Judge Orders O.C. Man to Pay Investors

The former chairman of Home Theater Products International Inc. has been ordered by a federal judge to pay $25.3 million to investors who bought stock in the company when 75% of its sales were bogus. Paul R. Safronchik, who pleaded guilty last December to criminal conspiracy, bank fraud and securities fraud, lost his civil case before it ever got to trial in U.S. District Court in Santa Ana. His admission of guilt in the criminal case and inability to raise any defense in the civil case left nothing for a jury to determine, Judge Gary L. Taylor decided last month. HTP’s revenue for the fiscal year that ended June 30, 1995--its first full year as a public company--was $12 million. But Safronchik admitted that $9.3 million of that consisted of phony invoices sent to sham companies at mail drops controlled by him and two other HTP executives. HTP fell apart when its outside accountant determined that the $5-million profit it reported should have been a $4-million loss. The Anaheim manufacturer of home theater electronics products and furniture tried to recover through a bankruptcy reorganization, but was liquidated.