spacemanspiff
New member
i skipped posting a few articles on the Security Aviation drama over the last few weeks, they didnt really have anything interesting in them. but heres one that is intriguing:
http://www.adn.com/news/alaska/security_aviation/story/7599135p-7509582c.html
FBI suspected raid on trust in Security Aviation growth
AFFIDAVITS: Prosecutors say "mountain of information" led officials to suspect fraud.
By LISA DEMER and RICHARD MAUER
Anchorage Daily News
Published: April 5, 2006
Last Modified: April 5, 2006 at 02:55 AM
Security Aviation Inc. executives lied about winning massive government contracts for war games and covert operations to cover up what authorities suspected was the real source of their money: a raid on a private trust connected to company owner Mark Avery, federal prosecutors assert in new court filings.
Avery and his associate, Rob Kane, led the company in an explosion of growth starting in July 2005, purchasing executive jets, helicopters, Warsaw Pact military planes, vehicles, real estate, boats and businesses in Alaska and Nevada with no apparent worry over costs, financing or payroll. Last fall, Kane said that Security Aviation and another company owned by Avery spent $54 million in 10 days, the government says in one of the new documents.
The latest round of filings in U.S. District Court show that federal authorities had been investigating the pair since at least October.
The new documents, filed this week, are part of the government's efforts to fight off attempts by lawyers for Security Aviation and Kane to suppress evidence seized in searches in February. Security Aviation and Kane are under indictment on charges of illegally possessing and transporting Russian rocket launchers for the '70s-era Czech military jets.
The government's responses are loaded with startling revelations about the government's investigation into Avery's rapid buildup of Security Aviation and related companies. Both sides have lifted snippets out of sworn statements filed by an FBI agent to convince Magistrate Judge John Roberts to issue a series of search warrants between Feb. 1 and Feb. 3. The filings don't give the whole picture, and the affidavits are still under seal. But prosecutors said the affidavits present "a mountain of information" that led them to suspect that fraud was committed against the trust and an Anchorage bank.
The new documents reveal that:
• Kane told a witness he and his Alaska associates "are currently engaged in 'black ops' and that he claimed to be transporting detainees for the U.S. government from overseas." Kane claimed they had Defense Department contracts to serve as opposition forces in training missions and "evacuation contracts with 300 embassies and consulates in the Pacific Rim region."
The Defense Department, the State Department and the Air Force all denied the existence of such contracts, prosecutors wrote.
• Kane boasted, sometimes in outlandish or contradictory terms, about money. He told one former Security Aviation employee on Jan. 26 that "I have more money than God" and another government witness that he was worth $660 million he had inherited from a presidential adviser who had died the previous year. But he also told a government agent that "Avery is the money man."
• Kane insisted on strict computer security measures including e-mail and data encryption and emergency data destruction systems. "Kane and Avery advised two witnesses that they required extraordinary computer and communications security, including CIA grade encryption, to protect a 'trust' and their companies from unspecified outsiders who will scrutinize multimillion-dollar international wire transfers by Avery and Kane," prosecutors wrote.
• Kane was involved in earlier government investigations involving the "illegal possession of automatic weapons, grenade launchers, and hand grenades, among other items including the use of a rocket launcher in Oregon in 2003," prosecutors wrote. They do not specify whether Kane was a target of those investigations. The rocket launchers in the current case are designed to be mounted on planes, but other types can be shoulder-held.
Avery is one of three trustees for the May and Stanley Smith Charitable Trust, which prosecutors say was the suspected source of a $50 million "loan" that fueled "Avery's extensive and multimillion-dollar investment into Security Aviation and a horde of other business ventures, none of which were charitable in nature."
The government is relying heavily on comments purportedly made by Kane and Avery themselves, in particular assertions that their money came from a trust. While those claims led to the original searches, prosecutors have not said whether they have uncovered evidence showing the Smith trust was plundered to cover Avery and Kane's investments.
The search warrant affidavits by FBI special agent Matthew Campe list both specific and general claims of wire transfers of funds into Avery's businesses through Wells Fargo Bank and other means, says one government filing, by assistant U.S. Attorney Steven Skrocki.
"Both men made mention of a 'trust' and Avery in particular made reference to a 'loan,' " the government says. Investigators suspected when they sought the search warrants that "the source of Avery and Kane's incredible expenditures in such a short period of time, at least $50 million, came from a raid on the May and Stanley Smith Charitable Trust either via the trust itself or through some type of shell company," the government says.
Defense lawyers have said that the money fueling Security Aviation and other businesses is legitimate and the government has overreached in its case involving the rocket launchers. The only criminal charges so far revolve around the fact that Kane and the company failed to register the launchers. Defense lawyers say that's essentially a paperwork issue. On Tuesday, a Security Aviation lawyer declined to comment on the newest government filings.
The Smith trustees each are paid $400,000 a year to administer the trust, which was established by Avery's father, Luther Avery, a celebrated tax and estate lawyer in San Francisco. Mark Avery inherited his seat on the trust after his father died in 2001.
