April 20, 2014

DBSI in Dollars

Filed under: Probable Cause — Bill @ 3:42 pm

DBSI$ copyOpenCdA’s previous posts about the DBSI securities fraud trial in Idaho’s Federal District Court have focused on the criminal trial.

Of course, a portion of that trial revealed the dollar losses suffered by those caught up in the scheme.  It  is difficult for most of us to grasp the magnitude of those dollar losses.  The aggregate approximations sometimes used, “millions if not billions of dollars,” doesn’t begin to help us appreciate the pain and suffering incurred by DBSI’s creditors.  For a small creditor, the loss of just a few thousand dollars may mean the loss of a business or the ability to retire.

Thanks to OpenCdA reader “Stebbijo” we can begin to personalize the losses and maybe to better appreciate not just their dollar value but their emotional impact as well.  “Stebbijo” provided us with this List of Creditors filed in the Federal Bankruptcy Court in Delaware.  You will note that there are 1,791 pages, and there are 20 or more creditors listed on each page.  The actual list of creditors is only 895 pages, but there are two lists:  one is sorted in ascending alpha on the creditor’s name, and the other is sorted in ascending numeric by claim number.  In addition to identifying the creditors, the column headed “Claim Amount” often but not always lists the dollar amount of each claim.  For those interested in looking at the various bankruptcy filings in re DBSI Inc., et al, The case number is 1:08-BK-12687.

OpenCda has quickly scanned about 500 pages looking for creditors who listed their address in northern Idaho.  We have found at least 10 in northern Idaho.   We do not believe that is the entire number, however, since some of the claims were likely filed through attorneys with addresses not in northern Idaho.  For example, a creditor identified as “Call Ctr Coeur DAlene Ironwood Tenants in Common” used a law firm in Eagle, Idaho, and filed claims in excess of $1,066,400.91.

Careful readers will note we have avoided referring to the creditors as “victims,” because some of the creditors listed in the List of Creditors include criminal defendants Swenson and Ellsion.  The creditors may be investors, but they may also be businesses who provided goods and services to acquire, build, or operate the various DBSI enterprises.


April 18, 2014

Federal Lawsuit Challenges Idaho’s “Interference With Agricultural Production” Law

Filed under: Probable Cause — Bill @ 4:24 pm


[A lawsuit filed March 16, 2014, in Idaho Federal District Court challenges the constitutionality of Idaho’s newly-passed Interference with Agricultural Production law.  The law is better known in Idaho by its informal nickname, the “ag gag law”.

A news summary of the lawsuit appeared in an online article by Austin Hill dated April 18, 2014, entitled Idaho farm protection bill faces legal scrutiny.

The formal complaint, filed in the federal district court under case number 1:14-cv-00104- BLW, is titled “Animal Legal Defense Fund et al v. Otter et al“.  Here is a link to the 52-page complaint(more…)

April 16, 2014

An Opportunity for OpenCdA Readers to Ask Questions

Filed under: Probable Cause — Bill @ 2:23 pm

DBSIEarlier today OpenCdA had a new registrant with the username “mkjcrich”.  Shortly thereafter, “mkjcrich” attached this comment to our post titled DBSI Update (Subtitle:  Manipulating Audits):

I was foreperson on this jury and after being discharged found this website. The webhost has done an amazing job offering information and insight into the case. It was a very complex case and the jury took its time dealing with each defendant on each issue. Judge Winmill informed us about Agent Morse’s suicide/death yesterday after we were released. Some of the jurors knew but most did not and a few took the information very hard. If there are any questions that I have the answers to….feel free to ask.

Comment by mkjcrich — April 16, 2014 @ 12:51 pm”

First to “mkjcrich”:  Thank you for your jury service. I hope that it was a satisfying and rewarding experience for you and your fellow jurors.  Thank you also for your nice compliment.

