Defense attorneys have gone to the 10th Circuit Court of Appeals in Denver in their bid to gain the pretrial release of a suspect in the Washakie Renewable Energy federal fraud case.
U.S. District Judge Jill Parrish in Salt Lake City has refused to grant bail for Lev Aslan Dermen, 52, a California businessman held in the Davis County Jail.
In court papers filed Thursday in Denver, Dermen attorney Mark Geragos criticized the “depraved” practice of holding criminal suspects without bail for several months while prosecutors work on promised additional charges.
Dermen and Washakie owners Jacob and Isaiah Kingston were indicted Aug. 1, 2018, on charges related to the alleged fraud of $511 million — and the allegedly planned extension of the scheme to $1.1 billion — in biofuels tax credits.
Geragos argues Dermen is ready for trial on four “straightforward” money laundering charges but that he is being unfairly tied to the much more involved case against Jacob Kingston.
Major delays in the Kingston prosecution and defense may mean that Dermen will be held in jail for up to a year before his charges are adjudicated. Geragos describes that scenario as a violation of Dermen’s constitutional rights under the Speedy Trial Act.
The petition to the Denver court is for a writ of mandamus to overturn Parrish’s rulings, which Geragos said damage Dermen’s rights “in a way not correctable on appeal.”
In earlier court filings, U.S. prosecutors said they continued to work on a superseding indictment that would include more charges and name three or four more defendants. Prosecutors argued the impending charges were another reason to keep the defendants behind bars pending trial.
“The court cannot allow this depraved practice to continue,” Geragos wrote. “Nothing in the Constitution or the laws of this nation allow the government to detain a defendant on the ground that it may be bringing criminal charges sometime in the future.”
Prosecutors have contended Dermen and the Kingstons should be denied bail because they are major risks to flee.
In a Dec. 18 hearing, Parrish said, “I’m really concerned that we just keep kicking the can down the road without definitively resolving what I think are some very serious issues” about the Speedy Trial act and pretrial detention.
But three days later, she granted a continuance of the trial to May, a time that all attorneys agreed would slip even further because of the voluminous case against Jacob Kingston. In her ruling, Parrish noted 850,000 items of evidence already have been submitted in the case.
Dermen is charged with three money laundering counts for allegedly helping Kingston to launder $350,000 Kingston is alleged to have obtained through the tax fraud. A fourth money laundering count says Dermen helped Kingston and his brother, Washakie CFO Isaiah Kingston, buy a $3 million home in Sandy with loot from the tax scheme.
In filings Jan. 15, Geragos asked Parrish to sever Dermen’s case from the Kingstons’ and grant a change of venue to California.