Judge rules on records in Gold Country Lenders fraud case
February 21, 2014
A Nevada County Superior Court judge has issued a mixed ruling on a prosecutor's request to quash subpoenas served on 22 alleged victims in the fraud case against Gold Country Lenders Chief Executive Officer Phil Lester and Chief Financial Officer Susan Laferte.
Lester and Laferte were indicted by a criminal grand jury for allegedly defrauding investors of millions of dollars over a period of eight years. They each face 61 counts of using a scheme to defraud, offering securities for sale by means of an untrue statement or omission of a material fact and fraud from an elder adult.
In a Jan. 31 hearing, Lester's court-appointed attorney, Mary Beth Acton, told Judge Candace Heidelberger that she had requested documents related to loans that are listed in the indictment against her client, as well as tax records from the pertinent years.
Most of the subpoeanas requested "any and all tax records" from January 2007 through the present, as well as "any and all records, reports, notes, documents, correspondence, letters, files, memos, phone logs, emails, notes and checks" regarding specific loans, as well as Phil Lester and Gold Country Lenders, from 2007-08 to the present.
Heidelberger met with the attorneys in chambers to hear their arguments and then took their arguments under submission.
In a ruling issued Friday, Heidelberger noted state Deputy Attorney General Maggy Krell's objections to the subpoenas, which included an assertion that the request for records was extremely broad and covered a wide array of personal financial information, that it covered time periods beyond the dates alleged in the indictment, that it sought information that already had been provided to the defense and that it violated the alleged victims' rights under Marsy's Law not to have confidential information disclosed.
Heidelberger ruled that there is no absolute protection against disclosure when it comes to tax returns and determined after the in-camera meeting that the defense met the burden of proof in arguing that good cause existed to compel the disclosure of some of the records.
She ordered that portions of tax records that contain information directly related to the specific loans named in the indictment be produced. But she limited that to tax returns up to tax year 2012. Other records must be produced, but only up through Jan. 17, 2013. The alleged victims' tax returns from 2013 and 2014, as well as any records after Jan. 18, 2013, will not be required.
The records are to be produced by Feb. 28 and will be reviewed by Heidelberger in chambers so she can determine if they are relevant to the charges or could be used for the defense. All of the documents will be under protective order and sealed to the public, she ruled.
The trial is set for May 13, with jury selection to start May 6. Lester and Laferte will be in court at 1 p.m. for a conference on Friday.
To contact City Editor Liz Kellar, email email@example.com or call 530-477-4229.