I think as a starter, it would be informative to OpenCdA readers to hear your overall comments and impressions about your jury service in a very serious and complex federal criminal trial.   How would you characterize your overall experience with the federal criminal justice system?  What expectations did you have going into the trial as far as your service was concerned?  How would you characterize the overall performance of your fellow jurors?  If since your release from jury duty you have read or heard news reports of the trial, how would you compare the accuracy and completeness of the news reporting with what you observed as a sitting juror?  Given that this appeared to us to be a complex financial crimes case, how would you characterize the ability of the government to present the admitted evidence in a logical, understandable fashion?  Overall, what most surprised you, what most pleased you, and what most disappointed you about your service as foreperson in a federal criminal jury trial?

Additionally, if as it appeared to us DBSI’s principals started up intending to operate lawfully as a legitimate business but devolved into criminal conduct, what lessons can communities and individuals learn from the admitted evidence to help us identify and avoid becoming victims of companies like DBSI?

Boss Hog to the Pen …

Filed under: Probable Cause — Tags: — Bill @ 10:59 am

rizzoAccording to Angela Spaccia, Robert Rizzo’s cohort in the Bell corruption scandal, Rizzo had a saying:

“Pigs get Fat … Hogs get slaughtered!!! So long as we’re not Hogs … all is well!!”

Today, California Superior Court Judge Kathleen Kennedy told Hog Rizzo that all was not well.  She sentenced him to serve 12 years in state prison for his part in the Bell corruption scandal.  He will be allowed to serve the state’s sentence concurrently with his 33-month federal sentence on tax-related charges.

The details of today’s sentencing are in LA Times reporter Jeff Gottlieb’s online story headlined Rizzo gets 12 years in prison, marking end to scandal that rocked Bell.

While Rizzo’s sentencing on federal and state charges and Angela Spaccia’s sentencing on state charges do appear to end the state action, there remains the possibility of federal charges against Angela Spaccia.  As OpenCdA has noted in several earlier posts, Angela (Sheffield) Spaccia served as Kootenai County, Idaho’s Finance Director prior to going to Bell.

April 15, 2014

Just Down the Street…

Filed under: Probable Cause — Tags: , — Bill @ 12:19 pm

CudahyJust down the street (that would be Atlantic Avenue) from scandal-ridden Bell, California, is the city of Cudahy (pronounced “cudda’-hee” or “cudda’-hay”).  In fact Bell is Cudahy’s next-door neighbor to the north.  It appears that Cudahy and Bell share more than just a border.

In an online story dated April 15, 2014, and headlined State accuses small city Cudahy of large spending irregularities,  Los Angeles Times reporters Jeff Gottlieb and Stevel Marble reveal that California State Controller John Chiang today released the state’s City of Cudahy – Review Report – Administrative and Internal Accounting Controls for the period July 1, 2010, through June 30, 2012.  (Note:  Times reporter Gottlieb updated this story and added details in a later one headlined Audit faults Cudahy as government in chaos.)

The essence of the state’s Review Report can be summed up in the first sentence of the Conclusions section:  “We found the City of Cudahy’s administrative and internal accounting control deficiencies to be serious and pervasive.  As a result, the potential for fraud, waste, and abuse is very high.” (more…)

DBSI Update: Guilty!

Filed under: Probable Cause — Bill @ 6:41 am


In its story headlined Jury:  DBSI officials guilty, but not of all charges, the Idaho Statesman is reporting that DBSI President Douglas Swenson was convicted by a federal district court jury of 78 counts of various frauds.

DBSI attorney Mark Ellison and two corporate officers were convicted on 44 counts of securities frauds.

This is a preliminary story; the Idaho Statesman will have more complete coverage in its Tuesday newspaper and online.

OpenCdA has several earlier posts derived from the Idaho Statesman’s reporting and other sources.

And still nothing timely from The Spokesman-Review or the Coeur d’Alene Press.

ADDENDUM on 04-15-2014 at 6:41 AM:  The hyperlink in the first sentence of this post was carried forward to the Idaho Statesman’s article on April 15, 2014.  Today’s Statesman story, headlined UPDATE:  DBSI official convicted of fraud,  provides additional details.  Of particular interest was this from today’s story:

Before its 2008 bankruptcy, DBSI managed 280 shopping centers, office buildings and other commercial buildings in Idaho and 33 other states. The holdings were worth $2.7 billion; many of them were owned by groups of investors to whom DBSI sold fractional shares.

