Defense attorneys in fraud case file motion to dismiss charges
June 17, 2013
The defense counsels for Gold Country Lenders CEO Philip Lester and CFO Susan Laferte filed a 106-page motion Friday to dismiss the criminal indictment against the pair.
Laferte and Lester were indicted by a criminal grand jury for allegedly defrauding investors of millions of dollars over a period of eight years. They face 61 counts each of elder abuse, securities fraud and conspiracy.
The complex fraud case has been contentious from the get-go with accusations being aired by Laferte's attorney, Greg Klein, and Lester's attorney, Ken Tribby, and with counter-charges being leveled by California Deputy Attorney General Maggy Krell.
Nevada County Superior Court Judge Candace Heidelberger has on several occasions requested better communication and cooperation among the parties.
At the last hearing, May 22, Heidelberger said she was unwilling to postpone the jury trial, which has been delayed several times, any further than its current date of Sept. 17.
The motion filed in Nevada County Superior Court by Klein and Tribby argues that all 61 counts of the indictment should be dismissed because Krell "failed to offer a significant, if not staggering, amount of exculpatory evidence in this case" — evidence that could prove that Lester and Laferte are innocent of the charges against them.
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"The prosecutor only told her side of the story, which did not fulfill her duty," the motion reads.
The motion alleges that Krell "played on the jurors' sympathies for investors who allegedly lost their life savings, but failed to disclose copious amounts of exculpatory information including more than $20 million paid to investors over the same period of time they were allegedly defrauding them."
According to the motion, Krell told the grand jurors it didn't matter if the investors were careless with their money or if they had their heads in the sand.
"In fact, the law does impose responsibility on investors who sign but fail to read their contracts," the motion reads.
The motion by Tribby and Klein details at great lengths the type of evidence that could have been presented to buttress their clients' innocence.
For one, Krell failed to offer evidence that the massive economic meltdown was the actual cause of the claimants' monetary loss, the motion states.
The motion also alleges that Krell failed to offer documents that prove that proper disclosures were made, and therefore, there was no fraud.
"Despite the fact that (Krell) argued that the defendants defrauded their investors because nothing was done to develop the properties involved, she failed to disclose numerous maps, plans and studies that proved the defendants were in fact working to develop those properties," the motion reads.
Krell allegedly also failed to offer evidence that the statute of limitations had expired on at least 50 of the counts.
"It is the grand jury's job … to weigh all the evidence," the motion states.
"However, in this case, the prosecution did this job for the jury … She decided what was relevant and what was not. She decided what evidence fit her theory of the case and what evidence she did not need to offer because she could explain it away.
"She decided what evidence was credible and allowed her witnesses to contradict the documentary evidence that she possessed and failed to offer … Indictments that are the result of the kind of failures the prosecutor committed in this case should be dismissed."
The motion also argues that the fact that the grand jury was convened in Sacramento, rather than in Nevada County, violated the defendants' right to have their case heard by a jury of their peers.
Krell must file her response to the motion by June 21; a hearing has been set for June 25.
To contact City Editor Liz Kellar, email firstname.lastname@example.org or call 530-477-4229.
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