The other two trustees, investment adviser John P. Collins Jr. and retired accountant N. Dale Matheny, are both Californians, and the trust has operated out of Matheny's office on Market Street in San Francisco. According to the new government filing, the trust stopped filing records in California after March 2004 because it had moved. Investigators have been unable to find the main body of the trust, prosecutors wrote.
The trust was valued at nearly $360 million at the end of 2004, and it issued about $8 million in grants that year, according to its last report to the Internal Revenue Service. Matheny, in an earlier telephone interview, denied any money had gone to Avery or his businesses. Efforts to reach Matheny and Collins in recent weeks have been unsuccessful.
According to previous news accounts about the trust, Stanley Smith was an orchid collector and Australian war correspondent who made a fortune mining in Malaysia. Smith died in 1982. His widow is May Wong Smith.
The FBI agent, Campe, believes that "Avery and Kane appear to have gone to great lengths to conceal the whereabouts of May Wong Smith," Skrocki wrote. Kane's wife told investigators an "old lady" in the Bahamas was being taken care of by a husband and wife, who are former law enforcement agents, hired by Avery.
Security Aviation and related companies started or bought by Avery had at least 20 separate bank accounts with suspicious wire transfers and online transfers, the government says.
The government also is investigating the circumstances of a loan made last year by Wells Fargo Bank to Security Aviation. The loan officer was Joseph Kocienda, who later went to work for Avery. Kocienda is now financial officer of all the Avery companies, according to a letter filed in court. The Oct. 4 credit report for the loan attributes Security Aviation's growth to a $30 million Department of Defense contract and also refers to over $150 million in new contracts.
In an affidavit in court, Kocienda acknowledged being the source of those statements while he worked for the bank but said he meant to say the company was in negotiations for potential new defense and government contracts.
In a brief telephone interview Tuesday afternoon, Kocienda said he couldn't remember the circumstances of how such a mistake occurred. He said the loan was clearly justified. "To me it was a slam dunk," he said.
But the government says Kocienda's sworn statement is "a model of obfuscation." It makes no sense for an experienced financial officer like Kocienda to make such a blunder, the government says.
"The fact that Kocienda went to work for Security Aviation after his involvement with this particular loan, when the loan was based on false statements, raises more questions than it answers," the prosecution wrote in its filing.
--------------------------------------------------------------------------------
more and more this sounds like a case of some guys going too far pretending they are GI Joe fighting Cobra Commander.
http://www.adn.com/news/alaska/security_aviation/story/7599135p-7509582c.html
FBI suspected raid on trust in Security Aviation growth
AFFIDAVITS: Prosecutors say "mountain of information" led officials to suspect fraud.
By LISA DEMER and RICHARD MAUER
Anchorage Daily News
Published: April 5, 2006
Last Modified: April 5, 2006 at 02:55 AM
Security Aviation Inc. executives lied about winning massive government contracts for war games and covert operations to cover up what authorities suspected was the real source of their money: a raid on a private trust connected to company owner Mark Avery, federal prosecutors assert in new court filings.
Avery and his associate, Rob Kane, led the company in an explosion of growth starting in July 2005, purchasing executive jets, helicopters, Warsaw Pact military planes, vehicles, real estate, boats and businesses in Alaska and Nevada with no apparent worry over costs, financing or payroll. Last fall, Kane said that Security Aviation and another company owned by Avery spent $54 million in 10 days, the government says in one of the new documents.
The latest round of filings in U.S. District Court show that federal authorities had been investigating the pair since at least October.
The new documents, filed this week, are part of the government's efforts to fight off attempts by lawyers for Security Aviation and Kane to suppress evidence seized in searches in February. Security Aviation and Kane are under indictment on charges of illegally possessing and transporting Russian rocket launchers for the '70s-era Czech military jets.
The government's responses are loaded with startling revelations about the government's investigation into Avery's rapid buildup of Security Aviation and related companies. Both sides have lifted snippets out of sworn statements filed by an FBI agent to convince Magistrate Judge John Roberts to issue a series of search warrants between Feb. 1 and Feb. 3. The filings don't give the whole picture, and the affidavits are still under seal. But prosecutors said the affidavits present "a mountain of information" that led them to suspect that fraud was committed against the trust and an Anchorage bank.
The new documents reveal that:
• Kane told a witness he and his Alaska associates "are currently engaged in 'black ops' and that he claimed to be transporting detainees for the U.S. government from overseas." Kane claimed they had Defense Department contracts to serve as opposition forces in training missions and "evacuation contracts with 300 embassies and consulates in the Pacific Rim region."
The Defense Department, the State Department and the Air Force all denied the existence of such contracts, prosecutors wrote.
