Appeal Court Refuses to Free Hunter From Jail : Convicted: J. David investment scandal figure will remain behind bars until her February sentencing.

Nancy Hoover Hunter, convicted earlier this month in San Diego federal court of four counts of tax evasion, must remain in jail pending formal sentencing in February, a federal appeals court has affirmed.

Hunter failed to convince the court that there was no risk she would flee should she be freed on bail, a three-judge panel of the U.S. 9th Circuit Court of Appeals said in a three-sentence ruling issued late Tuesday in San Francisco.

U.S. District Judge Earl B. Gilliam ordered Hunter to await sentencing at the federal Metropolitan Correctional Center in downtown San Diego immediately after she was found guilty Dec. 11 of the four counts of tax evasion.

The jury that convicted Hunter of those four counts also acquitted her of another tax-related charge but deadlocked on 192 other counts that centered on her role as a top executive in the La Jolla investment firm J. David Co. from 1979 to 1984.

In all, investors lost about $80 million in the J. David affair, a giant Ponzi scheme in which prosecutors alleged that Hunter played a key role. The 192 counts stemmed from Hunter’s alleged involvement in the Ponzi scheme, a pyramid in which money from new investors is used to pay off earlier investors.

Hunter’s defense lawyers contended she was blinded by her love for the firm’s founder, J. David (Jerry) Dominelli, and was unaware of any illegal activities. Dominelli pleaded guilty in 1985 to four counts of fraud and tax evasion in connection with the Ponzi scheme and is serving a 20-year sentence in federal prison.

Hunter’s trial, which began March 28, is believed to be the longest-running criminal case in the history of the San Diego federal court. Hunter, 51, a former Del Mar mayor, faces up to 20 years in prison, or five years on each of the counts, and is due to be sentenced Feb. 20.

Her lawyers, Richard Marmaro of Los Angeles and Robert Brewer of San Diego, had urged the federal appeals court to release Hunter on bail pending sentencing, saying she had given no indication she would flee while under indictment for three years and during an eight-month trial.

Sending her to jail without bail, the lawyers said, was “cruel and smacks of punishment.”

The appellate judges were unconvinced, however, saying only that they backed Gilliam’s move because Hunter had failed to show by “clear and convincing evidence” that she was not a flight risk.

The ruling was signed by Judges Cecil F. Poole, Dorothy W. Nelson and Edward Leavy. There was no indication who wrote the short order.

Hunter faces retrial on the 192 counts, also due to begin Feb. 20. After that trial is over, she faces a separate, 56-count indictment charging her with conspiracy and using the mails to sell unregistered securities.

Gilliam has imposed a gag order on lawyers involved in the case that prevents them from discussing it with reporters.