Article Courtesy of The Las Vegas
By Jeff German
March 8, 2015
More allegations surfaced Thursday about heavy-handed tactics used by former construction company boss Leon Benzer in the scheme to take over homeowners associations.
Longtime Republican consultant Steve Wark, the first of 37 people to plead guilty in the massive scheme, testified that Benzer sent employees to HOA board meetings to “intimidate” and “growl” at homeowners and board members.
Wark, who admitted Benzer owned his vote as a member of the Vistana board, said he also learned that Benzer’s security officers were seen carrying “sidearms” at an HOA election.
“It was this strong-arm stuff that I didn’t believe was proper and necessary,” Wark told a jury hearing evidence against four remaining defendants charged in the scheme. Federal prosecutors have alleged the conspiracy defrauded HOAs of millions of dollars between 2003 and 2009.
Veteran HOA Attorney John Leach, who said he was not on friendly terms with Benzer, testified that he once had an encounter with Benzer. With huge bodyguards nearby, Benzer went nose-to-nose with him and started talking tough, he said.
Leach said Vistana’s general counsel, Keith Gregory, eventually asked him to discuss with board members the validity of a $7.2 million construction defect contract the board was considering for Benzer’s Silver Lining Construction Company.
Under questioning from lead Justice Department prosecutor Charles La Bella, Leach testified that Gregory never told him he was secretly being paid by Benzer, who also had a majority of the five-member board on his payroll.
Leach said he didn’t make a recommendation but simply explained options available to the board members — either award the contract to Benzer, or not.
The Vistana board voted 3-2 to give Benzer the contract on Sept. 19, 2007, along with $1.3 million up-front to prepare for the repair work prosecutors allege was never really done. Benzer used some of the money to repay loans he took out to keep the scheme alive, according to prosecutors.
Wark, who chaired what he described as a “choreographed” board meeting, testified that he and the other members paid by Benzer sided with the desperate construction company boss.
Wark admitted on the witness stand that he hid his connections to Benzer from the Vistana homeowners.
The former Nevada Republican Party chairman said his main goal on the board was to get Benzer, his onetime business partner, the contract so that Benzer could “make lots of money.”
Gregory is one of the four defendants standing trial on conspiracy and fraud charges.
The other defendants are Benzer’s half-sister Edith Gillespie, a ballet teacher who prosecutors say recruited straw buyers; Salvatore Ruvolo, who prosecutors say was a straw buyer and a HOA board member at Park Avenue and Chateau Nouveau; and David Ball, a real estate agent prosecutors say Benzer placed on the Chateau Nouveau board.
Defense lawyers contend the four defendants were not part of the multi-million-dollar scheme and consider themselves victims of Benzer, who is among those who pleaded guilty.