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The San Diego Union, (CA)
September 24, 1990
Author: Philip J. LaVelle, Staff Writer
The Richard T. Silberman money-laundering case turns a page this week, with the financier facing sentencing in federal court today and reputed mob figure Chris Petti up for trial nine days later.
For Silberman, the sentencing will mark the end of a 17-month drama that saw him fall from the highest ranks of San Diego society to the gray anonymity of a federal jail cell.
A self-made millionaire, Silberman, 61, was a prominent businessman and Democratic Party fund-raiser for years. In the 1970s he served as a top aide to then-Gov. Edmund G. “Jerry” Brown Jr., and is married to San Diego County Supervisor Susan Golding.
He became entangled in late 1988 in a money-laundering scheme that allegedly involved Petti — the Chicago mob’s reputed San Diego representative — and as a result he now faces a maximum of 15 years in prison.
Why did this profoundly successful and high-powered figure turn to crime? Prosecutors say it was greed — a greed so powerful it drove him to lies, deception and a “secret life of crime.”
“There’s a constant pattern in Richard Silberman’s conduct of lying to obtain an advantage in financial deals,” Assistant U.S. Attorney Charles F. Gorder Jr. told jurors in mid-June. “He’s manipulating everybody in this financial transaction for his own personal profit.”
Gorder has recommended a term of 46 months for Silberman. U.S. District Judge J. Lawrence Irving has the final say.
Irving also will have final say over how much money — if any — Silberman must pay in a fine.
In a sentencing memorandum filed Friday, the government recommended a $75,000 fine — the maximum allowable under federal sentencing guidelines.
The government’s legal papers also said Silberman made $77,500 from his first money-laundering transaction on Nov. 9, 1988. Prosecutors submitted previously unreleased Swiss bank documents to back its assertion.
Meanwhile last Friday, Silberman’s San Francisco legal team painted him as unable to pay a big fine.
“The simple truth is that Mr. Silberman is already ruined financially both in terms of his existing assets and his earning capacity,” the motion said.
Silberman’s motion also objected to a U.S. probation officer’s report that used the term “underworld” in describing the financier’s links to Petti.
The wording, Silberman’s motion said, could harm his request that the federal Bureau of Prisons send him to the prison camp at Nellis Air Force Base, near Las Vegas.
Petti, 63, has lived under federal law-enforcement scrutiny for years. The Silberman case arose from an FBI probe, beginning in September 1986, into Petti’s alleged efforts to infiltrate gambling operations at the Rincon Indian Reservation in North County.
No charges have been filed in that investigation.
According to the government, Silberman unwittingly walked into the probe when he sought out Petti for money-laundering deals in September 1988. The pair had known each other as customers of the Town & Country Hotel barber shop.
The government says Petti put Silberman in touch with a longtime associate, Robert Benjamin, a lifelong criminal. Unknown to Petti, Benjamin had become an FBI informant.
Benjamin in turn put Silberman in touch with FBI undercover agent Peter Ahearn on Nov. 9, 1988. Ahearn posed as Pete Carmassi, a tough-talking East Coast front for Colombian drug lords.
Silberman’s approach to Petti came after his latest venture, Yuba Natural Resources, had sustained millions of dollars in losses.
“As things went from bad to worse at Yuba, the defendant decided to cash out his holdings by selling out to Colombian narcotics dealers,” said the government’s sentencing memorandum, filed Friday at U.S. District Court.
Despite Silberman’s statements that he was seeking ways to pump money into Yuba, former Silberman associates have said the deals with the undercover agent brought no money to the company.
Silberman and Ahearn struck two money-laundering deals, in late 1988 and early 1989, according to the FBI. The deals involved swaps of cash from Ahearn for stocks and bonds provided by Silberman.
Silberman associates broke the cash down into amounts of less than $10,000 — federal law requires reporting of deals over $10,000 — and it was eventually laundered through banks in Hong Kong and Switzerland, according to trial evidence.
Silberman was arrested by FBI agents at the Hyatt Islandia Hotel on April 7, 1989, after negotiating a third deal to launder $1 million, according to the FBI.
A federal grand jury indicted Silberman, Petti and two other men on April 21, 1989, on charges they helped launder the $300,000 swapped in the two deals. By fall, a fifth man had been indicted.
Silberman stood trial alone earlier this year and professed innocence. A jury convicted him June 28 of one count of structuring a financial transaction to avoid the federal currency reporting law.
Jurors were deadlocked on five other counts, and Irving declared a mistrial and scheduled Silberman for a second trial on the unresolved charges.
The judge also put Silberman — who apparently attempted suicide in a Las Vegas hotel suite in February — in jail as a flight risk.
The probation officer’s report notes that the government suspects Silberman may have “staged” his suicide attempt. Silberman’s documents filed Friday called these comments “cavalier” and said the attempt was “unquestionably genuine.”
It said Silberman, who flew to Las Vegas on Feb. 15 and checked into the Las Vegas Hilon, drank heavily that night and took several sleeping pills and anti-seizure pills prescribed for the family dog.
Silberman was also taking Prozac at the time, an antidepressant that could provoke suicidal thoughts in some patients, Silberman’s documents said.
He is no longer a suicide risk, his papers said.
On Aug. 24 — after sitting in jail for nearly two months — Silberman pleaded guilty to conspiracy to structure an illegal financial transaction.
Silberman admitted to taking part in the deal with Petti and to believing that the cash was proceeds from drug trafficking. His plea agreement does not call for him to testify against Petti. Silberman also agreed to not appeal his jury conviction.
In court papers, Silberman admitted to:
- Discussing with FBI agent Ahearn, at the Nov. 9, 1988 meeting, swapping shares in Yuba American Gold Ltd., a Canadian subsidiary of a company Silberman managed, for $100,000.
- Asking Jack Norman Myers, a broker at Hamilton Williams in Westlake Village, if he could conduct the cash deal without filing currency transaction reports.Myers contacted Terry L. Ziegler, another Hamilton Williams associate, for help with the scheme. Both Myers and Ziegler pleaded guilty to structuring.
- Directing Myers, on Nov. 30, 1988, to pick up $100,000 cash from Ahearn at the Hilton Hotel near Los Angeles International Airport. Myers was accompanied by Darryl Nakatsuka, a Los Angeles security guard set to stand trial with Petti next week.
Record Number: UTS0819252
Copyright 1990, 2007 Union-Tribune Publishing Co.