There Really Is No Honor Among Thieves

A defense attorney's description of his client's former co-defendant after he decided to plead guilty and testify as a government witness is precious. Bernard Pylitt, who is defending William Spencer in the real estate fraud case involving the state of Indiana and Huntington Bank as its victims, told jurors in his opening statement that Indianapolis attorney Paul Page was a "pig" and a "thief" because he pulled money out of the business to which his client fronted money to purchase and turned down offers to flip the property for a quick profit. Bear in mind that his client is accused of keeping his ownership interest hidden so he could make money not only as the state's exclusive real estate leasing agent but as an owner of the property despite a specific prohibition against said ownership in his contract with the state. Larry Mackey, the attorney for Spencer's co-defendant, John Bales, assured the jurors it was only Page who did the lying in the transaction. The IBJ's Cory Schouten describes the humorous musings of Pylitt:

In his opening statement, Spencer attorney Bernard Pylitt called Page a "pig" for withdrawing $50,000 out of an account tied to the Elkhart building, a "pig" for turning down reasonable offers to sell the building, and a "thief" for collecting more than $150,000 in income from a building he got for free.

Pylitt suggested Bales and Spencer had no choice but to deal with Page's demands so they could meet a deadline to secure safe office space for the Department of Child Services. Other developers had turned down the deal, and Page only wanted in if he didn't have to put up any money.

Bales attorney Larry Mackey noted that his client is the only individual to lose money on the deal. Bales invested about $362,000, while Page borrowed the rest—about $931,000, including funds for preparing the space for occupancy—from Huntington Bank. He told the bank he would be the 100-percent owner with no other debt.

"Paul Page lied to Huntington Bank," Mackey said. "We're not going to disagree with that. Bales and Spencer had nothing to do with that lie."

Schouten oberves that neither side mentioned in their opening statements that Page had pleaded guilty to committing a crime already. Typically, defense attorneys argue to jurors that government witnesses who reach plea agreements with the government have a motive to lie in order to receive a lighter sentence for their own criminal wrongdoing. Page's attorney, Robert Hammerle, likened the attack of his fellow defense attorneys to Lance Armstrong's treatment of his teammates when they first came forward admitting their roles in illegal doping to win competitions. "These types of childish accusations remind me of Lance Armstrong's personal dismissal of former teammates who, like Paul Page, came forward and told the truth," Hammerle wrote in an e-mail. "Once he was forced to come out from hiding, Mr. Armstrong now looks like a colossal cheating fool, and who can trust him?" Schouten observes that calling Page a "pig" was actually an improvement over Bales' choice of name for Page's front company for Bales, L&BAB, which allegedly stood for "lazy and broke-assed bitch."

Mackey's claim that state officials approved of his client investing money into buildings the state planned to lease in order to get deals closed more quickly hit a bit of a roadblock with the government's first witness, Carrie Henderson, who headed up the Department of Administration from 2006-09 and oversaw Bales' contract. She recalled her reaction to Bales' suggestion that he could invest money in buildings the state planned to lease. "I told him that was creative, but we absolutely couldn't do that kind of deal with the state of Indiana, even if fully disclosed," Henderson said. "I made a very strong statement to say we can't do that kind of deal here. You have to be transparent. You can't work both sides of a transaction." Ouch!

Schouten said the government was expected to call Matthew Dwyer as its next witness, a former controller for Bales' company. Schouten says the defense plans to impeach Dwyer with evidence that he submitted a false insurance claim on a stolen vehicle at the same time he was allegedly giving false statements to the FBI. Yeah, there really isn't honor among thieves.