Radnor businessman sentenced to a year in prison, fined for perjury

Radnor businessman Andrew N. Yao, whose fling with a Penthouse Pet cost him a lot more than money, was sentenced yesterday to one year and one day in federal prison on charges that he lied during bankruptcy proceedings related to the collapse of his company, Student Finance Corp.

U.S. District Court Judge Gregory M. Sleet in Wilmington also fined Yao $3,200 and mandated that he receive three years of supervised probation upon his release, said Assistant U.S. Attorney Doug McCann. Yao, 46, was convicted on two counts of bankruptcy fraud during a trial a year ago.

"We respect the court's sentence," said McCann. Yao's attorney Mark Cedrone declined to comment.

During depositions related to the $400 million dollar bankruptcy of his company, Yao told prosecutors that he had wired $669,000 for maintenance on two aircraft that he owned. In truth, he was sending the money to his mistress, Alexandra "Lexi" Karlsen, a Penthouse Pet and Playboy centerfold with whom he had a six-month affair starting in 2001.

He said that another wire transfer of $150,000 to Las Vegas was for a family celebration. The "family" turned out to be Las Vegas casinos, where Yao gambled heavily.

Prosecutors initially argued that Yao's testimony constituted fraud, but Judge Sleet agreed with Yao's attorneys that he should be sentenced instead on perjury charges.

Yao will stand trial in Philadelphia at the end of the month on 10 felony counts related to the tangled finances of Student Financial Corp. It collapsed in 2002.

Prosecutors claim that he made false statements to obtain a $25 million corporate line of credit and a $6 million personal line of credit. He is also accused of money laundering related to the purchase of a home in Nantucket.