Friday, Jan. 16, 2004 | 11:02 a.m.
Because they relate to a developing investigation, certain conversations caught by FBI wiretaps will not be immediately given to the attorneys representing local politicians charged with trading political influence for money and gifts from a local strip club owner.
For the strip club corruption case, authorities have about 90,000 wiretap intercepts from Las Vegas and San Diego, and almost all of them will be in the discovery materials that will be turned over to defense lawyers in the next two weeks, Assistant U.S. Attorney Dan Schiess said at a Thursday hearing.
But, Schiess also told U.S. Magistrate Lawrence Leavitt, "We will withhold 10 to 15 conversations at this time because they relate to an ongoing investigation. As soon as the investigation advances we will release those."
Since the federal indictments against Clark County Commissioner Mary Kincaid-Chauncey and former Commissioners Lance Malone and Dario Herrera were released on Nov. 6, speculation has spread that the political corruption investigation -- which also includes former strip club owner Michael Galardi and former Commissioner Erin Kenny -- could extend to others.
The FBI has maintained that the investigation is ongoing.
Seventy thousand wiretapped conversations were intercepted from five lines in Las Vegas over the course of the investigation, and another 20,000 intercepts were gleaned in San Diego. Along with the wiretap summaries there are also surveillance videos, photographs financial records and Clark County Commission records.
Schiess said there are also 280 audio cassettes and compact discs of conversations recorded by a cooperating witness who was wearing a recording device.
The witness, whom Schiess did not name, worked at one of Galardi's clubs in Las Vegas and his San Diego club during the investigation that resulted in 18 months of wiretaps in Las Vegas and 11 months in San Diego.
The wiretap affidavits and other discovery materials remain sealed from the public. The attorneys can share the information with their clients, but a protective order bars them from sharing it with anyone else.
Because of the amount of discovery material Leavitt vacated the trial date scheduled for Tuesday and reset it for Aug. 17 before U.S. District Judge Larry Hicks. At the request of Schiess and the defense attorneys, Leavitt set a status check on the case for April 26.
"A failure to grant a continuance at this point would deny a reasonable amount of time for effective preparation by the attorneys," Leavitt said.
Jerome DePalma, who along with Dominic Gentile represents Malone in the case, said that he felt the trial date could be continued again because of the volume of materials that needed to be reviewed.
"With 90,000 intercepts there is no way I can give a seat-of-the-pants estimate on the time it will take," DePalma said.
Malone was the only defendant to appear at the hearing.
David Brown, who along with Eric Goodman represents Herrera, said that he has already begun to go through some of the material that Schiess has provided.
"It's extremely voluminous," Brown said. "The government has had this material for 18 months and they are still going through it, so you can imagine what we're going through."
Richard Wright, who represents Kincaid-Chauncey, said that although there is a lot of discovery his client wants to go to trial as soon as possible.
He said he thinks the number of recordings that pertain to Kincaid-Chauncey "is minimal." Schiess said he plans to introduce only between 500 and 700 of the intercepts as evidence, and that transcripts of those conversations will be provided to the defense attorneys and the court.
Kincaid-Chauncey, Malone and Herrera have all pleaded not guilty in the case.
Federal prosecutors allege the politicians took thousands of dollars in exchange for their votes and use of their influence to help Michael Galardi's Las Vegas strip clubs Jaguars, Cheetahs and Leopard Lounge.
The indictment charges Kincaid-Chauncey, Herrera and Malone with one count each of conspiracy to commit wire fraud, and 14 counts each of wire fraud. In addition Malone was charged with racketeering, Herrera faces eight counts of extortion, and Kincaid-Chauncey faces four extortion counts.
Galardi and Kenny have already pleaded guilty in the case, and are cooperating with authorities in the ongoing investigation.
Kenny pleaded guilty to one count of conspiracy to commit wire fraud and two counts of wire fraud, and Galardi pleaded guilty to a racketeering charge.
Galardi has also agreed to forfeit $3.85 million to the government, pay $200,000 in restitution to both the city of Las Vegas and the county, and give up ownership of his clubs. Kenny has agreed to forfeit $70,258.53.
Drawing largely from the wiretaps, prosecutors allege that Galardi had been trying to bribe politicians, funneling $200,000 to $400,000 to commissioners. Galardi's plea agreement says he tried to bribe public officials between 1994 and 2003, but the indictment focuses on events from 1999 to 2003.
Prosecutors say the commissioners voted to change an ordinance regulating the touching at strip clubs and changed zoning ordinances to help Galardi's clubs. The indictment alleges that the commissioners also "controlled and harassed" Galardi's competitors and voted to deny a promotion for a county employee who didn't move quickly enough on a license for one of Galardi's businesses.
If convicted Malone could face up to five years in prison on the conspiracy charge and up to 20 years on the racketeering charge. If convicted on all charges Malone could forfeit $1.45 million to the government.
Herrera and Kincaid-Chauncey could face maximum sentences of five years in prison on the conspiracy charges and 20 years on each of the wire fraud and extortion charges. Kincaid-Chauncey could be fined up to $100,000 and Herrera could be fined up to $170,000.
The investigation became public on May 14 when the FBI raided Galardi's clubs and Las Vegas office. On the same day a parallel investigation in San Diego became public when the Galardi-owned Cheetahs there and the offices of three San Diego city councilmen were raided.
Galardi pleaded guilty to one count of conspiracy to commit wire fraud in the San Diego case, which involves illegal campaign contributions to public officials in an attempt to loosen strip club regulations in that city.
The San Diego investigation has also resulted in the additional indictments of Malone and the three San Diego city councilmen.
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