Wiretapped Phone Calls OKd as Evidence in Silberman Trial

The thousands of wiretaps that led to money-laundering charges against San Diego businessman Richard T. Silberman were conducted legally, a federal judge decided Thursday.

U.S. District Judge J. Lawrence Irving also rejected complex and technical challenges by Silberman’s defense lawyers to federal money-laundering laws and to the way federal prosecutors drafted the indictment itself.

Irving’s ruling on the wiretaps, which followed a decision he issued last Friday approving a new “roving wiretaps” law, clears the way for federal prosecutors to introduce months’ worth of secretly taped phone calls at Silberman’s trial.

The opinion also marked the end of the major pretrial defense effort to strike down any of the seven counts against Silberman, who was a top aide to Edmund G. Brown Jr. when he was governor.

Silberman, reputed mobster Chris Petti and three other men are accused of laundering $300,000 in cash that an undercover FBI agent allegedly characterized as the proceeds of Colombian drug-trafficking.

Silberman, 60, is due to stand trial on April 10. Petti and the three others are scheduled for trial on July 17.

Prosecutors have made it clear that their strategy at Silberman’s trial will rely heavily on the use of various tapes from among the thousands recorded by FBI agents from July, 1987, through early 1989. Agents listened in at various office and home phones as well as at a number of pay phones in San Diego County.

Irving’s ruling Thursday stemmed from a defense contention, detailed at a hearing in February, that the tapes were unnecessary and therefore illegal.

The surveillance that eventually led to Silberman began with information on Petti that a confidential informant, Robert Benjamin, had provided since September, 1986, Petti’s lawyer, Oscar Goodman of Las Vegas, said at the February hearing.

By July, 1987, when federal Judge Gordon Thompson Jr., the chief federal judge in San Diego, first authorized what developed into a series of wiretaps, Benajmin had given prosecutors so much information about Petti that there was no need for any taps, Goodman said.

A key component of that information, according to prosecutors, was an alleged scheme by the Chicago mob to take over the gaming operations of the Rincon Indians in San Diego County. The money-laundering operation that prosecutors have alleged was linked to the Indian gambling investigation through Petti, the original target of the FBI probe.

In his ruling, Irving said that the taps were necessary. Benjamin’s credibility as a trial witness was suspect because he has been convicted of a number of felonies, Irving said. In addition, Benjamin was not--nor could he have been--at every important conversation, the judge said.

Irving also rejected a defense claim that FBI agents misled Thompson in the sworn statements they filed detailing why they were asking for wiretaps, saying the agents did not provide false information.

Last week, Irving had approved the taps of the various public phones, which were conducted under a 1986 law authorizing what prosecutors call a “roving wiretap.” Irving, the first judge in the nation to consider the legality of the new law--which involves monitoring multiple phones--said there were no constitutional defects with the law, as defense attorneys had claimed.

In other rulings in Thursday’s 39-page opinion, Irving turned down a defense request to dismiss the first count of the indictment, which charges Silberman and the four others with conspiring to launder money.

Silberman’s lawyers had said that the charge was flawed because the conspiracy law requires suspected criminals to “know” that the money prosecutors contend they laundered is the proceeds of illegal activity. Because the $300,000 prosecutors charge the five men laundered was provided by an FBI agent, it was not “dirty” money, defense lawyers said.

The indictment charges the five men with conspiring to launder money they “believed” was the proceeds of illegal narcotics trafficking, Irving said. That belief was an “acceptable substitute” for knowledge, he said.

Irving also denied a defense request to dismiss the fourth count of the indictment, which details the first of the two transactions involving the $300,000, the alleged laundering in late 1988 of $100,000.

Prosecutors contend that $45,000 of that $100,000 was laundered through a Hong Kong company by a series of transactions involving cash deposits, check deposits and wire transfers--without the paper work necessary for any of the transactions.

A federal law requires the filing of a report for any transaction over $10,000. Defense attorneys had maintained that the law is aimed only at transactions involving cash.

Irving said he disagreed. The law, he said, was designed in response to what law enforcement officials call “smurfing”--cash conversion schemes that break down larger sums of money into transactions involving less than $10,000 apiece.

If the law was aimed only at cash, it would say so, Irving said. But there was “no indication” that the law was intended to prohibit “only smurfing in its most basic form and not prohibit more sophisticated structuring schemes,” he said.

Both Asst. U.S. Atty. Charles F. Gorder, the lead prosecutor in the case, and Silberman’s primary defense lawyer, James Brosnahan of San Francisco, declined Thursday to comment on Irving’s rulings.

An FBI report released Feb. 16 alleges that Silberman confessed to the money-laundering scheme.

In the wake of Silberman’s attempted suicide last month, it is not known whether the trial will begin as scheduled April 10.

Silberman disappeared from San Diego on Feb. 15 and was found unconscious two days later in a Las Vegas hotel room. After writing a suicide note, he tried to kill himself with an overdose of sleeping pills, according to his wife, Susan Golding, a San Diego County supervisor.