Murphy lawyer under fire in Binion probe

Wednesday, June 14, 2000 | 11:25 a.m.

A private detective investigating Ted Binion's slaying said today he received information early in the probe that Las Vegas lawyer William Knudson helped Sandy Murphy store valuables taken from the gambling figure's home after his death.

Tom Dillard, who is working for Binion's $55 million estate, said he was told Knudson allowed Murphy to keep the belongings at his home or his mother's home.

Dillard said he passed on the information to prosecutors, who subpoenaed Knudson's mother, Jean Knudson, to testify in the spring of 1999 before a county grand jury investigating Binion's death.

But the prosecutors presenting evidence to the grand jury never were able to link Knudson's mother to items that may have been stolen from Binion.

And Knudson refused to cooperate with prosecutors, citing his attorney-client relationship with Murphy and her lover, Rick Tabish, who later were convicted of killing Binion on Sept. 17, 1998, and stealing his valuables.

The Sun reported Tuesday that Murphy took bags of silver coins to Knudson's home after Binion's slaying before taking them to her lawyers, Las Vegas Mayor Oscar Goodman and his partner, David Chesnoff.

Murphy, Binion's 28-year-old live-in girlfriend, stayed with Knudson for several days after Binion's death.

Goodman and Chesnoff, courthouse sources said, told Murphy they would inventory the coins, but she took them back before the inventory was completed.

Some of the coins, sources said, later ended up in the hands of Tabish's brother-in-law, Dennis Rehbein, in Missoula, Mont., in November 1998. Rehbein provided authorities with 100 pounds of coins he said Tabish had given him as collateral for a $25,000 loan.

Goodman has declined to comment on the coins other than to say he had "nothing to do with the case." Chesnoff is in Europe and unavailable for comment.

During the Binion murder trial, prosecutors accused Murphy and Tabish of stealing bags of coins and other items of value from Binion's safe on the day of his slaying. The two defendants ultimately were convicted of the theft charges.

Murphy, courthouse sources said, told Goodman and Chesnoff that Binion had given her the coins before he died.

But sources close to Murphy and Tabish, said the defense now is claiming Murphy took the coins from Binion's 2408 Palomino Lane home the day after his death while James J. Brown, the lawyer for Binion's estate, was distracted.

That was the day Murphy, who believed she was to inherit the $900,000 home and its contents, instructed Knudson to videotape the inside of the house.

Knudson acknowledged in an interview with the Sun on Tuesday that some items of value were taken from Binion's home by Murphy on Sept. 18, 1998. But he refused to confirm whether the coins were among them.

He said he was being guarded in his comments because of concerns the district attorney's office still may be investigating Binion's death.

His Los Angeles attorney, Arthur Barens, said today he believes investigators are "fishing" for evidence against Knudson.

"They know my client has never received anything from Binion's estate, nor has he requested anything from the estate," Barens said.

He added that he has been in contact with the district attorney's office in an attempt to clear up any misconceptions about his client.

"I'm hoping that the district attorney will realize that Bill's conduct has never been anything but professional and appropriate," Barens said.

Binion's estate, meanwhile, is continuing its probe into Binion's demise in conjunction with its wrongful death lawsuit against Murphy and Tabish.

"We are very interested in Bill Knudson," Dillard said. "We're interested in what he knows and his interaction with Murphy and Tabish after Binion's death."

Knudson said he is cooperating with an estate subpoena asking for records of his legal fees from Murphy and Tabish.

Goodman's law firm and Murphy's and Tabish's criminal defense lawyers also have received subpoenas seeking records of their legal fees and any other items of value they may have received from the defendants.

The estate wants to know whether Murphy and Tabish financed their defense out of cash and other assets stolen from Binion.

Knudson has maintained his conduct as a lawyer for Murphy and Tabish has been proper, and he has accused investigators of harassing him during the well-publicized homicide investigation.

His name has surfaced throughout the probe.

He once stepped forward to provide Murphy and Tabish with a partial alibi the day of Binion's death, saying he had lunch with the two at the Z'Tejas Grill on South Paradise Road.

Knudson also helped Murphy post bail for Tabish after he was arrested on Sept. 19, 1998, for trying to steal Binion's $6 million silver fortune that was buried in an underground vault in Pahrump.

And the lawyer went with Murphy to the state Gaming Control Board the morning of Binion's Sept. 22, 1998, funeral to help her lay the groundwork for her defense in Binion's death.

Earlier this year, Jason Frazer, a former Tabish business associate told prosecutors that Knudson acted as a courier for Tabish passing Frazer jailhouse notes during a plot to payoff alibi witnesses in the murder case.

Knudson later denied any knowledge of the plot.

And David Mattsen, charged with Tabish in the theft of the Pahrump silver, has told the Sun that Knudson was in a car outside of earshot the day after Binion's slaying, when Tabish told Mattsen it was "over."

Mattsen has tried to strike a deal with prosecutors, who are skeptical of his story.

Knudson denied being present during any conversation between Tabish and Mattsen on Sept. 18, 1998.

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