Benzer to plead guilty in Las Vegas HOA scheme

Leon Benzer, the alleged mastermind of the massive scheme to take over homeowners associations in the Las Vegas area, is scheduled to plead guilty in federal court Friday.

Benzer had previously pleaded not guilty. His change of plea comes a month before his long-awaited trial in the high-profile case and leaves five defendants, including one of his former lawyers and his half-sister, to face a jury.

The electronic court docket says Benzer is to appear at 10:30 a.m. Friday before U.S. District Judge James Mahan, who is presiding over the case.

His defense lawyer, Daniel Albregts, could not be reached for comment Thursday.

Benzer, 47, a former construction company boss, and 10 others were indicted by a federal grand jury in January 2013 on conspiracy and fraud charges.

Since then five of the defendants, including attorney Barry Levinson, have pleaded guilty.

The sweeping investigation that led to the indictment, spearheaded by the Justice Department’s Fraud Section in Washington, is thought to be the largest public corruption case federal authorities have brought in Southern Nevada. The FBI, Las Vegas police and IRS all played key roles in the investigation, which was launched in 2007.

Benzer, who once owned Silver Lining Construction Company, is facing separate tax charges tied to the takeover scheme, which prosecutors say occurred between 2003 and 2009.

Roughly three-dozen defendants have pleaded guilty in the case since August 2011.

One defendant, attorney David Amesbury, committed suicide in March 2012, days after a key target of the investigation, construction defects lawyer Nancy Quon, took her own life. Quon was never charged.

The 2013 indictment called Benzer and Quon masterminds of the conspiracy and its “principal sources of funding.”

Benzer, Quon and others funneled more than $8 million through secret bank accounts to land lucrative legal, construction and community management contracts from the homeowners associations, the indictment alleged.

The conspirators, through election rigging and other dirty tricks, packed association boards with members who handed out contracts worth millions of dollars at the expense of the homeowners, according to the indictment.

Benzer and company unlawfully put in place straw buyers at 37 condominiums in the developments they targeted, court documents said.

Prosecutors identified 11 condominium associations in the indictment as victims of the scheme: Vistana, Park Avenue, Chateau Versailles, Chateau Nouveau, Jasmine, Sunset Cliffs, Palmilla, Pebble Creek, Mission Ridge, Mission Pointe and Horizons at Seven Hills.

Among those left to stand trial Feb. 23 are one of Benzer’s former civil attorneys, Keith Gregory, and his half-sister, Edith Gillespie.

Earlier this month, a federal judge denied a defense motion to dismiss the criminal case because of government wrongdoing.

Defense lawyers contended prosecutors committed misconduct that allowed the Las Vegas Review-Journal to publish an Oct. 30 article revealing details of failed plea negotiations between Benzer and the government in 2011.

The article, which contained information Benzer provided investigators during the secret talks, was based on government reports the newspaper obtained from the electronic court docket while they were public for two days in September.

The FBI and Las Vegas police reports, which have since been sealed and stricken from the court record, are based on interviews with Benzer discussing how he corrupted HOA boards through bribery and ballot stuffing to obtain millions of dollars in construction defect contracts.

In his decision, U.S. Magistrate Judge George Foley, Jr. said he found no government misconduct that rose to the level of dismissing the case.

Defense lawyers had suggested in court papers that the Review-Journal got the reports from prosecutors, an allegation denied by both the prosecutors and the newspaper.

Last month, Foley denied a defense request to move the trial out of Las Vegas because of what the lawyers said was prejudicial news coverage by the Review-Journal that made it impossible for the defendants to get a fair trial.

Foley ruled the newspaper’s stories were “factual in nature” and not inflammatory, as the defense argued. He said any potential jurors influenced by the news coverage could be weeded out during the selection process at trial.

Contact Jeff German at jgerman@reviewjournal.com or 702-380-8135. Find him on Twitter: @JGermanRJ.