U.S. District Judge Larry Hicks listens to Assistant U.S. Attorney Daniel Schiess argue for a stiff sentence and fine for former Clark County Commissioner Lance Malone. Illustration by David Stroud.
Convinced that Lance Malone helped orchestrate "the rankest corruption of local government" in state history, a federal judge Wednesday sentenced the 45-year-old former Clark County commissioner to prison for six years.
U.S. District Judge Larry Hicks also levied a $100,000 fine against Malone, who in September pleaded guilty to serving as strip club owner Michael Galardi's bagman.
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Malone, a Republican, admitted that between 2001 and 2003, he paid cash bribes to his former Democratic colleagues Erin Kenny, Mary Kincaid-Chauncey and Dario Herrera in exchange for the commissioners' votes in favor of Galardi's business interests.
Hicks said Malone facilitated Galardi's corrupt enterprise because he recruited the commissioners to become part of the bribery scheme.
"There is no question Lance Malone traded up on his history on the Clark County Commission," Hicks said during a lengthy tongue-lashing of Malone.
"He'd come to know Erin Kenny, he'd come to know Mary Kincaid-Chauncey and he'd come to know Dario Herrera.
"He traded up on that knowledge when he was voted out of office."
Malone stared straight ahead as Hicks announced the sentence, by far the harshest imposed so far in the political corruption case.
Hicks ordered Malone to begin serving his sentence by April 9. Malone, who was a Metropolitan Police Department officer before his 1996-2000 stint on the commission, requested assignment to a federal prison in Oregon or California.
Malone left the courtroom comforting his mother and declined to speak to reporters.
When asked to sum up the judge's ruling in a single word, Malone's lawyer, Dominic Gentile, first muttered, "Shit." He then said: "Ouch."
U.S. Attorney Daniel Bogden and Assistant U.S. Attorney Daniel Schiess, who prosecuted Malone, said the sentence was fitting.
"Judge Hicks is an outstanding judge. I think he made a fair decision," Schiess said.
Bogden echoed Hicks' opinion that the only way to stop corrupt politicians is by doling out significant prison sentences.
"These are the kinds of things we set out to try to put an end to," Bogden said. "We've been at least able to put a dent in it."
After a jury convicted Herrera and Kincaid-Chauncey of pocketing bribes offered by Malone, Herrera received a 50-month sentence, and Kincaid-Chauncey was sentenced to 30 months.
Malone's sentence will run concurrently with a three-year sentence he was given in San Diego, where in 2005 he was convicted of similar charges in a parallel case.
Hicks' decision Wednesday left Gentile wondering whether it was wise for Malone to sign a plea agreement rather than fight the charges during trial. He said Malone would have faced the same sentencing calculations had he gone to trial and lost.
But, Gentile said, he had been worried about the wild-card testimony of Galardi, who pleaded guilty in 2003 and has assisted the government since. Jurors in the San Diego trial found Galardi's testimony to be believable despite Gentile's assertions that it was packed with lies. Gentile contended that Galardi was willing to say whatever the government wanted to hear in order to receive a more lenient sentence.
"You never know what Mike Galardi would say," Gentile said. "You never know what he's going to say next."
Before Hicks' ruling, Malone addressed the judge and explained his decision to work for Galardi.
"I did start out with good intentions, but those good intentions turned horribly, horribly wrong," Malone said. "I was confronted with something I've never been confronted with before, and that was greed."
Malone choked back tears when he relayed a conversation he had with his 8-year-old son one night.
"He said, 'Dad, are you going to prison?'" Malone, the father of two young boys, told Hicks. "I said yes, and he hugged me so hard and said, 'Well, I'm not going to let you go.' "
Malone's plea for leniency fell on deaf ears.
"If there ever needs to be a message on political corruption, it is this case that outlines all the reasons and need to create a deterrence to public officials and would-be public officials," Hicks said.
The Bureau of Probation and Parole submitted a report to Hicks in December saying the total amount of bribes involving Malone amounted to less than $200,000.
Hicks, however, placed the total at $550,000.
Instead of a sentence of up to 41 months in prison as bureau officials recommended, Hicks' calculations put the sentencing range at 62 to 78 months.
The amount of bribes Malone paid or intended to pay in addition to whether he accepted bribes while in office were key issues in determining whether to boost his sentence range. Also adding to Malone's sentence was the government's successful argument that he was an integral cog in the scheme.
