Records: Rhodes sought payment for NLV property

Diana Sahagun

Wednesday, Oct. 11, 2000 | 11:14 a.m.

City and court records show that a receipt for a hand-held computer -- which triggered an insurance fraud indictment against North Las Vegas Councilman John Rhodes -- was submitted for reimbursement to both the city and Rhodes' personal insurance company.

The receipt originally caught the eye of insurance investigators for other reasons -- the date of the receipt for the Palm Pilot did not match up to that of an alleged burglary at Rhodes' home.

Rhodes claimed to his insurance company that he bought the Palm Pilot a few days after an alleged burglary at his East Diana Drive home, as a replacement for a hand-held computer that was stolen from the home.

The reported burglary was in September 1998.

Because Rhodes submitted an undated copy of the receipt to the insurance company, investigators went to the place of purchase -- Circuit City -- and obtained the date.

The $460 store receipt for the Palm Pilot and a battery was dated July 24, 1998.

After comparing the date of the store receipt with the date of the burglary, State Farm investigators contacted the insurance fraud division of the state attorney general's office, and Rhodes was ultimately charged with two counts of insurance fraud.

In reviewing city records relating to Rhodes' expenses, the Sun found that the $460 Circuit City Palm Pilot receipt also had been submitted by Rhodes to the city for reimbursement in July 1998.

Then-City Manager Pat Importuna approved the reimbursement, and a city check for $460 was cut for Rhodes, according to city records. The city paid for the Palm Pilot after Rhodes said he needed it for his public duties.

After reviewing court records, the Sun found that this same receipt was submitted by Rhodes to State Farm two months later. Rhodes claimed to State Farm that this Palm Pilot, which records show was actually city property, was purchased by him as a replacement for a Newton Macintosh hand-held computer that was taken in the alleged burglary.

Contacted Tuesday, Rhodes said he had no comment on the receipt because the matter is still in the courts.

Deputy Attorney General Greg Hojnowski, who is prosecuting the case against Rhodes, told the Sun Monday that he had not been aware that Rhodes had previously submitted the Palm Pilot receipt to the city and had received full reimbursement.

In another twist, two weeks before the city reimbursed Rhodes for the Palm Pilot, the councilman also had reported a theft at his City Hall office. Among the items stolen was a hand-held computer, Rhodes claimed on a police report.

Rhodes' office is situated to the rear of the City Hall Council Office, down a hallway flanked by two secretaries.

According to police reports, Rhodes claimed he returned from a mid-afternoon meeting July 15, 1998, and reported that his black, leather portfolio bag had been taken from his council office. Rhodes reported that his wallet, checkbook, $325 in cash and a $500 Macintosh Newton hand-held computer had been in the bag. He told police that he was uncertain whether he had locked his office.

According to Rhodes' inventory sheet following his reported home burglary Sept. 22, 1998, furniture and other items were stolen, including a Macintosh Newton hand-held computer.

Grand jury transcripts reveal that Rhodes testified he could not locate the Newton receipt, so instead he provided State Farm with a receipt for a replacement computer, the Palm Pilot.

Rhodes testified that he had purchased the Palm Pilot "a few days after the burglary" from Circuit City to replace the Newton.

State Farm Investigator Scott Chadwick testified that it is common practice to satisfy claims based on the costs of replacement property. In this case, however, records indicate that the Palm Pilot was purchased before the burglary, rendering it ineligible to be considered as a replacement.

When Rhodes turned in the receipt to State Farm, it was a photocopy and did not have a date on it, which sent up a red flag to investigators, according to grand jury transcripts.

"Anytime that documents are submitted that either cannot be verified ... or come in looking to be altered or are all in photocopy where the insured doesn't have the original of that document...can raise some questions," Chadwick testified.

According to testimony, Circuit City supplied State Farm with the original receipt for the Palm Pilot, which was dated July 24, 1998 -- two months before the alleged burglary.

Investigators later questioned Rhodes how the receipt could have predated the alleged burglary, of which Rhodes gave three responses under oath.

Rhodes first testified that he had gotten two receipts mixed up, and that the July 24, 1998, purchase was actually a Palm Pilot he had bought for his girlfriend, Alesia Boone.

Boone later testified she had never received a Palm Pilot or any other hand-held computer from Rhodes.

Rhodes then testified that he had bought a second Palm Pilot for himself after the alleged burglary, and had given that receipt to his former boss, Herman Ross, who had reimbursed him.

Ross, who headed the insurance company that employed Rhodes at the time, later testified that he had never reimbursed Rhodes for a Palm Pilot.

Rhodes was unable to produce a second receipt, and later testified that there was no receipt because he had purchased the Palm Pilot from a man on the street.

State Farm referred the case to the attorney general's office Nov. 10, 1999. The attorney general's office filed two counts of felony of insurance fraud against Rhodes May 5.

Rhodes was charged with two more felony counts of insurance fraud Aug. 4, relating to an alleged burglary to his home in July 1997. Rhodes reported to State Farm that a Rolex watch, a women's engagement ring and diamond wedding band and a VCR were stolen from his home. State Farm paid Rhodes $5,250.

If Rhodes is convicted of a felony, he would be required to step down from his council seat.