Feb. 06--Marin County District Attorney Ed Berberian said Thursday that former Ross Valley Sanitary District general manager Brett Richards "clearly misused" a $350,000 housing loan from the district, but Richards' legal team said that Richards committed no crime.
Final arguments were delivered in the preliminary hearing to determine if there is probable cause to try Richards on nine felony counts, including misappropriation of public funds, embezzlement and money laundering.
Richards, who has been held in Marin County Jail since August 2013 after being arrested in the Philippines, is accused of taking a $350,000 housing loan from the district that he never used for housing. He could face a maximum 10 years in prison and fines totaling $1.5 million if found guilty.
In his closing argument before Marin County Superior Court Judge Terrence Boren, Berberian said it is evident from Richards' employment agreement with the district that the $350,000 loan given to him was for the purchase of housing in Marin or the San Francisco Bay Area.
"It is clear from the evidence there never was such an action taken by Mr. Richards," Berberian said. The district attorney said Richards instead employed the money for "his own personal uses."
During the hearing, prosecution witness Susan O'Brien, a member of Marin County's Financial Abuse Specialist Team who has worked for a number of companies as both a controller and chief financial officer, testified that she examined Richards' bank records from December 2010, when he received the housing loan, and March 2013, when a warrant was issued for his arrest. O'Brien said there was no indication in the bank records that Richards used the loan to purchase housing.
With the permission of Richards' defense team, Berberian also presented as evidence the fact that a survey of California's 58 county recorder's offices turned up no record of Richards buying or selling real estate property from Oct. 1, 2010, to Aug. 31, 2012. Richards resigned from his $197,000-a-year job by email in July 2012.
As for the multiple counts of money-laundering that Richards has been charged with, Berberian said, "Here is where the charting becomes very important."
The prosecution presented detailed spreadsheets and charts demonstrating how Richards opened five new bank accounts and moved cash in and out of them -- and pre-existing accounts in two other institutions -- after receiving the $350,000 loan from the district.
"We think all of this shows a pattern of movement that qualifies under the money laundering statutes," Berberian said.
But Richards' defense team said the prosecution failed to provide any evidence that their client committed a crime. Attorney Michael Clough said there was no evidence presented showing a loan to Richards, authorized by a subcommittee of the district board, was unlawful; that Richards violated the terms of a loan agreement; or that Richards was required to purchase housing "by a date certain." He said the bank transactions Richards made after receiving the $350,000 loan were all perfectly legal.
Clough said Berberian's decision not to call any members of the district board to testify was a "glaring evidentiary omission."
Berberian responded by noting that Richards' defense team presented no evidence and called not a single witness during the three-day hearing.
Judge Boren scheduled a hearing for 10 a.m. Friday to announce whether he will order Richards bound for trial.
Richards' co-counsel Jai Gohel said he will request a reduction in Richards' bail, which is currently set at $1 million.
Contact Richard Halstead via e-mail at firstname.lastname@example.org. Follow him at twitter.com/halsteadrichard
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