INDIAN RIVER COUNTY — After nearly 150 witnesses and roughly 375 separate pieces of evidence used in a four-week prosecution of the 46 charges against disbarred attorney Ira Hatch, the state could rest its case today.
On Tuesday, FBI Special Agent Rick Miller was cross-examined by defense attorney Gregory Eisenmenger for nearly four hours, mostly about information contained in 36 white banker’s boxes full of closed client files.
Many of the files dated back earlier than 2004, prior to dates of charges filed against Hatch for grand theft, money laundering and racketeering.
The closed files contained records of depositors who had received their money back from Coastal Escrow Services prior to the business shutting its doors on Sept. 4, 2007.
Miller examined records and bank statements related to the estimated 800 people whose money was still on deposit and lost when the business closed. Eisenmenger argued that there were records Miller had not reviewed in an effort to diminish the weight of his testimony against Hatch.
Eisenmenger pressed Miller to explain why he did not completely reconstruct the money trail of every one of Coastal Escrow and Hatch and Doty’s financial transactions over the years in question.
Miller said the project would have taken “a couple of years” to complete.
Though the prosecution did not object during Eisenmenger’s questioning, Assistant State Attorney Lev Evans addressed the relevance of the exhaustive examination of the documents in the closed files during redirect.
“These are all closed files and I’m not aware of any missing money regarding these files,” Miller said in response to questioning. “I didn’t see the need to focus in depth on these closed files.”
Eisenmenger also had Miller review old printouts of ledgers and financial reports before and after a system upgrade to compare manual journal entries transferring old account balances to an upgraded bookkeeping system.
Bruce Lennon, who worked as a courier for Coastal Escrow Services, Coastal Title and Hatch and Doty for two and a half years prior to the Labor Day 2007 shutdown testified to a change in his normal pickup and delivery schedule in the last days.
Lennon, who was hired on when he was married to former Coastal Escrow Services office manager Amelia Lennon, said over the summer of 2007 he was told to change his route to prioritize the pickup of funds from Realtors and title companies, instead of doing the pickups later in the day on his travels.
Amelia Lennon testified Monday that getting enough money into the Coastal Escrow and Hatch and Doty accounts by 2 p.m. to cover checks that were about to clear was a daily scramble for bookkeepers. Despite their best efforts, 1,138 checks written from Hatch’s businesses bounced between 2004 and 2007.
Computer software technician Carlos Muentes, who had set up computers and done programming work for Hatch, testified that Hatch called him twice, in September and October 2007, wishing to purchase software capable of wiping out computer hard drives. Eisenmenger argued that Hatch wanted to donate the computers to charity and felt a responsibility to clear all confidential client information from them first.
“If they were going to be donated to charity, I was not aware of that,” Muentes said upon redirect examination by Evans.
Muentes said he did not provide Hatch with the software that would irretrievably delete information from the hard drives.
Vero Beach Police Detective and K-9 officer Rick Lombardo testified to following Hatch into the parking lot of the Transocean Office Center on Oct. 23, 2007 just after midnight and observing him carry out a file cabinet on a dolly and load it into the back of the White GMC Yukon registered to Marjorie Hatch.
He also observed Hatch tossing a trash bag into a dumpster.
“He stated that he had permission to be there after hours and he had been there nights before and would be returning to retrieve personal items,” Lombardo said.
Mortgage broker David Stinnet testified that Hatch came to him in the summer of 2007 in search of a loan of $1 million to $1.5 million using a real estate project in Orlando as collateral.
Stinnet said that he could only find a high interest “hard equity” loan for Hatch charging 14 to 16 percent plus substantial points. When Hatch heard the terms of the proposed loan, Stinnet testified Hatch told him to try for $3 of $4 million instead.
The deal ultimately fell through and Hatch did not get the loan that would have presumably kept Coastal Escrow Services afloat.
Stinnet also testified about a meeting he had with Hatch about a week before Coastal Escrow closed.
“Mr. Hatch asked me to follow him into his office and he wanted to give me a head’s up, he told me that he had done things he shouldn’t have,” Stinnet said. “I told him, ‘Ira, we’ve all done things we shouldn’t have’ and he said ‘yeah but this may cost me my license.'”
Two other witnesses had previously testified that Hatch had told them he would be getting a large loan that would allow him to pay back the Coastal Escrow depositors of all the money that had been transferred out of the account.
The prosecution has shown that those funds were used to cover expenses of Hatch and Doty, as well as mortgage payments on the Hatch family home and lease payments on three BMWs driven by Hatch and his children.
In addition, testimony has been given that Hatch received a salary of $200,000 to $250,000 per year, though evidence has also shown that Hatch and Doty accounts ran at a loss for several years prior to the shutdown of Coastal Escrow.
Expected to testify today are one of the state’s accounting experts, possibly a couple of people who lost money on deposit with Coastal Escrow and Vero Beach Police Detective Lee Evans, who served three search warrants on Hatch and seized computers and a small warehouse full of records from Coastal Escrow and Hatch and Doty.
Depending on the extent of cross-examination by Eisenmenger, which he said would “take a while,” the state could close at lunchtime or sometime this afternoon.
If the state wraps its case today, the attorneys expect to argue over the 46 charges the state has filed against Hatch Thursday. The defense could present its case beginning Tuesday after the July 4 government holiday on Monday.