Columna Gets Probation in J. David Case

Parin Columna, a relatively unknown local carpenter who found himself in the public spotlight and criminally indicted for his work with fraud-ridden J. David & Co., was placed on probation Monday for three years and ordered to turn over at least two automobiles to the J. David bankruptcy trustee.

Ignoring a federal probation officer’s recommendation that Columna spend 90 days in custody, U.S. District Judge William B. Enright told Columna that terms of his probation included immediately returning “all property you have that belongs to the trustee . . . no ifs, ands or buts.”

The property includes a 1976 Porsche 914, a 1982 Ford pickup truck and a Honda generator.

Columna, described by his attorney as owing $130,000 and on the verge of bankruptcy, was also fined $1,000, payable over the next 12 months.

It was the first criminal sentence handed out in connection with the collapse in early 1984 of the J. David & Co. investment firm, which conned 1,500 investors into laying out about $200 million.

Company founder J. David (Jerry) Dominelli will be sentenced June 24 after pleading guilty to four federal felony counts of fraud and income tax evasion. He faces up to 20 years in federal prison.

Columna pleaded guilty March 21 to one misdemeanor count of criminal contempt of court. The confession related to Columna’s role in aiding and abetting Dominelli during his flight to the tiny Caribbean island of Montserrat in April, 1984, to avoid imprisonment.

Columna had been indicted with Dominelli on eight counts of bankruptcy fraud as well as the aiding and abetting charges.

As part of Columna’s plea bargain, Assistant U.S. Atty. Robert D. Rose agreed to drop the other charges and said that federal prosecutors would not oppose a probation-only sentence.

Columna also is embroiled in negotiations with trustee Lt. Gen. Louis Metzger over several items other than the automobiles, including the status of $39,500 that Metzger says should be returned but that Columna’s attorney maintains was a legitimate business expense of J. David & Co.

Columna received the $39,500 when he sold a Mercedes-Benz that belonged to J. David & Co. He deposited the money in Architura, a Del Mar architectural firm owned by Columna and other J. David officials, and paid out all but $10,000 of that.

The funds were used “to pay vendors on J. David projects,” said Michael J. McCabe, Columna’s attorney. “He didn’t benefit from any of this.”

Columna and his contracting firm were paid about $1.4 million for J. David projects in 1983, according to sources close to the case. Columna was in charge of the lavish remodeling of J. David’s opulent La Jolla offices, as well as the remodeling of San Diego Mayor Roger Hedgecock’s South Mission Hills house.

In court, McCabe criticized Metzger for telling the probation department that Columna had not cooperated in the trustee’s efforts to retrieve J. David & Co. assets.

McCabe outlined for Enright a “comprehensive proposal” made in November to settle Columna’s disputes but said, “I haven’t received any written reply” from the trustee.

After the hearing, Metzger said he had not responded to Columna’s offer because at the time he was negotiating with an insurance company that had insured J. David & Co. against fraud and that later paid the estate $4.5 million. “It wasn’t in our interests (at the time) to respond,” Metzger said.

Columna is trying to stave off bankruptcy, McCabe said, and has been forced to sell his Rancho Penasquitos home to avoid foreclosure. He has no savings and likely will try to land a “common laborer’s job” and start his life anew, McCabe told the court.

Columna was “an extremely unsophisticated human being” who “let his loyalty to Jerry Dominelli obscure his good judgment,” McCabe said.

“I’m sorry for the trouble I’ve caused numerous people,” Columna told Enright. “And I’m sorry for the troubled caused by J. David & Co.”