Gentile urged Hicks to follow the opinion of U.S. District Judge Jeffrey Miller, the San Diego judge who ruled that Galardi orchestrated the illicit plot to bribe elected officials. Hicks disagreed.
"This was a completely different and far more sinister case in Las Vegas," Hicks said.
"There is no doubt that the leader was Michael Galardi, and he was in control by virtue of the cash he had so readily available to him. The fact is he couldn't have done what he did without someone like Lance Malone," he said.
Hicks said he believed Malone was corrupt while he served on the commission. The government convinced him that Galardi met with Malone in 1999 to push for an ordinance increasing distances between strip clubs. The strategy was to keep competition out.
Shortly after a key vote on the ordinance, the government contends Galardi gave Malone $20,000 to use as a down-payment on a luxury sport utility vehicle.
"The court is satisfied there was a $20,000 payment to Lance Malone," Hicks said.
In tallying up the amount of corruption money to use in calculating Malone's sentence, Hicks said he believed Malone paid Herrera at least $78,000, Kenny $70,000 and Kincaid-Chauncey $20,000 over the three-year period. Hicks added in $100,000 that Galardi said he offered to pay Kenny to skip her bar exam and vote on an important matter related to his business.
Hicks also included the $42,000 that Malone was accused of paying San Diego City councilmen as well as the income Malone received from Galardi.
"Lance Malone received direct compensation from Michael Galardi of $200,000 for his various activities tied directly to the illegal payments identified by the court," Hicks said.
The judge said he also believed that Malone intended to pay $20,000 to then-Business Licensing Director Ardel Jorgenson for her help in the permitting process for Galardi's new club, Jaguars.
The only victory scored by Malone on Wednesday was Hicks' ruling on an allegation that Malone accepted a $250,000 bribe from Triple Five Development in exchange for his favorable vote on a controversial neighborhood casino.
Schiess argued that Malone and local businessman Donald Davidson planned to split the money offered for Malone's vote.
Davidson, 72, has been indicted on charges that he paid Kenny $200,000 for her vote on a zone change allowing a CVS Pharmacy to be built in a residential neighborhood. Schiess said Wednesday that Malone played the role of a middleman in that scheme, too.
Hicks said the accusations related to the Triple Five casino were unrelated to the charge to which Malone pleaded guilty. The determination of what happened during the Triple Five negotiations "will have to wait for another day," Hicks said.
Hicks relied on a series of intercepted phone calls involving Malone when he made his ruling on the cash deals that occurred in the case.
"I have never seen such potent evidence as the wire intercepts seen in this case," Hicks said.
Hicks allowed the defense and government two weeks to decide how much money Malone should forfeit. Schiess laid out his argument on Wednesday.
Schiess suggested that the money and gifts Malone received from Galardi amounted to $410,000. Galardi leased a Mercedes for Malone, treated his family to a vacation in Hawaii and paid Malone handsomely, he said.
Over a 20-month period, Malone collected $1 from every transaction made on the ATM machine at Galardi's Cheetah's topless club. That amounted to about $4,000 a month or a total of $80,000, Schiess said.
Schiess also plans to file a motion to go after some of the assets that were transferred to Malone's wife, Rosemary Malone-Palacios, when the couple divorced just days before Malone went to trial in San Diego. The federal government has alleged it was a sham divorce designed to try to protect Malone's assets from seizure.
Malone later claimed he could not afford attorney fees. The legal bills were footed by the government under the Criminal Justice Act, which requires defendants to have access to adequate representation.
Schiess argued that Malone intended to keep his assets away from the government. He will seek enough assets to reimburse the federal fund used to assist defendants who truly cannot afford attorneys.
"Lance Malone divorced on the eve of the San Diego trial" and kept "absolutely zero assets" in the divorce, Schiess said.
His assets before the divorce included a Merrill-Lynch account of more than $300,000, a house worth at least $500,000 and a Subway sandwich franchise in The Orleans hotel-casino. Shiess said that in 2005, Malone's Subway was the fifth-highest grossing Subway in the world.
Malone's sentencing is not the last in the political corruption scandal. Kenny, who pleaded guilty in 2003, and Galardi will be sentenced later this year.
Both are slated to be sentenced in the first week of March, but Kenny's sentencing is expected to be postponed until after Davidson's trial, which is scheduled to begin March 26.
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