With Postmus’ Credibility Shot, DA Banks On Brown As Lead Witness

(January 8)  Matt Brown, San Bernardino County’s current assistant auditor-controller-treasurer and the one-time chief-of-staff to former county supervisor Paul Biane, is about to emerge front and center  as the lead prosecution witness in the Colonies Lawsuit Settlement Public Corruption Prosecution, the Sentinel has learned.
Prosecutors are hopeful Brown can serve to propound information they believe is damaging to the defendants, lay out a context of events crucial to the understanding of what occurred and that he can offset the setback they have been dealt by the dissipation and seeming self-destruction of Bill Postmus, who was the star witness before the grand jury that indicted the accused. But Brown presents some major credibility challenges of his own that will need to be overcome if the case is to go the way prosecutors want.
That ongoing criminal case alleges Rancho Cucamonga-based developer Jeff Burum extorted and bribed former county supervisors Bill Postmus and Paul Biane in a scheme to get them to vote to approve the settlement of litigation brought by the Colonies Partners against the county over flood control issues at the Colonies at San Antonio residential and Colonies Crossroads commercial projects in northeast Upland. Burum was, with Dan Richards, one of the two managing principals of the Colonies Partners. The county conferred upon the Colonies Partners a $102 million payment in November 2006 to end that lawsuit. A February 2010 indictment charged Postmus with receiving a $100,000 bribe, paid in two $50,000 installments in the form of checks to political action committees he controlled. The 2010 indictment also charged former San Bernardino County sheriff’s deputies union president Jim Erwin, who worked as a consultant to the Colonies Partners during their efforts to have the lawsuit settled and was later hired by Postmus to serve as assistant assessor, with having participated with Burum in an extortion scheme targeting Postmus and Biane that preceded the November 2006 vote. Identified in that indictment as unnamed and unindicted coconspirators were Burum, Richards, Biane, public relations professional Patrick O’Reilly and Mark Kirk, the chief-of-staff to supervisor Gary Ovitt. Ovitt had joined with Postmus and Biane in voting to approve the $102 million settlement, which was opposed by supervisor Josie Gonzales and then-supervisor Dennis Hansberger.
Both Postmus and Erwin, who were charged  variously with a host of crimes including conspiracy, extortion, soliciting bribes, accepting bribes, perjury, filing falsified documents and other violations of the public trust, pleaded not guilty to those charges. But in March 2011, Postmus pleaded guilty to all fourteen counts contained in the indictment against him along with one other unrelated drug possession count and agreed to turn state’s evidence. He was the star witness before a newly-impaneled grand jury that heard evidence and testimony from a total of 45 witnesses in April 2011. In May 2011, that grand jury handed down a superseding 29-count indictment that collectively charged Erwin, Burum, Biane and Kirk with conspiracy relating to the alleged bribery scheme. Erwin was hammered with multiple counts, including receiving a bribe, acting as Burum’s agent, perjury, filing falsified documents and tax evasion. Biane was charged with soliciting and receiving a bribe in exchange for his vote. Kirk was charged with receiving a bribe in exchange for influencing his boss, Ovitt, to vote to approve the settlement. Burum was not charged with bribery. Rather, prosecutors fashioned charges against him that alleged aiding and abetting Postmus, Biane and Kirk in receiving bribes. The defendants were also charged with conflict-of-interest and misappropriating public funds. No substantive counts of extortion were charged in the superseding indictment and the extortion counts against Erwin in the February 2010 indictment were dispensed with, although extortion implications were wrapped into the broad conspiracy count contained in the May 2011 indictment.
Defense attorneys filed demurrers on behalf of their clients, motions which called into question the legal sufficiency of the charges against the defendants. A central theme in those demurrers was the inability of prosecutors to charge a defendant with conspiracy or aiding and abetting a crime when that individual stands accused of a crime that necessarily involves the involvement of another individual. San Bernardino County Superior Court Judge Brian McCarville granted many of those demurrers, severely weakening the case, which involved a rare cooperative prosecution by the San Bernardino County District Attorney’s Office and the California Attorney General’s Office. When prosecutors  appealed McCarville’s ruling to the Fourth District Court of Appeal in Riverside, that panel upheld McCarville on most issues of substance. The prosecution then appealed to the California Supreme Court, which essentially overruled the lower courts and reinstated the gist of the case.
The case has been handed back to the Fourth District Court of Appeals, with instructions for any outstanding issues remaining from the demurrer stage to be resolved so the matter can move to trial.
