Silberman--Was He on Financial Ropes?

While Richard T. Silberman allegedly was pressing for a second money-laundering deal with federal agents who said they represented Colombian drug traffickers, the San Diego businessman was imploring friends and associates to help him sell his floundering gold mining company or raise the cash needed to save it, according to sources close to Silberman and the firm.

Federal securities reports and state court records also show that Silberman’s company, Yuba Natural Resources, was deeply in debt and facing lawsuits from creditors and a $515,000 judgment from the federal government for dredging for gold on land it did not own. In addition, Silberman and his wife, San Diego County Supervisor Susan Golding, have disposed of much of their extensive real estate holdings in recent years, according to disclosure reports filed with the county by Golding.

Together, the documents and interviews suggest that Silberman, who was commonly thought to be one of San Diego’s wealthier businessmen, may actually have been struggling to keep his financial affairs afloat during the period that the FBI alleges he offered his services to conceal the source of hundreds of thousands of dollars in illicit funds.

“He was tenacious about this thing,” a friend of Silberman said about the businessman’s efforts to obtain help for his company. “He did not want to see this thing go sideways. I don’t think he wanted a failure. He was reaching out to anybody and anyone who could help him.”

In early December, Silberman, allegedly having already completed a $100,000 money-laundering transaction, asked an undercover FBI agent if he could, as the FBI put it, “do another deal” before the end of the year, according to the federal affidavit. In a tape-recorded conversation, Silberman said he hoped that “by now you’re satisfied that it’s first class . . . and, uh, there’s a lot more potential if we got active,” the affidavit says.

The affidavit said Silberman “pressed” the undercover agent to obtain more money to launder through his company before he left for the Orient on Dec. 15. He allegedly made the overtures even after being told repeatedly that the money was coming from Colombian drug dealers.

It was also in December that Silberman asked Alan Aiello, Rebecca Wood and Llewellyn C. Werner to join the company’s board of directors and help find someone to invest cash in the troubled firm or to buy it, according to a source close to Silberman who asked not be identified.

Aiello, a former Bank of America executive, and Wood, an accountant, are associates of Larry Lawrence, owner of the Hotel del Coronado and a longtime player in California Democratic politics and former member of the company’s board. Werner served in state government with Silberman under former Gov. Edmund G. Brown Jr. and is now a merchant banker in Los Angeles.

According to two sources who have dealt with the company, the new directors reportedly were working on deals to sell the company’s assets. The status of those transactions is unclear since Silberman’s arrest last Friday.

Aiello and Wood could not be reached for comment Thursday. Werner referred all inquiries to Los Angeles attorney Marshall Mintz, who was retained by Yuba Natural Resources in the aftermath of Silberman’s arrest. Mintz declined to comment.

In a statement Thursday, the company said it was not involved in any of the alleged transactions involving Silberman and announced that the three new directors, Aiello, Werner and Wood, will serve on a special audit committee to review the transactions.

There is no indication that any of the three new directors were aware of Silberman’s alleged relationship with drug dealers. Nor is it clear whether they knew of the depth of the financial problems besetting the company, which attempts to mine gold, aggregate and silica on 9,900 acres along the Yuba River, about 45 miles east of Sacramento.

Yuba County public records and the company’s own public disclosures suggest that the property has been more a cash sinkhole than a mother lode. Yuba Natural Resources has lost millions under Silberman’s management, is virtually out of cash, and is now embroiled in a variety of legal disputes with its neighbors, lenders, the federal government and the Yuba County tax collector.

Last year, the company was cited for mineral trespass by the U.S. Department of Interior’s Bureau of Land Management for mining 120 acres that belong to the government. Yuba agreed to pay the government $515,000 over five years, but on April 1 of this year, it missed paying the first $130,000 installment, said Dean Swickard, the bureau’s area manager in Folsom.

“They welshed on the first payment,” Swickard said. “I told (Yuba President) Peter Jensen on April 7 that they would have to pay up soon or we’d be have to take stronger steps.” Swickard declined to say what those steps might be but asserted that the department has the power to make arrests and to close down all mining on the property.

The company also is in default on two loans secured by trust deeds on the property, according to court records.

Yuba was sued on April 10 for $1.8 million in Yuba County Superior Court by a Sacramento company called U.S. Machinery, which leased Yuba silica mining and processing equipment in 1982. U.S. Machinery President Herbert Caplan said its equipment lease with Yuba expired in September, 1987, at which time Yuba was supposed to have returned the equipment or purchased it. Yuba has done neither, and U.S. Machinery is asking for $1.5 million in punitive damages and $300,000 in monetary damages, according to the company’s lawsuit.

In the suit, U.S. Machinery accuses Yuba of knowingly selling its equipment to a third party. “It’s like someone taking your car and turning around and selling it,” Caplan said in an interview.

Yuba is also delinquent on about $12,000 in property taxes due in December, 1988, according to public records.

The company reported losing $6.5 million during the four fiscal years from 1984 through 1987 and would have lost money in 1988 had it not been for the $5-million sale of land and mineral rights. For the first nine months of the current fiscal year, Yuba is running a $2.6 million deficit.

Times staff writers Barry M. Horstman, Jenifer Warren and Ralph Frammolino also contributed to this story.