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B.C. Securities Commission (C-*BCSC) - Street Wire
BCSC Eron figure Chambers makes first Purdy application
B.C. Securities Commission *BCSC
Monday July 14 2003 Street Wire
by Brent Mudry
Howe Street promoter John (Jack) Purdy has paved the way for a court bid by associate Martin Chambers to seek full disclosure of RCMP evidence against him in his Bermuda Short money laundering case in Miami. In a petition filed Thursday in the Supreme Court of British Columbia, the controversial former Vancouver lawyer supports his disclosure bid with Canada's Constitution Act and the Canadian Charter of Rights and Freedoms.
The Canadian court challenge comes a month before the scheduled Aug. 11 start of Mr. Chambers's two-week trial in United States District Court for the Southern District of Florida. Although no such filings have yet been made in the Florida court, Mr. Chambers's U.S. lawyers, Donald Re of Los Angeles and Gerald Houlihan of Miami are expected to seek a continuance, or trial delay, unless Canadian authorities provide the RCMP dossier in the next few weeks. Mr. Re asserts that the RCMP disclosure sought is "essential to a proper presentation" of both pretrial motions and the trial defence. Assistant U.S. Attorney Richard Hong has opposed previous defence continuance applications.
Mr. Chambers's piggyback challenge comes two months after Mr. Purdy, represented by veteran Vancouver defence counsel Richard Peck and David Martin, made Canadian history winning a precedent-setting similar case on May 9 in B.C.'s Supreme Court. The Attorney General of Canada lost its appeal June 17 at the end of a full-day hearing in the Court of Appeal for British Columbia. The Canadian government is likely to appeal the case to the Supreme Court of Canada, although no such decision has yet been made, partly as the three-judge B.C. appeal panel has not yet prepared and released its written reasons.
Although it provides the judicial backdrop, the Canadian Purdy challenge is not noted in Mr. Chambers's petition, filed by his lead Canadian lawyer, Howard Rubin of North Vancouver, a former drug prosecutor who defended Mr. Chambers fighting major cocaine conspiracy charges, a 10-year ordeal which ended a decade ago when the Crown stayed the case. The current Chambers challenge is believed to be the first Purdy application made in Canada since the landmark Purdy ruling was handed down in April.
Mr. Purdy and Mr. Chambers were charged last August in separate money laundering indictments in Operation Bermuda Short, a joint RCMP-FBI undercover sting. The two-pronged operation -- one for alleged bribing of fictitious mutual fund officials, the other for alleged drug money laundering, was unveiled Aug. 15, with the unsealing of 23 indictments and arrests of 58 targets, including 20 Canadians.
All parties remain presumed innocent until proven otherwise. A number of targets have pled guilty, some have been acquitted at trial, a few have had their charges dropped of stayed, and most, including Mr. Purdy and Mr. Chambers, maintain their innocence. Mr. Purdy was acquitted after his first two-week jury trial in February, but faces a second trial, on his second Bermuda Short indictment, this fall.
Mr. Chambers faces five counts of money laundering and conspiracy to launder money. If convicted on any of these charges, he faces a potential maximum of 20 years imprisonment.
Mr. Chambers has been in jail the past 11 months, since his arrest Aug. 14 at the airport in St. Louis, Mo., en route to Fort Lauderdale, Fla., as a top target in the Bermuda Short sting. In the money-laundering arm of the sting, an undercover FBI agent and an undercover RCMP officer posed as agents of the Colombian Cali cocaine cartel to lure targets to agree to launder millions of dollars of dirty drug money.
After several bail applications, Mr. Chambers won bail on Feb. 25, consisting of a $500,000 (U.S.) bond with secret sureties, due to defence concerns about the RCMP and Stockwatch, personal surety bonds of $1-million (U.S.) by Mr. Chambers and his wife, and conditions of 24-hour house arrest with low level electronic communications monitoring.
Mr. Chambers originally won bail last fall on much lighter terms, but the U.S. Department of Justice overturned this on appeal. Miami prosecutor Mr. Hong introduced unflattering Canadian police evidence, including RCMP intelligence linking Mr. Chambers with the contract killings of four underworld figures, including Ernie Ozolins, a former high-ranking Hells Angels member, and David Ward, a convicted penny stock promoter, and with Russian organized crime. No such charges have ever been laid against Mr. Chambers, and this RCMP intelligence has never been proven in court.
