LABORERS (LIUNA)
Oregon Fund Manger in Plea Talks
Ex-union fund manager Barclay Grayson is negotiating a deal with federal
prosecutors investigating his firm's loss of more than $200 million, said
U.S. Bankruptcy Judge Randall Dunn Mar. 7. Dunn revealed the plea
bargaining at a hearing on a personal bankruptcy petition that Grayson
filed in Feb. He and his father, Jeffrey L. Grayson, the founder and chairman
of Capital Consultants, surrendered the firm to a federal receiver in Sept.
2000 after the Sec. & Exch. Comm'n and the Dep't of Labor filed suits
accusing them of defrauding clients. The hardest-hit clients were union
pension funds, including the Laborer's Int'l Union of N. Am. SEC called
the scam the biggest fraud involving a money manager in U.S. history.
The Graysons and others are targets of a federal criminal investigation. Lance Caldwell, Asst. U.S. Atty. in charge of the probe, declined to comment on Barclay Grayson's dealings with his office. But, Steven Ungar, Barclay Grayson's criminal defense attorney confirmed the bargaining.
In Feb., John D. Abbott, ex-LIUNA boss in Oregon pled guilty to taking $195,000 in payoffs from Jeffrey Grayson. Abbott's deal may allow him to serve only 15 months in prison in return for testifying against other union bosses and Jeffrey Grayson.
Because of the bargaining, Dunn noted, Barclay Grayson could assert Fifth Amendment rights in his bankruptcy proceedings, and the lack of his testimony would hamstring the process. Dunn postponed the bankruptcy process for 90 days in hopes the negotiations would be completed. [Oregonian 3/8/01]
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