More on the Jack Purdy / Bolivian hardwood saga.....
B.C. Securities Commission (C-*BCSC) - Street Wire
BCSC-known Purdy faces strong second trial, claims U.S.
B.C. Securities Commission *BCSC
Thursday March 20 2003 Street Wire
by Brent Mudry
Although Howe Street penny stock promoter John (Jack) Purdy scored victory in his first Bermuda Short money laundering trial, thanks to a jury acquittal on Feb. 28, a Miami prosecutor is confident of success at Mr. Purdy's second Miami trial, set to start July 7. The claim comes in a recent court filing relating to co-defendant Ronaldo (Ron) Horvat, whose boss Harold Jolliffe has pled guilty, along with Mr. Purdy's former partner Kevan Garner. Mr. Horvat was a junior player, the low man on the totem pole in the alleged money laundering conspiracy, with Mr. Purdy at the top.
"Regardless of the defendant's (Horvat's) characterization of his case, he faces serious money laundering charges, where he faces more than five years of imprisonment under the federal sentencing guidelines, if convicted. The strength of the case remains a strong one against the defendant and his co-defendant John K. Purdy," states Assistant United States Attorney Richard Hong in a filing this week.
Mr. Horvat faces strong government opposition to two recent court applications he made: to have his bail modified to allow his return to Canada, and to have potentially incriminating comments he made just after his Aug. 14 arrest thrown out.
Although a judge has not ruled on either application yet, the stakes may be high. If the government wins, it will retain some leverage over Mr. Horvat in any plea negotiations. If Mr. Horvat wins, he may have little motivation to entertain any offers. It should be noted that Mr. Horvat adamantly maintains his innocence, and no court has yet ruled on the evidence against him.
In the first application, Mr. Horvat, through his Miami defence lawyer Howard Srebnick, seeks bail modifications allowing him to return home to his wife and two young children in British Columbia before his upcoming trial. After spending a month in jail, he was released Sept. 19 and ordered to live with his father-in-law in Gig Harbour, Wash., with a curfew of 11 p.m. to 6 a.m. and electronic monitoring. His bail included an $850,000 personal surety bond collateralized by the homes of family members.
In earlier applications, Mr. Horvat was only granted brief absences, to return to his mother's residence in Canada for 10 days over Christmas, and to fly to Miami for his Feb. 18 trial, which was bumped to July. Mr. Horvat earlier applied in October to return to his family in Canada, based on the terms granted to co-defendant Mr. Jolliffe, but a Miami judge shot this motion down within a week.
Mr. Horvat filed a renewed bid on March 5. "This time, his sole basis for the motion is the delay in trial," states prosecutor Mr. Hong in his reply. "The United States respectfully suggests that the delay in trial is not a material change in circumstances. In fact, a delay in his trial has nothing to do with whether the defendant poses a risk of flight."
While Mr. Horvat argued that he has fully complied with his conditions and he was ready to proceed in February, prosecutor Mr. Hong rejects these arguments, as compliance is "expected and customary" and Mr. Horvat's appearance for the adjourned trial was "not exceptional." The prosecutor further argues that the case against Mr. Horvat and Mr. Purdy remains strong.
Mr. Hong also rejects supporting letters and E-mails sent by Mr. Horvat's immediate family and relatives. "They previously advised the undersigned Assistant U.S. Attorney during telephone conference calls in September 2002 that they knew little or nothing about the facts of this money laundering case."
The prosecutor closes his written submissions by stressing that no material change regarding Mr. Horvat's risk of flight concerns has occurred. "Whether co-defendants, under different circumstances, subsequently received a better or worse bond is irrelevant to any requested modification for this defendant."
In Mr. Horvat's second application, he appeals a judge's rejection of his bid to throw out potentially incriminating statements. Mr. Horvat claims he was roughed up by the FBI during his border arrest last August, causing him to blurt out silly statements about gun running and drug dealing which a trial judge really ought to ignore.
"Horvat was informed that the charges brought against him stemmed from an investigation involving securities fraud and money laundering. Horvat stated he had no idea why the charges were being brought against him," states the FBI arrest report.
"Horvat asked if the charges had anything to do with a $50,000 cash transaction in Florida which he made at the request of his boss. Horvat stated that the transaction had something to do with a deal in the forestry industry."
"On several occasions during the transportation to the INS (Immigration and Naturalization Service) detention center (in Seattle,) Horvat discussed aspects of the $50,000 cash transaction in Florida. Horvat stated that he thought it was odd the transaction was in cash rather than a check," states the FBI report. "Horvat asked what would occur if he made a transaction with funds from illegal activity (Horvat provided gun running and drug dealing as examples) but was unaware the funds were derived from illegal activity."
Mr. Horvat earlier tried to have his unfortunate comments ruled inadmissible as he was coerced under pain, pressure and in postarrest shock to waive his Miranda rights to silence, but U.S. Magistrate Judge John O'Sullivan dismissed his first bid in a Feb. 13 ruling, five days before the start of the first Purdy money laundering trial.
"The defendant is a college-educated businessman, he understood his rights, there was no coercion by the police and the waiver of rights by the defendant was voluntary," ruled Judge O'Sullivan. "The government has shown by a preponderance of the evidence that the defendant understood and voluntarily, knowingly and intelligently waived his Miranda rights prior to any questioning by the governments agents."
Mr. Horvat has now renewed his challenge, appealing the judge's ruling in a bid to keep his potentially incriminating statements from the ears of the jury. As before, prosecutor Mr. Hong strongly objects.
"The FBI's 'handling' of the defendant was inconsequential, there was nothing even remotely close to any beating or torture. The FBI further advised the defendant that his wife had been released before was (sic) any signing of the waiver of rights form and further interview. At bottom, the defendant himself provoked the FBI agents to request the signing of the waiver of rights form by the defendant's insistent questioning of the agents about the defendant's case," states Mr. Hong in a filing this week.
"There was no error on the Magistrate Judge's fact findings or on his application of law to the facts."
No date has yet been set for a judge to consider and rule on both Mr. Horvat's applications.
bmudry@stockwatch.com |
