Remember LASV Taki?
SEC target Zaba's Kelowna lawyer not guilty in Texas
2006-04-06 16:55 ET - Street Wire
Also Street Wire (U-LASV) LASV Enterprises Inc
Also Street Wire (C-*BCSC) BC Securities Commission
by Stockwatch Business Reporter
A Texas jury has acquitted Bruce Allard Paige, the Kelowna lawyer for ailing B.C. stock promoter Robert Stanley Zaba, of theft. Meanwhile Mr. Zaba, who was the lead defendant, is in an undisclosed B.C. nursing home after suffering an aneurysm in a Texas jail.
Houston Police arrested Mr. Zaba, Mr. Paige and a third associate, Patrick Hood, in August, 2004, for a variation of a Nigerian advance fee scheme. According to prosecutors, Mr. Zaba told retired Houston lawyer Michael Pullara he had millions in overseas bank accounts, but he needed $80,000 to spring it free. In return for a short-term $80,000 loan, Mr. Zaba allegedly offered to repay $500,000, a generous return. (All figures are in U.S. dollars.)
It seems Mr. Pullara was more interested in having Mr. Zaba arrested than lending him money, however. After setting up a meeting to arrange the loan, Mr. Pullara invited a receiving party that included the Houston Police, the FBI and the Secret Service.
Once Mr. Zaba signed a loan contract, police quickly appeared to arrest Mr. Zaba, Mr. Paige and Mr. Hood. Mr. Zaba was found incompetent to stand trial and shipped home after his aneurysm, leaving Mr. Paige, the Kelowna lawyer, and Mr. Hood, a Houston resident, to stand trial.
In the two-week trial, Mr. Paige's lawyer, Norm Silverman, successfully argued Mr. Paige was just there to inspect the contract between Mr. Zaba and Mr. Pullara. Mr. Paige was not a party to the dubious deal. After eight hours of deliberations, a Texas jury agreed, and acquitted Mr. Paige of theft.
Mr. Paige did not testify in his own defence. Testifying for the prosecution was Mr. Pullara and Houston Police Sgt. Joel Gorski.
After the acquittal, prosecutors quickly dropped the case against Mr. Hood, the Houston resident who introduced Mr. Zaba to Mr. Pullara. The end result -- all three accused went home free men.
Mr. Zaba may be fortunate he did not go to trial. "The DA could not have lost [against Zaba] ... it was a done deal," says Paul Mewis, lawyer for co-accused Mr. Hood.
Although the Houston ordeal is now behind Mr. Zaba, he could be at the end of his career. The aneurysm, which was the second for the 50-year-old promoter, apparently left him with reading and mobility problems.
Mr. Zaba is likely in a nursing facility near the small B.C. town of Vernon, where his wife Seka lives. The B.C. Ministry of Health, citing confidentiality, would not disclose his specific location.
Mr. Zaba's poor health has also got him out of civil fraud charges from the Pay Pop Inc. promotion. In that case, the SEC says Mr. Zaba pumped the stock to $1.78 using a purported Dominican Republic resort and a leased phone line operation in Vancouver. Prosecutors dropped the case against Mr. Zaba last month, citing his health.
Not as fortunate were the other Pay Pop accused, CIBC Mellon Trust, CIBC transfer agent Alnoor Jiwan and Mission resident Daryl Desjardins. The SEC won a $5.3-million penalty against Mr. Desjardins, a $6-million penalty against CIBC Mellon Trust and a $130,374 fine against Mr. Jiwan for the pump-and-dump.
According to the SEC, Mr. Zaba and Mr. Desjardins used Pay Pop as a "printing press" for money, bribing CIBC transfer agent Mr. Jiwan to issue millions of unrestricted shares.
The SEC was less understanding of Mr. Zaba's health problems last summer. Right after Mr. Zaba had his second aneurysm, the SEC sought and won a $2.6-million default judgment against him for the LASV Enterprises pump-and-dump. The SEC says he pumped LASV from 43 cents to $3.03 using a purported New York airline deal, among other things.
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