Hunter Enjoyed ‘Joy Ride’ With Dominelli, U.S. Prosecutor Claims
Nancy Hoover Hunter was intimately involved in the giant fraud perpetrated by the failed La Jolla investment firm J. David & Co., knew about it at every step along the way, and created false documents to lure investors, a federal prosecutor argued Friday.
Hunter enjoyed a “4 1/2-year joy ride” with J. David (Jerry) Dominelli, the founder of J. David, Assistant U.S. Atty. S. Gay Hugo said, adding that the ride was fueled by money they had gotten from investors who had been “enticed by false track records.”
Once enticed, about 1,500 investors were lulled into believing the $80 million they had invested in J. David over those 4 1/2 years was earning fabulous returns because they were mailed “monthly, fictitious, non-existent trading results,” Hugo said.
“That joy ride came to a screeching halt in 1984,” she said.
That summary of the case, meanwhile, was about all that Hugo got to tell jurors Friday as she began her closing argument in Hunter’s 197-count federal tax-evasion and fraud trial. Hugo ran out of time as she began to go over what she called the highlights of eight months of evidence.
The charges against Hunter stem from her role as a top executive in J. David from 1979 until February, 1984, when company checks began to bounce and nervous investors forced the firm into bankruptcy.
Prosecutors have contended since the trial began in March that Hunter played an active role in the J. David affair, a huge Ponzi scheme. Her defense attorneys have maintained that she was blinded by her love for Dominelli and was unaware of any illegal activities.
Dominelli pleaded guilty in 1985 to four counts of fraud and income-tax evasion and is serving a 20-year sentence in federal prison.
Closing arguments in Hunter’s case had been scheduled to begin early Friday morning, but last-minute witnesses testifying to minor details delayed the start of Hugo’s argument until late in the day.
Hugo began with her summary of the case, then described Hunter, saying she was “sophisticated, well-traveled and intelligent.”
“Here is a woman who, when she sets her mind to something, she accomplishes it,” Hugo said of the former Del Mar mayor.
Next, Hugo began her review of the sets of charges against Hunter. But U.S. District Judge Earl B. Gilliam Jr. called court to a close after Hugo had gotten through her claim that prosecutors had proven that Hunter, or someone acting at Hunter’s direction, used the mails to send investors the statements.
Use of the mails must be shown to prove mail fraud as well as fraud by a commodities pool operator, two of the sets of charges against Hunter.
Gilliam ordered that Hugo resume her argument Tuesday. Defense attorneys will follow Hugo, then the jury will get the case.
Because of court scheduling, however, only two days of trial are set for next week. Jury deliberations are not likely to begin until the week after.
Gilliam said Friday that he had decided not to sequester the jury, though he had “seriously considered” such a move because of press attention to the case.