After passing a nebbia test, to ensure pledged bail funds are clean, Mr. Chambers was released from a Miami pretrial detention jail on Canada Day, July 1, and transferred to custody of immigration officials. Mr. Chambers is believed to be still getting processed at the Krome Detention Center outside Miami by the Bureau of Citizenship and Immigration Services, or BCIS, the successor to the Immigration and Naturalization Service in the new U.S. Department of Homeland Security, a stepping stone before his release from federal custody into house arrest.
In the current Canadian court petition, lawyer Mr. Rubin seeks full disclosure of all RCMP records of the Bermuda Short investigation into Mr. Chambers, plus any previous RCMP investigation into Mr. Chambers which provided the "intelligence, background or leads" for the Bermuda Short probe.
Mr. Rubin notes that an RCMP Integrated Proceeds of Crime investigator, posing as a Colombian cartel associate, first made undercover contact with Mr. Chambers on April 11, 2002, in Fort Lauderdale, Fla. (Although no publication ban on the officer's identity exists, Stockwatch uses the operative's undercover name, Bill McDonald, not the real name used in court filings.)
"On numerous occasions, when speaking with the Petitioner (Mr. Chambers), Mr. McDonald threatened violence and death to other individuals under investigation if the Petitioner did not assist them in performing various financial transactions in a manner agreeable to Mr. McDonald," states Mr. Rubin in his filing.
"Mr. McDonald was the only law enforcement officer to have any substantive contact with the Petitioner in conjunction with the 'Bermuda Short' investigation. He will be one of the key witnesses against the Petitioner."
"The Petitioner will be unable to make full answer and defence to the said Indictment and, particularly to present evidence necessary to establish the Petitioner's defences of outrageous government misconduct and manufactured jurisdiction, unless he has access to materials in the possession of the RCMP recording the product of the Canadian investigation of his activities, part of which constitutes the case tendered against him in the Southern District of Florida," states Mr. Rubin.
The Canadian lawyer estimates his court application will take one day, although no court date has yet been set.
An attached affidavit from lead U.S. defence attorney Mr. Re confirms that Mr. Chambers wasted little time meeting up with Mr. McDonald. Mr. Re notes the Canadian undercover officer "expressed extraordinary delight" on April 9, 2002, at the opportunity to investigate Mr. Chambers, after Mr. Purdy's partner Kevan Garner unwittingly brought Mr. Chambers into the sting operation. Soon after the Bermuda Short arrest operation last August, Mr. Garner pled guilty and now faces a significant jail term.
On April 11, 2002, two days after Mr. McDonald's "extraordinary delight," in which he called Mr. Chambers "Lex Luthor," Superman's arch-nemesis, Mr. Chambers flew down from Vancouver to Fort Lauderdale to meet him in the first of five or six meetings the pair had. "On each occasion, Mr. Chambers traveled from Vancouver to Florida at Mr. McDonald's request," states Mr. Re. Between meetings, Mr. Chambers returned to Vancouver and kept in touch by telephone and E-mail.
The defence lawyer's affidavit gives a preview of what the Miami jury may hear as the defence scenario.
"During a number of conversations with Mr. Chambers, Mr. McDonald threatened violence against other individuals, such as co-accused Kevan Garner, if they did not perform various financial transactions in a manner agreeable to Mr. McDonald. These threats ranged from getting teeth knocked out; to kidnapping children and other family members; to bodily harm and death," states Mr. Re.
"Individuals connected with Canadian law enforcement posed as Colombian thugs who had come to Vancouver, British Columbia, to threatened (sic) physical harm to the individuals under investigation. Mr. McDonald used the existence of these thugs to induce Mr. Chambers to assist the other targets of the investigation to avoid retaliation by the thugs."
"Mr. McDonald was the only law enforcement officer to have any substantive contact with Mr. Chambers in the course of this undercover investigation. The only exposure that Mr. Chambers had to any FBI agent, or representative of United States law enforceement, was an agent at one or two meetings who was present under the guise of serving the food. Mr. McDonald will be one of the key witnesses against Mr. Chambers at his trial," states Mr. Re.
bmudry@stockwatch.com
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