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United States v. Stone

September 24, 2007

UNITED STATES OF AMERICA,
v.
ALLAN STONE, DEFENDANT.



The opinion of the court was delivered by: Lewis A. Kaplan, District Judge.

MEMORANDUM OPINION

Defendant was indicted in 1992 for conspiracy, six counts of securities fraud, eight counts of failure to file statements of ownership with the Securities and Exchange Commission ("SEC"), eleven counts of mail fraud, fourteen counts of wire fraud, seven counts of money laundering, three counts of false statements, and one count of obstruction of justice. By the time the indictment came down, he had left the United States for Costa Rica. He finally was arrested by Costa Rican authorities in 2006 pursuant to a provisional arrest warrant and now awaits extradition to the United States. He moves here to dismiss the indictment on the ground that he has been denied his right to a timely prosecution and a speedy trial as allegedly guaranteed by the Fifth and Sixth Amendments.

Facts

Stone's motion suffers substantially from the fact that Stone himself has submitted no affidavit. His account is set forth principally in an affirmation and declaration of his attorneys, who quite plainly have no personal knowledge of the important facts, and unsworn e-mails and other documents that allegedly emanated from Stone. Nonetheless, the basic outline is clear enough.

Stone concededly left the United States for Costa Rica in April 1991,*fn1 a fact the government says it discovered in early 1992, prior to the return of the indictment.*fn2 The indictment was returned and an arrest warrant issued on March 24, 1992.*fn3 On April 13, 1992, the United States Attorney's Office ("USAO") submitted a request for a provisional arrest warrant to the State Department.*fn4 The Special Assistant United States Attorney states that she was informed that the Costa Rican government granted the request for a provisional arrest warrant on May 26, 1992, but no documentary evidence has been furnished.*fn5 In any case, however, it is undisputed that Stone was not arrested by Costa Rican authorities until 2006.

In an effort to cast blame on the government for the lack of an arrest between 1992 and 2006, Stone's counsel claim that he was living openly under his true name in Costa Rica. They seek to create the impression that the government had only to ask in order to have had him arrested. But the proof falls woefully short of establishing any such thing.

They begin with the assertion that Stone in 1991 obtained a Costa Rican driver's license in his own name.*fn6 The attorney who so claims, however, does not claim personal knowledge of that alleged fact. He simply attaches copies of what purport to be two Costa Rican driver's licenses in the name of Allan M. Stone, both purportedly issued on July 5, 1991 and expiring on March 8, 2006 and January 8, 2011, respectively. But the authenticity of these documents has not been established. No explanation has been offered for the existence of two of them, each with a different expiration date. In any case, neither document contains the licensee's address. Thus, even if the licenses are authentic, their existence does not establish that Stone's whereabouts were known even to the Costa Rican motor vehicle authorities, much less to the U.S. government.

To begin with, most of the four volume file is in Spanish, and Stone has not favored the Court with translations of its contents. It therefore is impossible to be certain that the file was opened in 2006. Even assuming that is the case, however, the fact (if it be so) that Costa Rica opened an extradition file in 2006 in response to the 2006 request for extradition does not establish the absence of such a request in 1992. Indeed, for all we know, there may be a 1992 extradition file that was opened upon receipt of a 1992 request for a provisional arrest warrant.

The next claim made by the attorney is that Stone was recruited by an acquaintance, Paul Lyles, to work under an FBI agent named Frank Banks to seek out U.S. fugitives in Costa Rica. He speculates that this required an FBI background check and states that "Banks [thereafter] informed defendant that [the check] revealed no prior charges or outstanding or pending arrest warrants."*fn7 The problems with these assertions are several, including:

* The attorney has no personal knowledge of the facts.

* A nationwide search of FBI employment records found no record of any FBI employee named Frank Banks.

* A global search of FBI records found no record of any confidential source or informant named Allan Stone.*fn8

In an effort to deal with this, Stone's counsel have submitted in reply an affidavit of Paul Lyles. Lyles claims that he recruited Stone in 1994 to assist in tracking down fugitives wanted by the FBI and that the two of them worked under the supervision of an FBI agent named Ken Kemp, not Frank Banks.*fn9 According to Lyles, Lyles told Agent Kemp that he wanted "Allan Stone" to work with him, gave him defendant's full name and other pedigree information, and was told some time later that there were no warrants on Allan Stone.*fn10 Despite its improbability and its clear inconsistency with the affirmation previously submitted by Stone's attorney, the Court for present purposes assumes the truth of Lyles' assertions.

Next, Stone's attorneys claim that Stone repeatedly was in touch with the U.S. Embassy in Costa Rica beginning in 1998*fn11 and that the Embassy knew his address.*fn12 Again, however, counsel has no personal knowledge of the facts. The only documentation that has been submitted to back up these contentions consists of a letter from a vice consul addressed to Stone in care of one Bernardo Porras Paniagua*fn13 and a purported letter from Stone ...


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