Colletti seeks new trial

Thursday, July 15, 1999 | 10:25 a.m.

Colletti and the companies that own the Mustang Ranch brothel east of Reno were convicted last week by a federal jury.

Prosecutors claimed A.G.E. Corp. and A.G.E. Enterprises were elaborate fronts to hide fugitive brothel boss Joe Conforte's continued ownership of the bordello east of Reno.

Colletti was accused of funneling money to Conforte, who is believed to be living in South America. She was convicted on eight counts.

In motions filed Wednesday, Colletti's lawyers asked U.S. District Judge Howard McKibben for a new trial.

Attorneys Scott Freeman and David Houston argued prosecutors failed to show that Colletti was anything more than a "low-level participant" in the corporations.

Colletti is scheduled for sentencing on Oct. 25.

The Internal Revenue Service seized the brothel in 1990 and auctioned it off for back taxes. But prosecutors said Conforte, assisted by his former attorney Peter Perry and others, devised an elaborate scheme to cheat the government and buy the property back under the guise of Mustang Properties Inc.

Mustang Properties later sold it to A.G.E., which the government contends was another Conforte front.

Conforte fled in the country in 1991 to avoid prosecution on income tax charges. He was indicted in the racketeering case but remains in hiding.

Perry, who pleaded guilty to wire fraud and is awaiting sentencing, was a key government witness in the trial of Colletti and A.G.E.

The jury also found that the government can seize the infamous brothel and other property owned by A.G.E.

McKibben delayed the turnover of the brothel until Aug. 9 to give employees time to move out.

Jurors also ordered the two companies to forfeit $20 million each and Colletti $220,000 for taking part in the scheme.