With DBSI’s extensive involvement in 34 states including Idaho and with holdings worth about $2.7 billion, OpenCdA still wonders why this story received pathetically little coverage from Idaho’s other newspapers including the Hagadone News Network and The Spokesman-Review.

Read more here:

April 14, 2014

Kevin Siers, Charlotte Observer, Awarded Pulitzer Prize

Filed under: Probable Cause — Bill @ 3:44 pm

Kevin copy[

The 2014 Pulitzer Prize winners were announced today, and Kevin Siers of the Charlotte Observer won for his editorial cartooning.

Here is a link to Siers’ winning portfolio submitted for consideration.

April 11, 2014

Memorable Comments From the Judge and the Con Artist

Filed under: Probable Cause — Tags: — Bill @ 8:12 am


Yesterday’s OpenCdA post titled Prison for Former Kootenai County Finance Director linked to the preliminary story from the LA Times reporting that former Kootenai County finance director Angela (Sheffield) Spaccia had been sentenced to 11 years, 8 months in California state prison for her role in the Bell, California, corruption scandal.

Today’s Los Angeles Times story headlined Former Bell second-in-command gets 11 years in prison for corruption elaborates on yesterday’s story.  In today’s story there are some telling comments from both Spaccia (Sheffield) and Los Angeles County Superior Court Judge Kathleen Kennedy.  Some of Spaccia (Sheffield)’s comments have been reported before by the Times, but of course Judge Kennedy could not comment until after the trial was over and the sentence had been imposed.

OpenCdA hopes readers will read today’s LA Times article and pay close attention to the comments from both Judge Kathleen Kennedy and the convicted con artist, Angela (Sheffield) Spaccia.  They reveal the mindset of not only the con artist Spaccia and her fellow con artist City Administrator Robert Rizzo, but also the Judge’s now much clearer understanding of the complicity of Bell’s then-mayor and all but one member of Bell’s city council.

Midway through today’s article, Times reporters

We can’t help but wonder if Spaccia (Sheffield)  at that moment might have  been wishing  she had stayed in Coeur d’Alene and Kootenai County, Idaho. (more…)

April 10, 2014

Prison for Former Kootenai County Finance Director

Filed under: Probable Cause — Tags: — Bill @ 12:07 pm

SpacciaBookingPhotoFormer Kootenai County, Idaho, Finance Director Angela (Sheffield) Spaccia was sentenced today to 11 years, 8 months in prison according to the Los Angeles Times.

Spaccia, known as Angela Sheffield when she was Kootenai County’s Finance Director, was convicted on a variety of charges relating to public corruption in the Bell, California, corruption scandal.

Spaccia’s conviction was on state charges in Los Angeles County Superior Court.  Her conviction and sentencing does not preclude additional federal charges being brought against her.

Spaccia’s boss, former Bell administrator Robert Rizzo, is scheduled to be sentenced later this month.

Bell’s former mayor and five city council members have agreed to plead guilty to various charges involving misappropriation of public funds.   Each of them could receive up to four years in prison.

Coeur d’Alene Inches Closer to Selecting New Police Chief

Filed under: Probable Cause — Bill @ 8:22 am

CDAPDLOGO-2Have you seen the five-page vacancy announcement and solicitation inviting applications for Coeur d’Alene’s Chief of Police position?  If not, here’s a link to it.

Job vacancy announcements describe position information including the title, salary, duties, qualification requirements, closing date, and application procedures.  With that in mind, examine closely the City’s police chief vacancy announcement, and pay particular attention to the sections that describe the qualification requirements.  “Requirements” are just that — requirements.  In some cases, the requirements are imposed by state law.

Failing to include all qualification requirements in the vacancy announcement is unacceptable.  That amounts to withholding essential information from prospective applicants, and that reflects badly on the City administration. (more…)

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