• Kane boasted, sometimes in outlandish or contradictory terms, about money. He told one former Security Aviation employee on Jan. 26 that "I have more money than God" and another government witness that he was worth $660 million he had inherited from a presidential adviser who had died the previous year. But he also told a government agent that "Avery is the money man."
• Kane insisted on strict computer security measures including e-mail and data encryption and emergency data destruction systems. "Kane and Avery advised two witnesses that they required extraordinary computer and communications security, including CIA grade encryption, to protect a 'trust' and their companies from unspecified outsiders who will scrutinize multimillion-dollar international wire transfers by Avery and Kane," prosecutors wrote.
• Kane was involved in earlier government investigations involving the "illegal possession of automatic weapons, grenade launchers, and hand grenades, among other items including the use of a rocket launcher in Oregon in 2003," prosecutors wrote. They do not specify whether Kane was a target of those investigations. The rocket launchers in the current case are designed to be mounted on planes, but other types can be shoulder-held.
Avery is one of three trustees for the May and Stanley Smith Charitable Trust, which prosecutors say was the suspected source of a $50 million "loan" that fueled "Avery's extensive and multimillion-dollar investment into Security Aviation and a horde of other business ventures, none of which were charitable in nature."
The government is relying heavily on comments purportedly made by Kane and Avery themselves, in particular assertions that their money came from a trust. While those claims led to the original searches, prosecutors have not said whether they have uncovered evidence showing the Smith trust was plundered to cover Avery and Kane's investments.
The search warrant affidavits by FBI special agent Matthew Campe list both specific and general claims of wire transfers of funds into Avery's businesses through Wells Fargo Bank and other means, says one government filing, by assistant U.S. Attorney Steven Skrocki.
"Both men made mention of a 'trust' and Avery in particular made reference to a 'loan,' " the government says. Investigators suspected when they sought the search warrants that "the source of Avery and Kane's incredible expenditures in such a short period of time, at least $50 million, came from a raid on the May and Stanley Smith Charitable Trust either via the trust itself or through some type of shell company," the government says.
Defense lawyers have said that the money fueling Security Aviation and other businesses is legitimate and the government has overreached in its case involving the rocket launchers. The only criminal charges so far revolve around the fact that Kane and the company failed to register the launchers. Defense lawyers say that's essentially a paperwork issue. On Tuesday, a Security Aviation lawyer declined to comment on the newest government filings.
The Smith trustees each are paid $400,000 a year to administer the trust, which was established by Avery's father, Luther Avery, a celebrated tax and estate lawyer in San Francisco. Mark Avery inherited his seat on the trust after his father died in 2001.
The other two trustees, investment adviser John P. Collins Jr. and retired accountant N. Dale Matheny, are both Californians, and the trust has operated out of Matheny's office on Market Street in San Francisco. According to the new government filing, the trust stopped filing records in California after March 2004 because it had moved. Investigators have been unable to find the main body of the trust, prosecutors wrote.
The trust was valued at nearly $360 million at the end of 2004, and it issued about $8 million in grants that year, according to its last report to the Internal Revenue Service. Matheny, in an earlier telephone interview, denied any money had gone to Avery or his businesses. Efforts to reach Matheny and Collins in recent weeks have been unsuccessful.
According to previous news accounts about the trust, Stanley Smith was an orchid collector and Australian war correspondent who made a fortune mining in Malaysia. Smith died in 1982. His widow is May Wong Smith.
The FBI agent, Campe, believes that "Avery and Kane appear to have gone to great lengths to conceal the whereabouts of May Wong Smith," Skrocki wrote. Kane's wife told investigators an "old lady" in the Bahamas was being taken care of by a husband and wife, who are former law enforcement agents, hired by Avery.
Security Aviation and related companies started or bought by Avery had at least 20 separate bank accounts with suspicious wire transfers and online transfers, the government says.
The government also is investigating the circumstances of a loan made last year by Wells Fargo Bank to Security Aviation. The loan officer was Joseph Kocienda, who later went to work for Avery. Kocienda is now financial officer of all the Avery companies, according to a letter filed in court. The Oct. 4 credit report for the loan attributes Security Aviation's growth to a $30 million Department of Defense contract and also refers to over $150 million in new contracts.
In an affidavit in court, Kocienda acknowledged being the source of those statements while he worked for the bank but said he meant to say the company was in negotiations for potential new defense and government contracts.
In a brief telephone interview Tuesday afternoon, Kocienda said he couldn't remember the circumstances of how such a mistake occurred. He said the loan was clearly justified. "To me it was a slam dunk," he said.
But the government says Kocienda's sworn statement is "a model of obfuscation." It makes no sense for an experienced financial officer like Kocienda to make such a blunder, the government says.
"The fact that Kocienda went to work for Security Aviation after his involvement with this particular loan, when the loan was based on false statements, raises more questions than it answers," the prosecution wrote in its filing.
--------------------------------------------------------------------------------
more and more this sounds like a case of some guys going too far pretending they are GI Joe fighting Cobra Commander.
That would be cool.
