Harmon trial begins on Monday

Jace Radke

Friday, Jan. 24, 2003 | 11:11 a.m.

When former Assemblyman Harley L. Harmon goes to trial Monday in federal court to face charges in connection with a multimillion-dollar mortgage investment scandal, at least one of his alleged victims will be there.

"When I learned what he had done to me, I told him that I would never forget. So I plan to be there on Monday to see him walk into court," said Dan Gray, a 72-year-old Henderson resident and retired barber, who says he lost most of his savings because of Harmon. "I had helped to put three of my grandchildren through college, and I have seven others I was planning to help, but now things have changed."

Harmon, 55, was indicted in April 2001 and charged with 71 counts of mail fraud after a joint FBI and Metro Police investigation into the operations of the now-defunct Harley L. Harmon mortgage company. If convicted on all counts, Harmon could face up to 355 years in prison and $17.75 million in fines.

The case will be tried before a jury in U.S. District Judge Philip Pro's court, and is expected to take about three weeks. Assistant U.S. Attorney Dan Schiess will try the case for the government, Frank Cremen will represent Harmon.

"He (Harmon) is looking forward to putting this behind him," said Cremen, who added that Harmon had no comments he wanted to make.

Harmon, who served as speaker pro tem of the Assembly in 1977 and as its majority leader in 1979, has a political lineage that extends back to his grandfather, Harley A. Harmon, a former chairman of the Nevada Public Service Commission. Harmon's father, Harley E. Harmon, served in the Assembly and on the Clark County Commission.

Investors say Harmon used his family name to lure investments in construction loans with promises of annual returns of up to 15 percent. He was able to draw prominent Las Vegans into investing.

But many investors soon learned they were placed in certain loans without their consent or discovered their money was used to pay off other investors.

The indictment focuses on 10 loans made between 1994 and December 1997. Harmon's company, which operated at 1108 S. Eighth St., was handling 44 separate loans involving $23.9 million from 694 investors when the Nevada Financial Institutions Division stripped the company of its license in December 1997.

The Sun subsequently reported that many investors had given Harmon money without knowing that he was under state investigation. That and other revelations reported in the Sun led the Nevada Legislature in 1999 to revise state mortgage broker laws aimed at giving investors more protection from potentially unscrupulous companies.

Assemblyman David Goldwater, D-Las Vegas, is now proposing a bill that would require licensing for Nevada mortgage brokerage agents and establish a commission to oversee the state Financial Institutions Division.

Gray, who is scheduled to testify for the prosecution in the case, said he is looking forward to a conclusion.

"Thank God this is finally going to trial," Gray said. "The man should do jail time. I'm hoping to get some closure out of this."

Gray and other investors got back about 30 cents on the dollar when the assets of Harmon's company were liquidated. One investor, Ellen Rozario of Las Vegas, said she received back only $130,000 of the $350,000 she invested. Gray didn't want to say how much he lost, but said that he lost two-thirds of his savings.

Among the prominent investors who dealt with Harmon were Las Vegas Convention and Visitors Authority President Manny Cortez, who invested at least $115,000, and State Ethics Commissioner Merle Berman, a former assemblywoman, who invested $205,000, according to documents that were filed in Clark County District Court.

Irv Bronstein, another retired investor, said he lost about $100,000 of his $300,000 investment.

"I remember going to the (Las Vegas) Country Club and Harmon coming by and patting me on the back," Bronstein said. "After the money started to disappear he'd still show up at the club. It ticked me off."