Tuesday, April 18, 2000 | 10:24 a.m.
BATON ROUGE, La. - Edwin Edwards spent in the range of $704,000 to $872,000 more in cash than he reported making in the years 1986 to 1997, an Internal Revenue Service agent testified Monday before the government rested in the former governor's federal racketeering trial.
Closing arguments will begin Tuesday.
The defense rested Friday, but U.S. District Judge Frank Polozola allowed prosecutors to call rebuttal witnesses to counter some of the defense case.
Don Semesky was called in an apparent attempt to belie Edwards' claim that a large part of the cash he spent over the years came from gambling winnings.
Edwards, his son Stephen, state Sen. Greg Tarver and four others are on trial, accused of taking part in a series of schemes to manipulate the licensing of riverboat casinos before and after Edwards' fourth and final term ended in January 1996. Their trial started Jan. 10.
Prosecutors say Edwards received the payoffs in cash and used evidence of his spending of large amounts of cash for big-ticket items to bolster their case.
Semesky used two different starting points to come up with the two different estimates of how much cash Edwards spent.
First, to get $872,000 in excess expenditures, Semesky credited Edwards with having $82,000 in cash on hand at the end of 1986 - a figure he derived from Edwards a year earlier in his trial on charges stemming from health care investments. Edwards was acquitted on those charges.
But Semesky also did calculations based on testimony in the current trial, in which Edwards said he always keeps between $250,000 and $500,000 in cash on hand at all times. That led to his lower estimate of $704,000.
Semesky also said his examination indicated Edwards got and spent most of the cash at issue in the later years, particularly 1996 and 1997. Former casino owner Bobby Guidry has said he funneled an estimated $1.5 million to Edwin and Stephen Edwards and their friend Andrew Martin beginning in 1996 and continuing into the next year.
Edwards' attorney, Dan Small, said Semesky's calculations were not accurate because they showed that Edwards had $380,000 of unaccounted cash that the FBI found when it raided Edwards home. Small said Edwards never denied that he received the money from former San Francisco 49ers owner Eddie DeBartolo Jr. and that it should have been included in Semesky's calculations of incoming cash Edwards received.
Semesky said the government did not include the figure in incoming cash because it believes the payment was illegal.
Semesky's figures corroborate to some extent testimony during the early part of the trial by FBI financial witness Laura East, who said her investigation showed Edward spent nearly $1.6 million in cash from 1994 through 1996 with no records to show where more than $740,000 of the money came from.
However, Small challenged East's credibility on cross examination when he announced to jurors that she had lied about her experience testifying as an expert witness.
He made sure that jurors were reminded of her again when he began questioning Semesky.
"You came in six weeks ago? I take it that that is right after Laura East's testimony?" Small asked.
Semesky said he did not know.
That Semesky was allowed to revisit the issue in front of the jury was a bitter pill for the defense. Defense lawyers had argued that the prosecution should not be allowed to call a rebuttal witness who would go over the same ground East covered before the prosecution rested its case.
Prosecutors said Semesky's testimony was needed in light of Edwards' testimony last week indicating much of the cash he spent came from legal gambling winnings.
The jury also heard Monday from two other rebuttal witnesses called to counter defense claims that ledgers kept by witness Ricky Shetler, purportedly to record payoffs made to Edwin and Stephen Edwards, included money Shetler paid to the Edwardses for 1997 Super Bowl tickets. Shetler is heard in a taped conversation asking Stephen Edwards for Super Bowl tickets.
Shetler's ex-wife and a former employee both testified that he did not attend the Super Bowl.
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