Supervisors OK $385,000 for Defense in Fraud Case : Courts: The two defendants have been declared indigent and given public lawyers despite their apparent affluence.

The Ventura County Board of Supervisors, convinced that it had no other choice, agreed Tuesday to pay $385,000 in accounting and investigative fees to defend two Thousand Oaks businessmen charged in the biggest fraud case in county history.

The supervisors, responding to a request by Dist. Atty. Michael D. Bradbury, also directed board lawyers to see if the county can garnish the wages and freeze the assets of defendants Olen B. Phillips and Charles J. Francoeur as the two await trial next year.

Both men hold high-paying jobs and own expensive homes, but a judge declared them indigent and granted them public lawyers in March because no private attorneys would take their complex case.

Phillips, a former real-estate financier, and Francoeur, an executive in the same firm, are charged with 81 counts of grand theft and securities fraud.

The men were indicted in February on charges that they bilked 21 investors out of more than $3 million. Their trial could last six months, attorneys say.

The supervisors balked two weeks ago at a request by court officials to spend the extra $385,000 on the Phillips and Francoeur case. Board members asked if they had any real options.

On Tuesday, they were told that they did not.

“There really is not an option here,” said Sheila Gonzalez, executive officer of the county courts. “One way or another, if the court orders that this has to be paid, it has to be paid.”

Edwin M. Osborne, presiding judge of Ventura County Superior Court, told the supervisors at a previous meeting that their refusal to approve the extra money would amount to denial of a fair trial.

The money is needed to help defense attorneys make sense of 27 filing cabinets, 350 boxes and a dumpster filled with unorganized documents, court officials said.

Osborne said a rejection of the court officials’ request might lead to a court order to pay the money or even dismissal of the charges. He said that trying the case without providing a proper defense would force an appellate court to overturn a conviction.

Court officials said the request is the largest in an indigent’s case in at least 10 years.

The supervisors finally agreed Tuesday to hire a team of accountants for $350,000 and investigators for $35,000, but to pay the money in installments and only after a careful review has determined that the expenses are justified.

It was a decision supervisors said they did not want to make, especially after several people who contend that they were defrauded by Phillips said they were outraged that the county would provide the extra money.

“I’m too old to cry, but that doesn’t mean I don’t hurt,” said Robert Bell of Granada Hills, who said he lost $200,000 to Phillips on the eighth month of his retirement.

Investor Ray Lahr of Malibu said, “It appears that the taxpayers, as well as the investors, are being victimized.” But Lahr asked the supervisors to provide the money so the case would not be dismissed.

The supervisors said they have been forced to deal with the same dilemma.

“I’m really frustrated,” Supervisor Vicky Howard said. She said she was bothered that the defendants could be classified as indigents and provided a free defense while living “high lifestyles . . . in their beautiful homes.”

Howard said she agrees with Bradbury, who said in a letter to the board that the Phillips and Francoeur case again raises the issue of whether affluent defendants should pay a share of defense costs as their cases progress to trial.

Bradbury asked the board to explore a change in state law that would force defendants who hold high-paying jobs--but who have been declared indigent--to be charged for part of their legal bills.

Phillips, an airline pilot, “makes about $150,000 per year,” Bradbury wrote, “lives in a home in Westlake valued at over $1 million, has a retirement account of over $335,000, has his own personal airplane and drives a Mercedes-Benz.”

Under current law, the county apparently cannot attempt to recover any of Phillips’ legal costs until his case has been decided, and that may be too late since he may then be a convict and no longer hold a job, Bradbury said.

Supervisor John K. Flynn asked County Counsel James McBride to find out if it is true that the county is barred from placing a lien on the personal property and real estate of affluent indigent defendants and garnishing a share of their wages while they are still working.

Even when Phillips and Francoeur’s trial is over, the county may have to stand in line with others to whom the defendants are indebted--including the victims of the alleged fraud, McBride said.

Gonzalez said defendants are declared indigent if an analysis of their assets and debts shows that they could not afford to pay private attorneys for the length of their trial. They cannot be forced to sell assets such as cars and houses before trial to pay a part of their defense, she said.

She said that the defendants have large outstanding debts, despite their apparent affluence.

“It can be a much larger and nicer home than you and I are sitting in, and a much nicer car than you and I are sitting in. . . . But this person can be in hock up to their eyeballs,” she said.

Board Chairwoman Maggie Erickson Kildee said, however, that she wanted to create a “working group” of county lawyers, judges, supervisors and court administrators to look at the issue of court-declared indigents.

“I think you have to be careful not to walk over somebody’s rights,” she said in an interview. “Yet, the cost to taxpayers is a clear issue we have to deal with.”

Erickson Kildee also said she wants the new committee to determine how much money could be saved if the county were to create a second public defender’s office to handle many of the cases that now go to a group of private lawyers.

The Times reported Sunday that county auditors have found in a preliminary audit that the county could save up to 60% of the $1.3 million that it now pays Conflict Defense Associates by using a new public agency for indigent cases.

Chief Administrative Officer Richard Wittenberg and Gonzalez told the board that they do not believe that the savings would approach the $750,000 cited in the draft audit.

But Wittenberg said he supports the second public defender’s office in concept and had, in fact, proposed such an office in 1989. At the time, the idea received little support from judges, who said CDA was doing a good job on indigent defense, Wittenberg said.

Wittenberg said the county has saved about $1 million a year since 1981 by using the CDA instead of an old system in which judges appointed private attorneys for individual indigent cases.