Attorney pleads guilty for role in HOA fraud; details of restaurant scheme surface

Article Courtesy of The Las Vegas Review-Journal

By Jeff German

Published October 26, 2011  

A Las Vegas attorney who once ran a popular courthouse restaurant pleaded guilty Monday in the massive federal investigation into fraud and corruption at homeowners associations.

David Amesbury, 57, whose former partners in the restaurant are central figures in the federal probe, pleaded guilty to one count of conspiracy to commit mail fraud and one count of conspiracy to commit bank fraud.

He is the eighth defendant and the first lawyer to enter a felony plea in the far-reaching investigation, which has targeted lawyers, judges and former police officers.

U.S. District Judge James Mahan set a Jan. 23 sentencing.

In his plea agreement, Amesbury admitted playing a role in the massive scheme to take control of homeowners association boards with members who pushed for construction defect lawsuits against builders. A dozen homeowners associations have been dragged into the investigation.

Amesbury, whose wife is a deputy district attorney, admitted that between March and September 2008, he was paid a $3,000 kickback by his co-conspirators to help rig board elections at Chateau Nouveau and Pebble Creek. Homeowners were misled into thinking Amesbury was hired to oversee the elections on their behalf, the agreement said.

Amesbury also admitted that he participated in a separate scheme to defraud banks while seeking refinancing for what is believed to be the 

Attorney David Amesbury walks from the Lloyd George U.S. Courthouse on Monday after pleading guilty to fraud charges involving homeowners associations in the Las Vegas Valley. He is the eighth defendant and the first lawyer to enter a plea in the far-reaching investigation, which has targeted lawyers, judges and former police officers. 

Courthouse Cafe, which he operated at the Regional Justice Center under a Clark County contract with two partners, former construction company boss Leon Benzer and ex-Las Vegas police Lt. Benjamin Kim.

The scheme, which occurred from October 2008 through July 2009, involved striking a secret deal to let a businessman identified as "S.K." handle the daily operations of the cafe without informing the county or the banks, according to court documents unsealed Monday in Amesbury's case.

The businessman paid Amesbury and his partners $8,000 a month and kept any additional profits from the courthouse operation, the documents said.

The documents do not specifically name the Courthouse Cafe, which is now operating as a Capriotti's Sandwich Shop, a national franchise based in Las Vegas. But the Las Vegas Review-Journal earlier this year detailed some of the dealings over the cafe between Amesbury and his former partners and the county.

Benzer is the former owner of Silver Lining Construction, a company that did construction defect work for homeowners associations. Silver Lining's offices were among those searched in an FBI-Las Vegas police raid in September 2008. Kim's wife, Lisa Nicklin, ran Platinum Community Services, a homeowners association management company that also was searched in the raid. She is said to be cooperating in the investigation.

All three partners ran the Courthouse Cafe until January when they had a falling out under the weight of the federal investigation and turned over their restaurant rights to Capriotti's with the county's approval

Benzer and Kim have not been charged in the federal investigation.

But on Friday, Mary Ann Watts, a former property manager at Vistana, identified Benzer in federal court as one of the key players in the alleged conspiracy to take over the homeowners associations.

Watts told Mahan that Benzer and one of her fellow defendants, former Vistana board member Edward Lugo, gave her "seed money" to start her own property management company in furtherance of the alleged takeover scheme.

Watts and Lugo pleaded guilty last week.

In court Monday, when Mahan asked Amesbury how he pleaded to the charges, he responded, "Guilty sir."

Amesbury said he understood he would have to pay $3,000 in restitution, the cost of the election rigging kickback.

Mahan allowed Amesbury to remain free on his own recognizance, and afterward both Amesbury and his defense attorney, Frank Cremen, declined comment.

Amesbury's plea is the latest in a long line of deals expected in the high-profile federal case.

Lawyers from the Justice Department's fraud section in Washington, D.C., plan to file as many as two dozen plea deals.

Amesbury and the other defendants who have pleaded guilty all have agreed to testify for prosecutors in their push to indict the higher-level players.

With the help of friendly homeowners association board members, lucrative legal work and repair contracts were funneled to lawyers and companies associated with the scheme at the expense of the homeowners, who were deprived of honest voting on their boards, court documents have alleged.

The board members were straw purchasers elected by the co-conspirators through classic dirty campaigning that included conducting phony polling, hiring private investigators to dig up dirt on candidates and rigging the balloting, the documents alleged.

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