Taxpayers Paid $475,000 for Defense in Fraud Case : Courts: Cost of the four-month trial of Olen Phillips and Charles Francoeur is among the highest for indigents.

Ventura County taxpayers spent about $475,000 to defend Olen B. Phillips and Charles J. Francoeur in their four-month fraud trial, one of the highest amounts ever paid by the county to represent indigent defendants, a county attorney said Tuesday.

“This is real big,” Assistant County Counsel Lawrence L. Matheney said. “I couldn’t tell you whether it’s the largest ever, but it’s major.”

Phillips and Francoeur were accused in an 81-count indictment of bilking 21 investors out of more than $3 million in complicated land investment deals. After the lengthy trial, however, the jury convicted Phillips of only one theft charge, while Francoeur was found guilty of four theft counts and one conspiracy charge.

Their defense cost $350,000 in accountant fees alone, Matheney said. In addition, he said, Phillips had about $3,000 in investigator expenses and Francoeur spent about $26,800 on investigators. Phillips’ attorney, Steven D. Powell, was paid about $51,400, while Francoeur’s attorney, William Maxwell, received about $43,000.

In an effort to recoup some or all of that money, Matheney and several other county officials spent an hour and 40 minutes Tuesday taking a sworn statement from Phillips aimed at determining his financial status.

According to Phillips, it’s not good.

The 52-year-old jetliner pilot, who presided over a multimillion-dollar financial empire until it collapsed in 1989, said he now lives on about $9,000 a month take-home pay from his job with United Airlines. Since the mortgage holder foreclosed on his five-bedroom home in Westlake Village, he and his wife and two children have rented a two-bedroom house in Oak View, Phillips said.

He said all assets of his defunct company, the Phillips Financial Group, have been taken over by a court-appointed receiver who is trying to recoup some of the money lost by investors. Phillips said he believes he is owed “hundreds of thousands of dollars” from the limited partnerships and other assets controlled by the receiver, “but none of that is collectible.”

He also denied suggestions by some disgruntled investors that he had squirreled away money in South American bank accounts.

“I have never been to South America . . . or Central America,” Phillips said. “I have no accounts to my knowledge anywhere in the world other than those I mentioned.”

Nor has he salted away funds in safe deposit boxes, jewelry, stock, or land, Phillips said. He drives a 1980 Mercedes and owns a motor home worth about $8,000. Liens were placed on both vehicles and on his furniture when he borrowed $150,000 from a friend after his business collapsed, Phillips said.

Nearly half of his take-home pay goes to pay debts, Phillips said, including more than a dozen credit-card accounts that he said were run up after the business failure.

But Phillips’ debt to the county takes precedence over his other obligations, county officials said. Under the law, courts must provide an indigent defendant with an adequate defense, but after the trial a hearing is conducted to determine the defendant’s ability to repay the court.

As the officials questioned Phillips on Tuesday in a small courthouse conference room, they offered several suggestions to help him cut his costs.

Referring to Phillips’ $800-per-month grocery bill, court collections supervisor Linda Weaver said, “You can try using coupons.” And the $450-per-month phone bill? “Maybe we can buy some stamps and paper,” Weaver suggested, after Phillips said he needed to keep in touch with friends and relatives in Oregon and Texas.

Weaver also seemed surprised at Phillips’ contributions to First Baptist Church of Thousand Oaks. “You give $750 per month to your church?” she asked. “Yes,” Phillips replied.

Ray Wolfe, another court collection official, said indigent defendants are permitted to keep enough income to pay for food, shelter, medical bills and expenses involved in maintaining a job. “We allow you the necessities of life,” he said. “The other stuff, we’re not concerned about. . . . You have a commitment here.”

Wolfe invited Phillips to join with court officials to work out a repayment plan that both sides could present on Nov. 30 to Superior Court Judge Frederick A. Jones, who will make the final decision on Phillips’ ability to pay back the county.

“I’m hoping we can reach agreement on how tight the belt should go,” Wolfe told Phillips. He later said he believes Phillips should be able to pay at least $3,000 per month to the county.

Phillips said he feels an obligation to repay his creditors. “I believe you’re saying I should stop repaying them and pay for the defense,” Phillips said. Referring to his conviction on only one of the 81 counts, he added: “I’m surprised it’s not on a pro-rata basis. I should pay one eighty-first of the cost. Then I’d be eager to reach an agreement.”

Wolfe replied that Phillips would be liable for the defense costs even if he had been acquitted on all the charges.

Phillips, who faced a maximum 10-year prison term if he had been convicted on all charges, completed a 60-day jail term last month for his one theft conviction. “I’m certainly thankful for the defense,” he said, as attorney Powell sat behind him.

The questioning uncovered several other aspects of Phillips’ finances:

* The $15,000 in restitution that he paid to the victim in his one conviction, a Colorado investor, was a loan from two relatives and three other associates who chipped in $3,000 apiece, Phillips said.

* He owns a home-built airplane that is currently disassembled and sitting in a storage locker. It cost about $10,000 originally, he said, but probably would not fetch more than $2,000 today because “people don’t like to fly home-built planes unless they built them.”

* The onetime financier does not use a wallet, preferring instead to keep his driver’s license and credit card in a notebook. When Wolfe asked how much cash he had on him, Phillips pulled out $44 in loose bills.

Francoeur, a vice president of Phillips’ company who lives in Agoura, is due in Jones’ courtroom Friday for questioning on his financial status. Francoeur, 35, was sentenced to seven years and eight months in prison but is free on bail while he appeals his convictions.

While the county tries to recoup its expenses for Phillips and Francoeur, the tab may continue to go up as the trial date nears for another official of Phillips’ company. Felix Laumann, 57, of Cambria is scheduled to go on trial Jan. 16 on theft and securities charges.

His attorney, Deputy Public Defender John H. Voigtsberger, said Laumann’s expenses may not be as high because of evidence uncovered in the Phillips-Francoeur trial.

And the trial may be delayed further because Laumann continues to suffer from a serious liver ailment, Voigtsberger said. “Felix is very seriously ill and getting worse,” he said.