Thus, it now appears likely Burum will be headed to trial on charges of conspiracy, the aiding and abetting of bribery, and misappropriation of funds, Erwin will face charges of conspiracy, aiding and abetting Biane in his reception of a bribe, accepting a bribe, income reporting violations, tax violations and perjury, Biane will need to contest conspiracy and acceptance of a bribe charges and Kirk will be obliged to fend off charges that he received a bribe in the form of a $100,000 donation from Burum to his political action committee in exchange for influencing his boss, Ovitt, to vote to approve the settlement and that he misappropriated $20,000 from that political action committee for his own use.
The prosecution is yet faced with the burden of proving its case to a jury. In that way, relying upon Postmus to reprise his role before the 2011 Grand Jury as the central witness promises to be a risky proposition. In November 2006, just three weeks prior to the Colonies lawsuit settlement vote, Postmus beat incumbent county assessor Don Williamson after utilizing more than $3 million to conduct his countywide campaign for that office.  He resigned as First District supervisor in January 2007 to move into the assessor’s post. Over the next two years, Postmus personally and politically self-destructed as he sank further and ever deeper into the grip of substance abuse, specifically the use of methamphetamine, ecstasy and inhalants. As early as 2006 – in the midst of his campaign for assessor and while he was yet chairman of the board of supervisors –  Postmus had made an unexplained disappearance. That absence was taken  so he could undergo drug rehabilitation treatment, a secret kept under wraps not only by those in his own circle but by then-county administrative officer Mark Uffer and other high ranking county officials. After he became assessor, Postmus, who had no prior real estate appraising experience, was notoriously absent from the assessor’s office. Freed of the discipline of having to make appearances at board of supervisors meetings two or three times a month, Postmus’ drug addiction intensified, despite at least two interventions efforts. In 2008, while Postmus was undergoing treatment, his absence from the assessor’s office became a public issue. A cover story was concocted in which it was acknowledged he was seeking assistance with a substance addiction, but it was falsely claimed he was suffering from a reliance on painkillers brought about by a back injury. In January 2009, after the district attorney’s office began focusing on the potential criminal implication in the partisan application of the authority of the assessor’s office, search warrants were obtained for Postmus’ office and home. When those search warrants were served in January 2009, drugs and drug paraphernalia were discovered at Postmus’ Rancho Cucamonga townhome.  A firestorm of controversy ensued and the following month, Postmus resigned as assessor.
Postmus’ indictment on the bribery charges came a year his resignation from office. Throughout that time, he struggled with his addiction. After his indictment, whatever money he had accumulated during his public career was devoured by living expenses and lawyers fees. At some point in late 2010, even as his attorney, Stephen Levine, maintained the outward fiction of putting on a legal defense in the face of the indictment, Postmus began cooperating with prosecutors.  With the world already closed in upon him and after seeming to have hit rock bottom, a series of events plummeted the man who had once stood at the highest pinnacle of San Bernardino County politics even further downward. During one of Postmus’ appearances in court, officials who suspected he was under the influence of methamphetamine confronted him, subjected him to a drug test and then seized and searched his vehicle, turning up drug residue and paraphernalia, confirming their suspicions. In March 2011, Postmus threw in the towel, pleading to the entirety of the charges pending against him. He then went before the newly impaneled grand jury and provided testimony that was used to support the reindictment of Erwin and the indictments of Biane, Kirk and Burum.
Postmus’ credibility and anticipated role as the lead witness in the prosecution of the four defendants came under question when in October 2011  Postmus voluntarily and with his lawyer’s consent submitted to questioning by FBI Agent Jonathan Zeitlin and Assistant U.S. Attorneys Jerry Behnke and Joseph Widman. The exchange with the former supervisor was part of an exploratory move by the U.S. Attorney’s Office to determine if there might be grounds for the filing of federal charges against the defendants in the state Colonies Settlement Public Corruption Prosecution. Postmus made statements that in some measure contradicted earlier statements he had made, including ones before the grand jury. He also acknowledged that he continued to use methamphetamine, including having ingested the drug  a “couple dozen times” in 2011, during the same time he had been before the grand jury.
The attorneys representing Burum, Biane, Erwin and Kirk made clear that Postmus’ drug use would become a major point of contention with regard to the credibility of his testimony. That point has been rammed home by a consistent stream of internet postings on various media blogs wherein supporters of the defendants and critics of the district attorney’s office and state attorney general’s office have criticized the prosecution for its reliance on Postmus – now a convicted felon and confirmed drug addict – in making its case.
