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Stracener mailer attacks Hoffman: Allegations ‘much ado about nothing’

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From page A1 | May 25, 2012 |

A mailer sent out as part of El Dorado County Superior Court Judge Warren “Curt” Stracener’s reelection campaign has stirred controversy over opponent Joseph Hoffman.

The mailer alleges that “Joseph Hoffman may have aided Daniel Chartraw in the commission of interstate fraud.” As previously reported in the Mountain Democrat, between Jan. 1, 2007, and Nov. 31, 2011, court documents allege that Chartraw made false statements and promises in order to obtain money in the form of loans, investments and “various commodity purchases.” He collected approximately $2.4 million from investors.

Money was wired through a client trust account that Hoffman provided to Chartraw as part of being his retained attorney. The money was allegedly part of Chartraw’s fraud scheme.

“It’s an extremely common practice,” said former U.S. Attorney for the Eastern District McGregor Scott of having a client trust fund. “It’s the client’s money” held in the trust fund, he said. Such accounts operate “literally every day, every week, as a function of the law practice.”

The fund is meant as a holding area for the client’s money. That money can be later used to pay retainer fees, or, should the client lose the court case, be dispersed as restitution or settlement, Scott said. It is not meant for the attorney to use except for official court-approved purposes, or to pay himself as agreed upon, in writing, by the client.

El Dorado County Superior Court Judge Douglas C. Phimister agreed that nothing appeared out of the ordinary.

“You are required to have a trust account” as a lawyer, he said. “It’s not for hiding money for clients, it’s for holding to give out for a given purpose.”

Hoffman, according to the mailer, is being sued by a victim for the stolen money. Phimister said the solution to that is simple — a writ of execution, signed by the sheriff, would allow the victim to easily get the money back after proving the money is theirs.

Greg Jones, a spokesman for Hoffman, said the matter was “Nothing out of normal, how trust accounts are used every day.” He said it’s “Much ado about nothing” and that the mailer is meant to “distract viewers from (Stracener’s) own deficiencies.” The account is government-regulated, he said, and thus there is transparency and accountability. “Every attorney I’ve spoken to about it says the same thing, that it’s much ado about nothing.”

Jones also mentioned that since the information on a supposed connection between Hoffman and Chartraw’s crimes have come to light, they have not lost any endorsements, but instead gained endorsements, as lawyers knew there was nothing wrong with the client trust fund, Jones said.

Meanwhile, Stracener has lost the support of former Supervisor Rusty Dupray, who said he endorsed both Stracener and Hoffman early on in the campaign, but “after more research and talking with Hoffman endorsers,” after after reading the Village Life article on Stracener he dropped Stracener and kept his Hoffman endorsement.” In an e-mail to Stracener, Dupray wrote that he was “withdrawing my endorsement of you, and ask that you remove my name from your campaign materials and Website immediately.”

On the topic of endorsements, one of Stracener’s mailers claims he is endorsed by the “El Dorado Tea Party.” Bill and Dena Freeman, founders of the Tea Party of the Hills, have not heard of that party, nor do they endorse Stracener.

“I checked with every Tea Party in the area, none know of that Tea Party,” Dena Freeman said, who said none of the Tea Parties in the area endorse candidates.

“We don’t know where the El Dorado Tea Party came from. We’ve never heard of it,” Bill Freeman confirmed. When asked if they had endorsed Stracener, he said “It’s not true. A falsehood.”

The mailer also mentions that Hoffman wrote a letter verifying Chartraw had gold-and-silver bars from mining worth $6 million, claiming it could be part of the fraud. However, the letter is not mentioned in the federal indictment of Chartraw. In other words, no legal action has been taken against Hoffman due to the letter.

“Is Chartraw a crook? Probably. Did Hoffman facilitate any action in a knowing way? No,” said Scott.

Instead, Scott said, the connection with Hoffman to Chartraw is just a way for a higher court to claim jurisdiction, as the federal court can lay claim over cases involving interstate commerce.

“It’s typical in a fraud case to use wire transfer or the use of mails to move” money and items, Scott said. “That way, they can be accused of wire fraud. That’s a jurisdictional requirement … it’s a procedural requirement only, there’s no bearing on Hoffman.”

When asked if Hoffman had done anything illegal, Scott replied “Absolutely not, in no way, shape or form.” On the matter of whether there might be an unindicted co-conspirator in the case, which could be Hoffman, Scott said that “Not a single work alleges anyone other than Chartraw of wrongdoing.”

Phimister claimed instead that Stracener had done some wrongdoing in contacting the lawyer on the other side of the pending litigation from Hoffman, without contacting Hoffman at the same time. This is known as ex parte communication, and is a violation of Judicial Canon. “It’s required that he has to self-report” his infraction to a judicial conduct committee, Phimister said.

District Attorney Vern Pierson, who had seen the mailer before it was sent out, told Stracener’s campaign that it was a “complicated case of nothing.”

Upon learning that calls to Stracener for comment on the matter were not returned, Pierson said, “For someone who calls himself a superior court judge, it’s sad and pathetic to disparage someone without substantiation, and he doesn’t have the backbone to respond to a reporter’s phone calls.”

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