ATLANTA — With the federal criminal trial against suspended Chairman Marcello Banes and suspended District 3 Commissioner Stephanie Lindsey expected to begin in less than a month, Banes is looking to have two of those charges dropped.
On Monday, Banes’ attorney Lynsey Barron filed a motion to dismiss two counts of fraud pertaining to applications Banes made with the Small Business Administration (SBA). The U.S. Attorney’s Office issued a superseding indictment on Jan. 6 — just weeks before the trial was supposed to begin — that brought forth allegations that Banes defrauded the SBA on multiple occasions.
According to prosecutors, Banes filed an Economic Injury Disaster Loan (EIDL) for LatReb Logistics LLC on Aug. 17, 2020. Prosecutors claim that Banes misrepresented revenues and listed himself as a sole owner of LatReb, despite Lindsey reportedly owning 49% of the company.
Banes reportedly received an EIDL payout of $49,900 – $50,000 minus a $100 fee.
A similar EIDL was filed two weeks later on Aug. 31, 2020, but was denied.
Barron claims that the superseding indictment on these two counts falls outside of a five-year statute of limitations.
“Each execution through wire can be (and almost always is) charged as a separate count, so while the scheme may be continuing, the individual crimes— the wires—are not,” Barron wrote. “The crime is complete when the wire is transmitted.
“Because Counts 9 and 10 allege instances of wire fraud that fall outside the statute of limitations, they must be dismissed.”
Additionally, both Banes and Lindsey’s legal teams filed motions to exclude certain pieces of evidence for consideration.
Barron is seeking to exclude any evidence of EIDL loans outside of what was mentioned in the superseding indictment or those that were submitted by another party.
Lindsey’s attorney, Brian Mendelsohn, is looking to limit what they call “irrelevant and unfairly prejudicial evidence.”
Banes, in his capacity as a member of the Joint Development Authority (JDA), and Lindsey – who acted in her capacity as a realtor of CSL Realty Group, coordinated a brokerage deal with an industry prospect in Stanton Springs who wished to purchase 40 acres of land.
The company, believed to be Prism Investments — but named “Company A” in court filings —- reportedly paid Lindsey $150,000 in commission following the sale, of which $100,000 was then put into a mutual business entity called “LatReb Logistics LLC.”
Mendelsohn is looking to exclude any evidence or arguments related to how Lindsey or CSL Realty “had a duty to disclose how they would spend commission funds earned from the brokerage agreement.”
It was also argued in the initial indictment that Prism would not have gone through with the transaction had they known Banes, a sitting member of the JDA, was going to receive any of the commission.
However, Mendelsohn looks to block any testimony from Ed Merchant, who works for Prism Investments.
In a separate motion, the U.S. attorney’s office is looking to exclude testimony from a “newly discovered expert” submitted by the defendants. But the attorney’s office said that it had not received a copy of the records for review.
“Until it does so, the Government cannot properly determine whether the expert’s testimony would be properly admitted,” the attorney’s office wrote.
As of this writing, the trial is still expected to begin on May 20 at the Richard B. Russell Federal Building and United States Courthouse in Atlanta.
