ATLANTA (AP)—An Atlanta man convicted of defrauding thousands of investors out of $400 million by selling them payphones was sentenced Thursday to 13 years in federal prison for wire fraud and money laundering.

U.S. District Judge Jack T. Camp also ordered Charles E. Edwards to pay $320 million in restitution.

Edwards, 67, made $21 million over a four-year period by persuading 12,000 investors, mostly retirees and others on fixed incomes, to pay $5,000 to $7,000 per coin-operated phone and lease them back to his ETS Payphones Inc. with a 14 percent annual profit, prosecutors said.

ETS promised to buy back the phones upon request but actually did not have the resources to do that, U.S. Attorney David E. Nahmias said.

Nahmias said evidence in a threeweek trial in September showed that in July, 2000, two months before ETS filed for bankruptcy, Edwards personally assured investors that ETS was financially sound and had made a profit of nearly $8,700,000 the previous year.

ETS was never profitable and always needed to obtain money from new investors to make the monthly lease payments to existing investors, the prosecutor said.

He said Edwards, who was indicted in June 2004, used much of the money for commissions to the many sales agents who sold payphones to the victims. He also created an aura of legitimacy for himself and the company through private jets, luxury automobiles and beach-front homes at Sea Island and St. Simons Island, Nahmias said.

Source: AP - AP Wire Service