Ex-Councilman Found Not Guilty of Fraud Charges

Former Westminster City Councilman Guinn (Gil) Hodges was acquitted Thursday of loan fraud charges by a Los Angeles federal court jury.

Hodges, who successfully appealed his 1983 conviction on charges of falsely verifying information on real estate loan documents, was retried on the same charges earlier this week.

A spokeswoman for Hodges’ attorney, Roger J. Agajanian, said Hodges and Agajanian were “very happy” about the verdict, which the jury reached after only 30 minutes of deliberation.

Assistant U.S. Atty. Sharon McCaslin, who tried the case twice, was unavailable for comment.

Defense witnesses told the jury that Hodges was not involved in the fraudulent loan operation. They said the loans were arranged by Hodges’ late brother Barclay and Barclay’s associates. In 1982, Barclay Hodges was shot to death in a cocktail lounge at John Wayne Airport.

Government documents filed in the case alleged that Barclay Hodges attempted to use the real estate scheme to launder profits from the sale of cocaine.

Gil Hodges said he merely answered the phone in a real estate office and was not aware of any crimes being committed.

In April, 1983, Gil Hodges and four others were indicted on charges that they fraudulently obtained about $1.2 million in federally insured bank loans in 1981 and 1982. They allegedly used the money to buy seven Huntington Beach homes.

Seven Others Plead

In 1983, the other defendants pleaded guilty or no contest, but Hodges was tried and convicted. He resigned his City Council seat in September, hours before he was sentenced to 18 months in prison, with all but three months of the sentence suspended, plus five years on probation and a $2,000 fine. Hodges had been a councilman since 1977.

In September, 1985, the U.S. 9th Circuit Court of Appeals reversed his conviction, saying that although there was evidence to support the guilty verdict, U.S. District Judge David V. Kenyon erred by allowing the jury to hear prejudicial testimony implicating Hodges in an alleged extortion scheme.

The second trial was before U.S. District Judge A. Andrew Hauk.

Before the verdict was announced, Hodges said he was confident that he would be exonerated. In a January interview, Hodges, 42, said he planned to take the bar exam and pursue a law career after the trial.