Judge won’t consolidate HOA case plea deals

Senior U.S. District Judge Lloyd George has decided against consolidating a barrage of criminal cases being filed in the massive investigation at Las Vegas Valley homeowners associations.

In the interest of judicial economy, Justice Department lawyers from Washington, D.C., wanted one judge to handle all of some two dozen plea deals they intend to file over the next several weeks in what may be the most far-reaching criminal fraud case ever in Nevada.

The defendants in those cases have struck agreements to testify in a push by prosecutors to indict higher-level players who include businessmen, lawyers, judges and former police officers.

George hinted in court last week that he might accept the cases, but he said otherwise in a two-page order late Thursday.

“After taking the initial plea of the defendant in the present matter, the court has consulted with the district judges assigned to the related cases filed in this district that arise out of the investigation of fraud,” George wrote. “Pursuant to that consultation, the court has determined that at this time it is not prudent to consolidate the related cases.”

Only two cases have been made public, but several more are said to have been filed under seal.

Last week, longtime Republican strategist Steve Wark was the first to plead guilty in the investigation, which has been running for more than three years. He entered a guilty plea to one count of conspiracy to commit wire and mail fraud. A second Las Vegas man, Darryl Scott Nichols, pleaded guilty to the same charge.

Both Wark, 54, and Nichols, 47, admitted participating in a conspiracy to stack homeowners association boards with members who then pushed for construction defect lawsuits against builders.

Legal work and multimillion-dollar repair contracts, authorities said, were funneled to lawyers and companies associated with the scheme at the expense of the homeowners, who were deprived of honest voting on their boards.

The board members friendly to the co-conspirators were “straw purchasers” in the developments and were elected by the co-conspirators through classic dirty campaigning that included conducting phony polling, hiring private investigators to dig up dirt on candidates and rigging the balloting, according to federal court documents unsealed last week.

“This process created the appearance of legitimacy, since bona fide homeowners believed the elected board members … were, as fiduciaries, acting in their best interest rather than to advance the financial interests of the co-conspirators,” the documents alleged.

Nearly a dozen homeowners associations have become embroiled in the investigation.

Contact Jeff German at jgerman@reviewjournal.com or 702-380-8135.