Slain Santa Ana Engineer Had Bilked Military

James E. Busher, a 48-year-old engineer who was found shot to death outside his Santa Ana apartment 3 weeks ago, was a convicted racketeer who had just served 4 years in federal prison for embezzling more than $300,000 from the military, federal authorities said this week.

Upon his release from the federal penitentiary at Boron in San Bernardino County about 6 months ago, Busher had moved to Santa Ana, apparently to begin life anew, said his attorney, George J. Mendelson of Rockville, Md. He began working as an engineer for the Gorham Co., a general contracting firm in Corona, and, according to neighbors, kept to himself.

Then, in the early morning hours of April 19, Busher’s body was found lying face down on the sidewalk in the 1900 block of South Oak Street, next to his 1979 Volvo. Police said Busher had been shot several times in the head and upper body. Neighbors in the St. Andrew Trailer Park said they heard several shots, followed by the sound of a speeding car.

Since that time, Santa Ana police spokeswoman Maureen Thomas said, the department has assigned a number of investigators to the case. She would not comment, however, on what role, if any, Busher’s racketeering activities might have had to do with his death. Thomas said police are investigating “various leads,” but have no suspects in custody.

Busher, a California native who operated a construction business in Hawaii for about 12 years, was indicted in Honolulu in September, 1984. He was charged with racketeering, mail fraud, tax evasion and several lesser counts concerning his company’s performance on various construction contracts.

The contracts were mostly for the U.S. Department of Defense, and included such projects as the rehabilitation and reroofing of the headquarters building of the commander-in-chief of the Pacific Fleet and repairs to military housing projects, according to federal officials.

Busher said in court records that his business, called ATL Inc., performed 14 defense contracts totaling about $27 million. But only contracts totaling about $335,000 were the subject of indictments brought against him and his secretary-treasurer, Diane L. Miller, according to the records.

Among other things, Busher’s company got in trouble for making subcontractor payments to J.W. Contracting Co., although the firm performed no work, according to court records. Both ATL Inc. and J.W. Contracting were Nevada corporations that Busher controlled.

Busher and Miller were convicted in a jury trial. Busher was sentenced to two concurrent 4-year prison terms. Miller was given probation.

The Navy, subsequently, barred Busher and Miller from receiving further federal contracts. The U.S. Justice Department also seized the assets of ATL Inc. and J.W. Contracting under the federal Racketeer Influenced and Corrupt Organizations Act, known as RICO.

The government also seized some property Busher owned on the Nevada side of Lake Tahoe, said Robert Matsumoto, a Honolulu attorney and court-appointed trustee for Busher’s assets.

The U.S. government also filed a civil lawsuit against Busher, seeking still more reimbursement. The suit was pending at the time of Busher’s death, as were a number of others that had been filed by Hawaii subcontractors who claimed they had not been paid for work on Busher jobs, said Mendelson, his attorney. One Honolulu subcontractor has alleged that Busher owes him more than $200,000.

“Busher certainly wasn’t too popular here,” Matsumoto said from his Honolulu office Friday.

The U.S. Ninth Circuit Court of Appeals in San Francisco refused to overturn his conviction. The court also upheld the government’s seizure of all his construction interests.

In fact, the Ninth Circuit issued its denial of his appeal on April 7--only 12 days before Busher’s death.

In his appeal for return of his property, Busher pleaded in court documents that the government’s action was “cruel and unusual” because his two companies were worth far more than the amount he had been convicted of stealing.

The appellate court concluded, however, that while ATL’s net worth was stated in a 1984 balance sheet as $1.1 million, it had outstanding tax and other liabilities that reduced its worth to only $200,000. And while Busher claimed J.W. Contracting was worth more than $1 million, government investigators found that it was worth no more than $220,000.

At the time of his death, Mendelson said Busher had practically no assets.