Lawyer admits laundering drug money
A longtime San Diego criminal defense attorney admitted Tuesday that he laundered $100,000 in drug proceeds for the owner of a marijuana dispensary and tried to tamper with a potential witness in the case.
It’s not the first time James J. Warner has been under federal scrutiny in his 40 years of practice, but it appears to be the first time the charges will stick.
The 65-year-old lawyer agreed to forfeit more than $300,000 as part of the plea agreement, including $165,000 found vacuum-sealed in a suitcase at his Bankers Hill law office.
According to the plea, Warner agreed to launder $100,000 in cash that federal investigators had missed during a search of his client’s home in May 2012. He had the cash delivered to him in a paper bag at his law office. He then deposited $99,900 of his own funds into a bank account in the British Virgin Islands.
Warner told the client, identified in court documents as T.K., that he knew of an investment opportunity, at a Haitian gaming company tied to an ambassador there, in which the money could gain interest, according to a search warrant affidavit prepared by a U.S. Internal Revenue Service agent.
Warner then began replenishing his U.S. bank accounts with the illegal cash, in amounts under $10,000, to sidestep the bank’s requirement to report transactions over that amount, the plea agreement states.
To issue the interest payments to his client, Warner created a shell corporation, Grenadine Development Inc., and opened a bank account from which to write checks.
Everything was going smoothly until federal authorities learned T.K. had reopened his marijuana dispensary in San Diego. They raided him again in March 2013.
The dispensary owner, hoping for leniency, decided to spill about the money laundering.
Wearing a recording device, he met with Warner and discussed the hidden $100,000, the IRS affidavit says.
It was about that time that Warner began representing another man identified as M.E., a suspected business associate of the dispensary owner, who the government was trying to turn as a snitch in the case against him. Rather than declare a conflict of representation in the case, Warner continued to represent both defendants.
On the wire, Warner was recorded urging the dispensary owner to pay M.E.’s legal fees, and Warner would attempt to keep M.E. quiet, according to the plea agreement.
Warner argued that if the M.E. got a court-appointed lawyer, “they’ll just squeeze him to roll” on the dispensary owner, he said, according to the search warrant. “I have to take care of the case and try to help you and help him.”
The charges against M.E. were dismissed when the attorney’s conduct came to light.
Warner has been under investigation several other times in his career. In 1985, he was acquitted in a nonjury trial of conspiracy and jury tampering charges in a drug smuggling investigation. The prosecutors accused Warner of encouraging a witness to lie, but Warner’s lawyer said the advice was proper and legal, and numerous defense lawyer groups watching the case across the country agreed.
In acquitting Warner, the judge said the conduct was nonetheless “absolutely unethical.”
In 2002, Warner stepped down from representing a woman in a Tijuana kidnap and murder-for-hire case when he was informed that he was under investigation in a separate but related case. No further information about the matter was released.
He was also investigated in 2010 on suspicion of brokering the sale of a different marijuana dispensary on behalf of one of his clients, the search warrant states.
As a result of Warner’s plea deal, he has agreed to resign from the California Bar, and he could be disbarred.
“This is a sad and tragic day for Jim Warner who has been a terrific lawyer in this community, a loving husband and father, and is a fine person,” his high-profile attorneys, Charles Sevilla and Michael Pancer, said in a statement Tuesday.
Warner faces a maximum of 23 years in prison when sentenced before U.S. District Judge Jeffrey Miller on Oct. 16, although both defense lawyers and prosecutors have recommended he serve three years probation, including a year of home detention, and perform 2,000 hours of community service.
“This is obviously very troubling behavior by a defense attorney, and he crossed the line,” Assistant U.S. Attorney Sherri Walker Hobson said. “This conduct by a criminal defense attorney is an anomaly and should not reflect negatively on the good work done by professional and ethical defense attorneys, because defense attorneys play a very important and vital role in the criminal justice system.”
While the case was prosecuted by Walker Hobson, who is based in San Diego, it was supervised by the U.S. Attorney’s Office in Los Angeles after the local office was recused.
