Lawyer Suspected of Trying to Have Key Witness Slain : Crime: Authorities say Alan Michael Shapiro, accused of masterminding huge auto insurance fraud scheme, may have put out a contract on an associate.

A Santa Clarita lawyer jailed in one of the largest auto insurance fraud cases in California history is suspected of putting out a contract to kill the main witness against him, authorities said Monday.

The witness, who told investigators he had been taught how to stage auto accidents, is under protection in a secret location, court documents revealed.

Lawyer Alan Michael Shapiro, 42, was arrested last week--along with law partner Warren M. Finn of Marina del Rey and two alleged associates--and accused of masterminding a fraud ring that earned each of them millions in insurance settlements from staged accidents and exaggerated injuries.

In addition to insurance fraud and related money-laundering charges, Shapiro is under investigation on suspicion of solicitation to commit murder, said Richard Rosenthal, a Los Angeles County deputy district attorney.

“Based on the information we have, it’s a viable threat,” said Rosenthal, who works in the major fraud division. “We believe the man’s a crook, a liar and someone who is willing to violate the law.”

A lawyer for Shapiro, John A. Colucci, did not return several calls seeking comment. Shapiro and the three other defendants pleaded innocent at their arraignment Aug. 5 and will remain in custody pending a preliminary court hearing next week.

Even though Shapiro remains in custody in lieu of $5 million bail, prosecutors are taking what they said was the rare step of asking a Municipal Court judge to immediately hear the testimony of the primary police informant, Jorge Ventura Santamaria. That way, Rosenthal said in an interview, Shapiro has “less of an incentive to have Ventura killed” before the trial, since the testimony would still be entered into the record.

In court documents filed Monday, authorities alleged that a “reliable confidential informant” has sworn that Shapiro “placed a contract on the life” of Ventura after Shapiro’s arrest.

Ventura is prepared to testify that he was trained to stage auto accidents by the office administrator of Shapiro’s law firm, Gaudencio (Goody) Basa, according to an affidavit by Logan Morff, a criminal investigator with the state Department of Insurance. Ventura also met many times with Finn to discuss the status of his cases, Morff said.

“Ventura is an essential witness in this case,” Morff said, “and his death could significantly interfere with the people’s ability to prosecute the case against the defendants.”

Ventura was being held in the protection of state authorities, who would not divulge his whereabouts, according to court documents introduced at a bail hearing Monday for Shapiro and the other three defendants.

Rosenthal asked that Shapiro remain in jail as “a danger to the community.”

Rosenthal also alleged that Basa intended to flee Southern California if released on bail.

Dist. Atty. Ira Reiner and state Insurance Commissioner John Garamendi hailed the Aug. 5 arrest of the four men as a major breakthrough in their efforts to get past the middlemen and low-level operatives who cooperate in such fraud rings.

In the past, authorities have been able to prosecute only those who actually staged accidents, and lawyers involved could claim to know nothing about the fraud, they said. Reiner said Ventura’s testimony would finally allow prosecutors to pin the blame on a lawyer who has gotten rich off insurance fraud rings.

Authorities said Shapiro and Finn masterminded a fraud ring that is suspected of staging car accidents and representing as many as 1,000 clients in fraudulent cases that brought more than $14 million into the law firm’s coffers at the expense of insurance firms.

The case against Shapiro and his three alleged associates rests on the testimony of Ventura, who was convicted of insurance fraud and sentenced to four years in jail for his role in insurance fraud activities, authorities said.

Ventura is a “capper,” or organizer, who recruited people to participate in staged accidents and then signed them up for the Shapiro & Finn law firm at 5455 Wilshire Blvd., authorities allege. Ventura referred $3 million in fraudulent cases to the firm in return for more than $1.5 million in fees, according to court documents.

In June, 1991, Ventura was convicted of staging between 200 and 300 accidents and agreed to cooperate in the ongoing investigation.

Police also took into custody David Shin, 32, of Northridge, alleging that he, too, was a “capper” who referred more than 1,000 clients to Shapiro and Finn over the past two years.

Authorities said most of the accidents involved two carloads of co-conspirators running into each other and then filing claims, but that others involved real victims.

State and local authorities obtained a civil court order that froze all assets of the four men and prevented them from using those assets to post bail unless they can prove in a court hearing that the money was earned legitimately. On Monday, Finn’s bail was reduced to $3 million. Shin remains in custody in lieu of $5 million bail, and Basa is being held in lieu of $1 million bail.

If convicted, Shapiro and Finn face maximum sentences of nine years in state prison and fines of more than $6.6 million apiece.