New Indictment Expected Soon in Silberman Money-Laundering Case

A new indictment in the complex money-laundering case involving prominent San Diego businessman Richard T. Silberman, reputed mobster Chris Petti and two others is due soon, prosecutors told a federal judge Monday.

Assistant U.S. Atty. Charles F. Gorder Jr. also told Judge J. Lawrence Irving that prosecutors expect to try the case under the new charges without calling a key informant, Robert Benjamin of Los Angeles, as a witness.

Benjamin was a longtime friend of Petti who acted as a go-between among Petti, Silberman and an undercover FBI agent during the government’s money-laundering “sting” operation, according to an affidavit prosecutors have filed in the case.

The current indictment charges the four men with laundering $300,000 an undercover FBI agent had portrayed as profits from Colombian cocaine trafficking. Named in those charges, along with Silberman and Petti, are Darryl Nakatsuka and Jack Norman Myers, both of Los Angeles.

The new indictment is expected within a month, Gorder said at Monday’s hearing, a “status conference” at which lawyers and judges usually tend only to housekeeping details. Gorder did not provide further details about the new--or “superseding”--indictment.

After hearing that prosecutors expect to bring new charges, Irving ordered that a Nov. 14 hearing, at which lawyers had expected to argue motions, be converted to another status conference. The judge has not yet changed the Jan. 16 trial date, but he said it appeared likely he would have to alter it after the new indictment is filed.

Gorder also disclosed at the hearing that he does not plan to use Benjamin as a witness.

The decision was a tactical one, Gorder said, since defense lawyers were asking for “all kinds of stuff” about Benjamin’s background “and I was saying they weren’t entitled to it because he was not on my list of witnesses,” Gorder said Monday after the hearing.

“Our present intention is to present other witnesses besides Mr. Benjamin, including the wiretapped conversations,” Gorder said after the hearing.

An affidavit filed by prosecutors in the case suggests that evidence against Silberman ranges from the wiretapping of more than a dozen telephones to videotapes of cash transfers and the negotiating sessions preceding Silberman’s arrest in April.

Case Against Benjamin

The same document explains Benjamin’s alleged role in the case. Last year, after Silberman allegedly proposed a laundering scheme to Petti, Petti set up a meeting with Benjamin, a longtime acquaintance and convicted felon who became a cooperating witness for the FBI in 1986, according to the affidavit.

In turn, Petti arranged for Silberman to meet another contact last November, according to the affidavit, which was filed to support search warrants for Silberman’s downtown San Diego office and two Los Angeles County offices. That contact was in fact an undercover FBI agent.

Another tactical consideration may have been at work in prosecutors’ decision not to include Benjamin on their witness list. Sparked by Benjamin’s testimony at Petti’s probation revocation hearing in May, defense lawyers were known to be eager to cross-examine Benjamin at the trial.

At the May hearing, Benjamin was at times admittedly confused and rambling during a cross-examination by Petti’s attorney, Oscar Goodman of Las Vegas. Asked after that hearing about his opinion of Benjamin as a witness, Goodman reportedly said, “You see--I’m smiling.”

All of the defendants have pleaded not guilty in the case. All but Petti, whose probation was revoked at the May hearing, remain free on bail pending the outcome of the trial.

The current indictment names all four men on two counts of laundering funds described as proceeds from narcotics sales and on one count of conspiring to launder money and avoid federal laws requiring the reporting of financial transactions involving cash of $10,000 of more.