Thus, the prosecution is now in the process of reassessing how it will proceed. Prosecutors believe they can minimize the role Postmus will play in offering prosecution testimony and instead rely on public campaign disclosure documents which reveal Burum’s provision of money to the three others indicted with him, as well as the testimony of two other figures involved in the matter – public relations consultant Patrick O’Reilly and Brown.
Prosecutors intend to call O’Reilly as a witness and elicit from him testimony that in 2006, three months before the election and the settlement which followed 21 days later, he had prepared mailers based upon information that had been provided to him by Burum or  Burum’s hired private investigators. Those mailers revealed that Biane was personally insolvent and teetering at the brink of bankruptcy and that Postmust was a homosexual who was hopelessly in the grip of drug addiction even as he was perched at the pinnacle of county government as the chairman of the board of supervisors and heading the county GOP as the chairman of the San Bernardino County Republican Central Committee.
While that electioneering material was prepared and ready for dissemination, none of it was actually mailed to voters. In this way, prosecutors believe, they can establish for a jury that Burum, with the assistance of Erwin, who they allege acted as a go-between in his role as a consultant to the Colonies Partners, had blackmailed, i.e., extorted, both Postmus and Biane by threatening to publicly reveal information that would have been damaging to them politically.
Key to the bribery element of the case is $400,000 in donations Burum and/or his company, the Colonies Partners, made to political action committees controlled by the other three defendants and Postmus over the seven month period following the settlement.
On March 20, 2007, Burum made out a check for $100,000 to what prosecutors say was the then-nonexistent Committee for Effective Government PAC. Prosecutors say Erwin then created the Committee for Effective Government PAC on March 23, 2007, establishing himself as chairman, Clyde Boyd-vice-chairman, Elizabeth Sanchez-secretary, Betty Presley-treasurer, Gloria Affatati-Boyd-director, and Steven Hauer-director. On March 28, 2007, Erwin deposited the $100,000 check into the Committee for Effective Government PAC’s bank account.
On May 16, 2007, Burum wrote a check for $100,000 from the Colonies Partners to the then-nonexistent Alliance for Ethical Government PAC. On May 25, 2007, Kirk, according to prosecutors, directed his campaign accountant to complete the establishment of the Alliance for Ethical Government PAC. On May 29, 2007, Kirk deposited the $100,000 check into the Alliance for Ethical Government’s bank account.
On June 15, 2007, Burum and the co-managing principal with the Colonies Partners, Dan Richards, signed a check for $100,000 from Colonies Partners to the San Bernardino County Young Republicans PAC, which prosecutors maintain was secretly controlled by Biane. .
On June 29, 2007, Burum signed a check for $50,000 from the Colonies Partners to the Inland Empire PAC, which publicly listed Dino DeFazio as chairman, Mike Gallagher as vice-chair, Jeff Bentow as community outreach director, and Mike Richman as executive director, but which prosecutors say was secretly controlled by Postmus. On June 29, 2007, Burum signed a check for $50,000 from the Colonies Partners to the Republicans for a Conservative Majority PAC, which listed Mike Richman as the sole member of the board of directors and executive director but which was, prosecutors maintain, secretly controlled by Postmus.
Prosecutors allege the provision of these political donations to the various PACs was an elaborate ruse to launder bribes.
The model upon which the other involved PACs  were designed, prosecutors allege, was the San Bernardino County Young Republicans PAC, which prosecutors allege was controlled by Biane, but which was actually set up by Brown, his chief-of-staff. Brown founded at least four political action committees used to vector money to various political candidates and campaigns.
The Sentinel has learned that after district attorney’s office had begun looking into the Colonies lawsuit settlement in earnest, in the spring of 2009 district attorney’s investigators Hollis Randles, Schyler Beaty and Robert Schreiber confronted both Kirk and Brown, aggressively questioning them with regard to action they had taken on behalf of Ovitt and Biane, suggesting the PACS they had set up had been used to launder kickbacks.
Kirk initially responded to some of the questions but became increasingly reluctant to continue, and resisted efforts to wring from him statements implicating Ovitt. He insisted that the interrogation be brought to a close and refused to make any further statements outside the presence of an attorney.
