SANTA ANA -- An announcer for the Los Angeles Clippers pleaded not guilty to stealing $735,000 from an elderly friend in a failed development deal.
Mike Smith, 44, of Laguna Hills, is accused of duping a 65-year old golfing buddy to use his paid off home as collateral for a $735,000 loan for the investment project.
Smith is charged with grand theft and is also charged with a sentencing enhancement for loss over $100,000 and property damage over $200,000 which could result in a mandatory prison term if he is convicted.
Orange County district attorney's spokeswoman Farrah Emami says Smith is free on $25,000 bond.
A pretrial hearing is scheduled for Feb. 5, the same day prosecutors plan to conduct an examination of the alleged victim, a retired school teacher who suffers from an inoperable brain tumor.
Smith's business partner, Bruce Furst, 57, also of Laguna Hills, is faced with the same charges.
They are accused of persuading a friend into using his home for collateral on a $735,000 loan to finance a Dana Point development deal.
The market collapsed, the deal went sour and the victim is expected to lose his home.
Defense attorney Dyke Huish told reporters that Smith and Furst borrowed money from the retired schoolteacher for what they all hoped would be a profitable development of three homes in Dana Point.
The deal fell through in part because of the economy and the collapse of the housing market, Huish said.
Smith and the retired teacher have been close golfing and surfing friends for years, Huish said, adding that his client has been trying to repay the loan.
"He wants to pay it back. He intends to pay it back," Huish said. "This was a business deal, not a crime."
Deputy District Attorney George McFetridge said Smith committed a crime when he made several false statements to induce the retired school teacher to invest in the project. .
The Orange County District Attorney's Office reported that the alleged victim at first declined in invest in development project, but eventually agreed to put up his Dana Point residence as collateral for a $735,000 loan after Smith and Furst lied and told him the loan was safe and 100 percent guaranteed.
The project didn't pan out, prosecutors said, and the victim wasn't repaid.
Once the home was put for collateral, the victim was required to begin making mortgage payments of $7,200 a month, said Farrah Emami, spokeswoman for the District Attorney's Office.
Smith and Furst failed to make mortgage payments toward the victim's home, which was another promise, Emami said.
The alleged victim eventually contacted the Orange County District Attorney's Office in July 2009 for help.
Smith and Furst face up to five years in prison if convicted. Furst posted bail Monday.
Smith played for the Clippers and Boston Celtics before becoming a broadcaster.Copyright © 2014, Los Angeles Times