Trial to start for man accused of looting S&L

February 07, 1994|By Marcia Myers | Marcia Myers,Sun Staff Writer

This is a day federal prosecutors say Tom J. Billman crossed an ocean to avoid.

The former executive will step into a federal courtroom in Baltimore this morning for the start of his trial on charges of looting his Bethesda savings and loan of $28 million.

For the government, the case has required patience. Mr. Billman disappeared in 1988 as he was being investigated and was still missing a year later when a federal grand jury indicted him on multiple counts of fraud. He pursued an extraordinary life until his arrest in France nearly a year ago.

No longer is he George M. Lady, the worldly businessman investigators say he claimed to be in 1989 while cruising the Mediterranean on his two yachts and throwing lavish parties for newfound friends.

Nor is he John Rink, the modest-living champagne entrepreneur that was his persona when authorities caught up with him outside his one-bedroom apartment in Paris last March.

He can legitimately claim to be one of the most complex, colorful and exasperating defendants ever encountered by Maryland's federal prosecutors.

At his few court appearances since being extradited in December, Mr. Billman, 53, balding and bearded, has strolled confidently into the courtroom without betraying a hint of concern.

Two co-defendants were acquitted in a 1992 trial that prosecutors said was hindered by Mr. Billman's absence.

Mr. Billman has requested that his fate be decided by U.S. District Judge J. Frederick Motz rather than by a jury. If convicted on all 18 counts of mail and wire fraud, he could receive prison terms totaling 90 years.

The trial will be a tedious dissection of dozens of financial transactions that occurred between 1984 and 1986.

For the next two months, the former thrift chairman could hear testimony from more than two dozen prosecution witnesses, including some of his former depositors at Community Savings & Loan.

Prosecutors intend to show that Mr. Billman masterminded a plan that diverted more than $106 million from Community to prop up failing real estate ventures. The government also contends Mr. Billman placed $22 million in two Swiss bank accounts before fleeing the country.

Money still owed to accounts

Community's collapse in 1985 played a major role in Maryland's savings and loan scandal and left the state responsible for catastrophic losses. Even now, nearly 900 of the 27,000 accounts Community held in 1985 are still owed money.

"When we turn the lights out on this, unless there's some more money recovered, it will have cost the state more than $80 million," said Patrick M. McCracken, fund director for the Maryland Deposit Insurance Fund, which insured the accounts.

Mr. McCracken is perhaps better acquainted than anyone with those costs. He has been in his job since a few months before Community failed, a position that has assured him a ringside seat on the Billman case. He intends to be in the courtroom when the trial opens and says he never doubted Mr. Billman would eventually go to trial.

"We expected that some day he would return on his own volition," he said. "We're just hopeful to recover some funds."

For the government, the trial represents a last chance on a high-profile case that has proved more than a little embarrassing. Besides Mr. Billman's abrupt disappearance and success at eluding authorities, there were the acquittals in 1992 of Community's president, Clayton C. McCuistion, and Barbara A. McKinney, a former Community director whom prosecutors have described as Mr. Billman's girlfriend.

Some of the activities on which the government's case turns are now 10 years old.

"It has been a long time, so people's memories have dimmed, but others have testified so many times they have memorialized the details," said Assistant U.S. Attorney Barbara S. Sale, who is handling the case with co-prosecutor Joyce K. McDonald.

Their portrait of Mr. Billman's activities abroad may be little more than a snapshot. Details about his departure from the United States may be revealed, but only as they relate to his intentions -- and only if Judge Motz permits them. He hasn't decided that question.

Mr. Billman's fingerprints and handwriting samples have been ordered in an effort to link him to documents the government believes he originated during the alleged scheme, and to travelers checks used while he was allegedly on the run.

Wiretapped telephone conversations with a girlfriend in the United States in 1989 also might be presented, as could information about $500,000 he allegedly wired her from Europe.

Mr. Billman's lawyers, John R. Fornaciari and Robert M. Disch, wouldn't reveal their plans for his defense last week and declined to return numerous phone calls to their Washington, D.C., office.

If the earlier trial is any indication, their case could hinge on claims that Community was a losing proposition when Mr. Billman bought it in 1982 and that the business decisions made at the time reflected the high-risk financial climate of the mid-1980s.

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