Tuesday, Sept. 2, 2003 | 11:02 a.m.
Former Clark County Commissioner Lance Malone was expected to surrender to authorities in San Diego today and will be arraigned Wednesday in connection with last week's public corruption indictments, according to staff at his attorney's office.
Another defendant in the case, Cheetahs' San Diego manager John D'Intino, was scheduled to appear in federal court in that city this morning. He was expected to plead guilty as part of an agreement with prosecutors, federal officials said today.
Officials in the U.S. Attorney's office in San Diego had no comment on Malone or D'Intino, or about when they would appear in federal court.
Michael Galardi, the owner of topless clubs in Las Vegas and San Diego, was one of five men who pleaded not guilty to fraud and other charges Friday in connection with alleged bribery of San Diego city councilmen in an attempt to loosen regulation of the clubs.
Also pleading not guilty Friday in U.S. District Court in San Diego were three of that city's councilmen, Michael Zucchet, Ralph Inzunza and Charles Lewis, as well as Lewis' aide David Cowan.
Galardi was released after posting a $250,000 bond, while each of the others was freed on $25,000 bond. All five are scheduled to return to court on Oct. 23 for a motions hearing.
Galardi, who runs Cheetahs and Jaguars in Las Vegas and Cheetahs in San Diego, Malone and D'Intino are charged with wire fraud, extortion and racketeering. The councilmen are charged with wire fraud and conspiracy to commit wire fraud in connection with taking bribes and illegal campaign contributions from Galardi and his associates.
Cowan is charged with making a false statement to the FBI.
The indictment alleges that from August 2000 to May 14, 2003, Galardi, Malone, who was working as Galardi's lobbyist, and D'Intino used "straw" contributors to disguise the true source of campaign funds paid to the councilmen in an effort to repeal a "no touch" provision at strip clubs.
A "no touch" ordinance similar to San Diego's, which made it illegal for topless dancers to touch patrons at strip clubs, was considered and initially passed by the Clark County Commission last year. That law was repealed due largely to the efforts of commission Chairwoman Mary Kincaid-Chauncey and former commissioners Dario Herrera and Erin Kenny, who are all alleged targets or subjects in a parallel political corruption investigation in Las Vegas.
The FBI's Las Vegas investigation remains open and became public after Galardi's clubs and office were raided on May 14, the same day that the San Diego councilmen's offices were searched by authorities.
In Las Vegas FBI agents were looking for records of payments or gifts to Kincaid-Chauncey, Herrera, Kenny, and former Las Vegas City Councilman Michael McDonald. Also named in the search warrant were Kincaid-Chauncey's husband, Robert Chauncey, Herrera's wife, Emily, and Kenny's husband, John.
No indictments have been handed up by a federal grand jury in Las Vegas in connection with the more than two-year FBI investigation, but that could soon change, according to a former FBI organized crime expert.
George Togliatti, a former organized crime expert for the FBI, says he expects "imminent" indictments from locally based federal officials after the San Diego grand jury's indictments.
"The action in San Diego is quicker than I thought it would be," Togliatti said on Friday's edition of "Face to Face With Jon Ralston" on Las Vegas ONE, Cox Cable channels 1 and 39.
The Las Vegas investigation is separate, but with the San Diego grand jury acting quickly, Togliatti said, he believes local indictments could come this week or next.
"That's my guess," Togliatti said. "I expect something in Las Vegas very, very soon."
Wiretaps cited in the San Diego indictment could outline a pattern of bribery, Togliatti noted.
"There are some pretty nasty sound bites," Togliatti said. Although it is hard to prove corruption cases, he said, some of the information in the 26-page indictment is "awesome from a prosecution viewpoint."
So far the public has seen and heard snippets from taped conversations, Togliatti said. There could be more in the Las Vegas indictments, "something they can bring full circle," he said.
"There's going to be a lot of fireworks here," Togliatti said. "You have to have enough stuff out there right away so you know they weren't on a fishing expedition. We're just looking at selected pieces. There are a whole lot more under that."
Whether Kenny or others will strike a deal with prosecutors is uncertain, Togliatti said.
Kenny has reportedly told friends that she is cooperating with investigators.
After the raids Kincaid-Chauncey told the Sun that the Galardis had contributed to a trust fund for which she raises money. Since that statement, she has refused to elaborate on contributions to the trust fund. She has repeatedly said she did nothing wrong and as recently as last week she insisted that she never took money from Malone.
"I was surprised (to see her on television), because I was certain any lawyer would tell her not to," Togliatti said. "In her heart she thinks she did nothing wrong."
But, he added, "if there is a tape contradicting Kincaid-Chauncey of taking money from Lance Malone, it could be devastating."
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