When the investigators isolated Brown, they subjected him to accusations that he had acted illegally on Biane’s behalf  as well as in tandem with him in a criminal conspiracy. Panicked, Brown acceded to cooperating with the district attorney’s office.
Of immediate interest to Schreiber, Beatty and Hollis was the San Bernardino County Young Republicans PAC, which Brown founded in 2006 with Biane’s blessing to assist Biane and other members of Biane’s political circle in distributing money to politicians they supported. Campaign finance records show that the San Bernardino County Young Republicans PAC became a political force to be reckoned with after the $100,000 check from Colonies Partners was deposited into its account in June 2007. The indictments allege that the series of $100,000 donations to the political action committees founded and controlled by Postmus, Brown, Kirk and Erwin were in fact quid pro quos — bribes — paid in exchange for the approval of the settlement. Prosecutors allege that Biane, through Brown, secretly controlled the San Bernardino County Young Republicans PAC.
Indeed, political action committees Brown and Biane were involved with raised numerous questions, and not just with district attorney’s office investigators. The Sentinel is informed that a complaint was filed more than two years ago with the state Fair Political Practices Commission (FPPC) citing a PAC founded by Brown in 2008, the San Bernardino County Taxpayers Association, which is separate from the San Bernardino County Young Republicans PAC alluded to in the indictments. According to well placed sources, both the San Bernardino County Taxpayers Association and the San Bernardino County Young Republicans PAC were under scrutiny in that investigation.
On March 17, 2008, Brown formed the San Bernardino County Taxpayers Association PAC and named J.M. Olchawa as the PAC’s treasurer. Both Brown and Olchawa are residents of Grand Terrace. Olchawa endowed the PAC with its first operating capital in the form of a $100 contribution.  Less than a month later, on April 9, 2008, the San Bernardino County Young Republicans PAC contributed $40,000, which had apparently originated with the $100,000 contribution from the Colonies Partners the previous year, to the San Bernardino County Taxpayers Association PAC. The following month, on May 29, 2008, one of the political action committees controlled by Postmus, the Inland Empire PAC, infused the San Bernardino County Taxpayers PAC with $3,000 and the month after that, on June 2, 2008, with another $2,000. That $5,000, too, had apparently been originally provided by the Colonies Partners.
Based upon investigators’ exchanges with Brown, prosecutors with both the  California Attorney General’s Office and the San Bernardino County District Attorney’s office had grounds to allege the PAC had been used as a vehicle to launder bribes and kickbacks to Biane.
In the less than two month period between the $40,000 contribution from Brown’s own Young Republicans PAC on April 9, 2008 and Postmus’ Inland Empire PAC’s $2,000 donation on June 2, 2008, the San Bernardino County Taxpayers Association PAC received a substantial amount of money in the form of both contributions and loans, all from other political figures. On April 25, 2008, the Committee to Elect Paul Biane gave the San Bernardino County Taxpayers Association PAC a $15,000 contribution. On April 29, 2008 the Committee to Elect Dick Larsen provided the San Bernardino County Taxpayers Association PAC with a $10,000 loan. Larsen was then the county treasurer. On May 5, 2008 the Committee to Elect Gary C. Ovitt made a $15,000 contribution to Brown’s San Bernardino County Taxpayers Association PAC. That money may have originated with the Colonies Partners before being provided to Kirk’s Alliance For Ethical Government PAC and then being provided to Ovitt. On May 9, 2008, the Josie Gonzales for Supervisor campaign provided a $15,000 contribution to the San Bernardino County Taxpayers PAC. On May 16, 2008, Bill Emmerson for Assembly 2008 made a $5,000 contribution to Brown’s recently formed PAC. The same day, the San Bernardino Public Employees Association PAC provided Brown’s PAC with a $10,000 contribution. On May 23, 2008, the Committee to Elect Gary C. Ovitt provided Brown’s PAC with a $10,000 loan. On May 27, 2008, the Hansberger for Supervisor Committee made a $25,000 contribution to the San Bernardino County Taxpayers Association PAC. The next day, May 28, the Paul Cook for Assembly 2008 Committee provided Brown’s PAC with a $5,000 loan. The same day, the Committee to Elect Paul Biane made a $10,000 loan to Brown’s PAC. On May 29, Bill Emmerson for Assembly 2008 made a $5,000 contribution to the PAC and on June 2, 2008, the Hansberger for Supervisor Committee made a $15,000 contribution to the San Bernardino County Taxpayers Association PAC.
