Billman wants legal fees paid

June 10, 1994|By Marcia Myers | Marcia Myers,Sun Staff Writer

Tom J. Billman, the convicted financier whose attempts to hide millions in Europe were exposed two weeks ago by federal prosecutors, is asking the U.S. government to help pay his legal fees.

In court filings, the former chairman of Bethesda-based Community Savings and Loan says he has more than $6.5 million in cash, gems and other assets, much of it frozen by the Austrian government.

But Billman, who is awaiting sentencing on a fraud conviction, claims that he is impoverished and asks for a court-appointed, government-paid lawyer.

Meanwhile, his current attorneys, who Billman says are owed $120,000, have asked to withdraw as counsel, according to filings in U.S. District Court in Baltimore. And they say they prefer not to be appointed as his lawyers unless they can be paid from assets frozen in the United States and Europe.

Billman, a one-time fugitive, was convicted in April of defrauding Community's depositors of millions. Prosecutors contend that he wired at least $22 million to Swiss bank accounts before he fled the United States in 1988 while under federal investigation.

Billman eluded authorities for four years before being captured in Paris in 1993. He used a variety of aliases to acquire bogus passports, and lived lavishly on Spain's Costa del Sol, where he bought two yachts and cruised the Mediterranean.

Two weeks ago, Billman claimed that his only asset was an $80,000 wine collection.

But in an application to the court this week, Billman claimed to have earned $8.9 million in capital gains in the past year. Although some of that has been frozen by the Austrian government, part of it was used to pay attorney fees and "investment expenses," he said.

An unspecified amount also went to the Maryland Deposit Insurance Fund, which has spent millions bailing out Community's depositors. According to Billman's papers, he has

paid MDIF $16.3 million, a figure the agency disputes. MDIF is seeking millions more from Billman.

Among the assets Billman claimed: $5.5 million in cash, $400,000 in gems and $90,000 in traveler's checks, all frozen by the Austrian government; $500,000 in cash the U.S. government froze after Billman tried to secretly transfer it to a girlfriend here; and $170,000 in "uncollectible receivables."

The wine collection he claimed two weeks ago as his only asset may be in France, but its status is unknown, he said.

"Because his assets have been frozen or seized, the defendant has no funds or assets to pay the $120,000 owed to his counsel or to continue to defend this action or to appeal the Court's judgment," his attorneys wrote.

Billman wants to retain his lawyers and pay them from the frozen assets in Austria, court documents say. If that is allowed, he would assign to MDIF his remaining assets in Austria and his wife, Clare, would turn over to MDIF about $800,000 in assets in Great Britain.

His application listed nearly $150 million in debts, including $39 million in back taxes and a $109 million civil judgment in Montgomery County against Billman and other Community officials. He said he owes his wife $1.5 million in loans, attorney fees and other obligations.

Assistant U.S. Attorney Barbara S. Sale said yesterday that she did not know whether the government would file a written response to Billman's request.

MDIF attorney Neil Dilloff, who was involved in secret negotiations with Billman's Swiss lawyers to obtain about $13 million from Billman's accounts in Europe in the days before he was convicted, said: "We believe Mr. Billman has a lot more money than he says he has, and we're going to try to get it." Billman's offer to turn over his remaining assets in Austria is not adequate, Mr. Dilloff said.

Billman's attorney, John R. Fornaciari, of the Ross and Hardies law firm in Washington, D.C., could not be reached for comment.

If Mr. Fornaciari and Billman's other lawyers were to continue representing him under court-appointed status, their pay for the work would drop significantly.

Court-appointed lawyers in a felony case can earn a maximum of $3,500. According to records obtained by MDIF, Mr. Fornaciari has earned millions in legal fees since Billman's troubles began in 1985, Mr. Dilloff said.

Besides the $13.5 million that the Swiss lawyers transferred to MDIF in late March -- of which $2 million was deducted for costs -- the agency also acquired more than $2 million from the auction of Billman's Eastern Shore estate.

Billman was to have been sentenced May 25, a day after his lawyers filed papers describing him as "hopelessly insolvent."

But the hearing was abruptly postponed when a 200-page document filed by prosecutors on sentencing day revealed that even after his conviction, Billman had worked to conceal millions of dollars stashed in Europe.

Billman's sentencing was rescheduled for June 21.

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