Four men are scheduled to be sentenced in a Minneapolis federal court Thursday for their roles in the state's second-largest Ponzi scheme.

But before that, the case will take another dramatic turn when prosecutors seek to present evidence of an alleged murder plot against one of the defendants, and two of the defendants argue that the late disclosure of the alleged plot warrants a new trial.

The $194 million Ponzi scheme bilked more than 700 investors nationwide, mostly retirees. It was run by Trevor Cook, a Burnsville money manager who is serving a 25-year prison term.

The four men facing sentencing Thursday were Cook's key operatives: Jason "Bo" Beckman, Gerald Durand, Patrick Kiley and Christopher Pettengill.

Last week, the U.S. attorney's office filed a surprise motion to hold a hearing before the sentences are handed down to present their evidence about a plot to murder Beckman. The motion said Durand proposed to Pettengill that they have Beckman killed in order to collect and split the proceeds of his $2.5 million life insurance policy.

Durand's attorney, Brian Toder, responded by filing his own motion asking Chief U.S. District Judge Michael Davis to deny the hearing, but the judge has agreed to it. Toder said the hearing gives Pettengill, who testified for the prosecution, one more chance to tell lies, which he says he did frequently throughout his trial.

Stan Schmidt, Star Tribune
Chris Pettengill

Court records show that prosecutors knew about the alleged plot for quite some time but failed to turn over FBI interview notes to defense attorneys until Dec. 28. Prosecutors chalk up the failure to human error, noting that they turned over more than 7 terabytes of computer evidence. In court filings, they argue that the error does not warrant a new trial because the alleged murder plot was not relevant to the fraud scheme.

Attorneys for Beckman and Durand argued in court filings that the failure was significant and might have resulted in a different outcome, on at least some charges.

David Chanen • 612-673-4465