The lion’s share of the money Brown’s PAC took in was used to fund Hansberger’s effort to be reelected as county Third District supervisor that year. According to campaign disclosure documents, the San Bernardino County Taxpayers Association PAC on May 18 provided the Hansberger for Supervisor Committee with $57,030.70 and on June 30, 2008, more than three weeks after Hansberger had lost the election to Neil Derry on June 3, Brown’s PAC gave the Hansberger for Supervisor Committee $100,920.29.
The Fair Political Practices Commission interested itself in the lack of any subsequent accounting for the $35, 000.00 in loans made to the San Bernardino County Taxpayers Association PAC by the Larsen, Ovitt, Cook and Biane campaign committees. All references to those loans disappeared from subsequent campaign filing statements made on behalf of the PAC by Olchawa. The loans in question appear to be outstanding. No explicit reference to repayments to any of the lending parties can be found in any of the San Bernardino County Taxpayers Association PAC’s financial disclosure statements. While the online filing made by the Committee to Elect Gary Ovitt shows an outstanding loan of $10,000 to the San Bernardino County Taxpayers Association PAC as of 12/31/2010, online filings for the other lending parties have never been made available. There is no indication in any available documentation showing any of the loans were repaid.
No FPPC action was ever taken against the San Bernardino County Taxpayers Association PAC or Brown.
Despite the questions relating to the monetary transfers his PACs have been involved in and other outstanding issues, prosecutors are yet convinced that Brown can be effectively used as a witness in the prosecutions of Burum, Biane, Kirk and Erwin.
After Brown was approached by investigators in the Spring of 2009 and he agreed to become an informant for the district attorney’s office, he surreptitiously provided  information and material to prosecutors intended to put his boss – Biane – in prison.  That cooperation with prosecutors included Brown wearing a wire – a hidden audio recording device – while he was at work in Biane’s supervisorial office in an attempt to capture utterances by Biane that would implicate him in bribe taking.
About a year before the superseding indictment was handed down, the district attorney’s office, assisted by the county’s senior administrators, went to extraordinary lengths to protect Brown and separate him from Biane.  With much fanfare, Brown, who at that point in 2010 was still Biane’s chief of staff, filed a claim against the county, alleging Biane was retaliating against him. In the claim, Brown disclosed that he had been cooperating in the district attorney’s office’s investigation of Biane.
Biane, who had been the best man at Brown’s wedding and still considered Brown a trusted and close friend, was completely and utterly taken aback by the claim. He had no inkling, he said, that his chief of staff was working as an informant against him. More to the point, Biane was that year standing for reelection. The publicity about the matter redounded to his political disadvantage and after placing second in the June primary, he ultimately lost to his most successful challenger, Fontana councilwoman Janice Rutherford.
Before the 2010 election, at the apparent direction of county executive officer Greg Devereaux,  county auditor-controller-recorder Larry Walker brought Brown into his office as his second-in-command, making him assistant county auditor-controller, despite his lack of experience or expertise with regard to the duties of the office.
Brown remains as Walker’s top assistant following a reorganization in which Walker handed responsibility for the recorder’s function over to the assessor’s office and took on the added assignment of treasurer and tax collector. Brown retains the status, stature and credibility of being an assistant county department head. From that position he is thus likely to be called as a witness when the Colonies Lawsuit Settlement Public Corruption Prosecution goes to trial. In such a role, he will be counted upon to blast a hole below Biane’s water line, testifying that at the former supervisor’s direction he had used the San Bernardino County Young Republicans PAC to launder the bribe Biane had received from Burum in exchange for his vote to approve the $102 million lawsuit settlement.
Nevertheless, whatever story Brown is to tell is likely to raise as many questions as it will answer. Prosecutors can be selective in their questions to him, allowing him to put his best foot forward, claiming he was somehow innocently caught up in the corrupt political machinations of his one-time boss and best friend and closest political associate. Defense attorneys, however, will not likely allow it to escape jurors’ attention that had the same standard of conduct that was applied to Kirk been applied to him, he would have been indicted as well. And defense attorneys will probably also ask withering questions about the transferences of money into and out of the other PACs he founded or controlled, making it difficult for him to sell the idea that he had been a naïf manipulated by Biane in his operation of the San Bernardino County Young Republicans.
How well Brown holds up under that cross-examination could impact the outcome of the trial and whether the defendants will be convicted or exonerated.

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