were later dropped.

Atlantic City Mayor Frank Gilliam leaves the North Wildwood Municipal Court in on February 28, 2019. The assault complaints against Gilliam and Councilman Jeffree Fauntleroy were dismissed.
David Maialetti / MCT
Atlantic City Mayor Frank Gilliam leaves the North Wildwood Municipal Court in on February 28, 2019. The assault complaints against Gilliam and Councilman Jeffree Fauntleroy were dismissed.

The government’s memo noted that Gilliam has repaid a good portion of the money, including $41,335 in cash seized during a search of his home Dec. 7, 2018, that he agreed should be applied to his restitution obligation.

Gilliam’s attorneys noted that he has paid back an addition $12,455.01 since then. Still, prosecutors argued that “gradually making the victims of his fraud whole” is not enough to justify a downward variance in punishment.

“Gilliam’s offense was unquestionably serious,” the prosecutor wrote. “This type of greed and deception, particularly when committed by an elected official, warrants a sentence of imprisonment.”

Gilliam’s arrest, guilty plea, and resignation continued a long streak of corruption inside Atlantic City’s City Hall, a few blocks from the seaside resort’s famous Boardwalk. He was the fifth Atlantic City mayor to be arrested on corruption charges since the 1970s.

Further back, the city’s colorful history of political corruption dating to the early 20th century was the basis for the book and HBO series Boardwalk Empire.

Gilliam’s attorneys argue as well that the “collateral consequences” suffered by Gilliam, including “public humiliation and shame,” have haunted him and support a more lenient sentence. They also cite the dangers of the pandemic in prison as an argument for probation.

“Mr. Gilliam resigned as mayor and will forever wear a scarlet letter as the former convicted mayor of Atlantic City,” the lawyers wrote. “Atlantic City is a small town, which has resulted in the loss of personal and professional relationships for Mr. Gilliam.

“Mr. Gilliam has lost what was most precious to him professionally: the ability to serve the City of Atlantic City.”

The charge of wire fraud carried a maximum sentence of 20 years in prison.

Atlantic City’s current mayor, Marty Small Sr., was sworn in earlier this month to complete a one-year unexpired term.