A jury today acquitted former auto maker John Z. DeLorean of all charges of racketeering, fraud and tax evasion in what the federal government alleged was a scheme to defraud investors in his failed car company of at least $8.5 million.
Dressed in his trademark blue suit, DeLorean said, "Praise God!" as the verdict was read before U.S. District Judge Julian Cook Jr.
With tears in his eyes, DeLorean embraced his defense lawyers, Howard Weitzman and assistant Juanita Brooks.
It was DeLorean's second major court victory in two years. He was acquitted on federal drug charges in Los Angeles in 1984.
DeLorean, 61, had been charged with 15 counts of racketeering, fraud and tax-law violations. He was accused of swindling more than 140 investors--including entertainers Sammy Davis Jr. and Roy Clark--out of funds raised to build his dream car, the DMC-12, in 1981 and 1982.
The jury of six women and six men announced its verdict about midway through its sixth day of deciding the fate of the former General Motors Corp. executive. The deliberations followed nearly seven weeks of testimony that included only one witness from the defense. DeLorean himself did not take the stand.
The jury foreman, a man in his 40s, unemotionally read "not guilty" as the court clerk asked him what the jury's verdict was on each of 15 counts.
Government prosecutors, entering into evidence nearly 4,000 pages of documents, had charged that DeLorean attracted investors with his dream of a stainless steel sports car but instead embezzled their money through a "nightmare" of financial manipulations.
Prosecutors said at least $8.5 million of the investors' money was shifted from a Swiss bank account to Panamanian and Liberian corporations and Swiss and Dutch banks before winding up in DeLorean's personal bank account in New York.
The defense contended that the funds were a loan from the late Colin Chapman, a British automobile executive whose company, Lotus Cars Ltd., did some engineering work on the DMC-12. Chapman died of a heart attack in December, 1982.
DeLorean remains entangled in more than 20 civil lawsuits stemming from the failure of his company, said one of his attorneys, Mayer Morganroth. Although the verdict in the criminal case may color the resolution of the civil lawsuits, the litigation will likely take years to settle, Morganroth said before the verdict was returned.
DeLorean became GM's youngest division head ever when he was named general manager of Pontiac in 1965 at age 40. He left to start DeLorean Motor Co. With $120 million in loans from the British government, he set up shop in Northern Ireland to make the DMC-12, a car he claimed would last "forever" and would protect drivers in crashes of up to 80 m.p.h.