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Beach Grit

Update: Conan Hayes’ Fraud Charges!

Rory Parker

by Rory Parker

Legal technicality means RVCA founder may walk away from his alleged short sale fraud…

You probably haven’t been following the ongoing scandals involving the Orange County prosecutor’s office, and that’s a shame. Plenty of dirt is hitting the air, exposing a tradition of corruption within the government wing charged with protecting the property rights of a bunch of rich assholes in a SoCal coastal shitburg.

First there was the jailhouse informant scandal, wherein the District Attorney’s office gave preferential treatment to snitches in exchange for perjury, and the Sheriff engaged in a decades long practice of concealing exculpatory evidence from defendants.

Then a DA’s office employee was allowed to viciously beat a defense attorney inside the actual courthouse.

Now it’s come around, overlapped with our surf world, and may lead to Conan Hayes walking away from his alleged short sale fraud scot-free.

Or, one would hope, given the implications of a successful conviction at the hands of a prosecution that has repeatedly demonstrated its willingness to commit criminal acts.

The OC Weekly has been doing a superb job covering the constant stream of prosecutorial misconduct, and their latest installment, covering Hayes’s ongoing trial, sheds light on a lot of very interesting information. 

A quick recap of the action so far:

In 2010 Hayes took advantage of a “hardship based program” offered by Bank of America, qualifying by pleading poverty and unemployment. The bank approved a short sale, wherein a homeowner avoids foreclosure by selling for below value and the bank accepts that amount as payment in full.

However, the bank then learned of the sale of RVCA, and the $7.5 million Hayes earned from it. Which earned Conan a felony arrest warrant, and a potential five years in prison.

Now that you’re up to date, let’s get to the juicy new bits.

In her headlong rush to win a conviction prosecutor Megan Wagner illegally obtained Hayes’s IRS records, a federal crime carrying up to five years in prison. A poorly considered move from an unscrupulous attorney more concerned with conviction rates than justice, made worse by the fact that she could have, and now has, obtained the records through legal means.

The DA’s office argued that her malfeasance was irrelevant, as, according to Matt Lockhart, Wagner’s fellow deputy DA, “It’s been obtained properly now.”

“This case can proceed to trial without infringing on the defendant’s right to a fair trial. We don’t have to give a windfall to a defendant just because the prosecution has done something wrong. . . . We’re not here to punish the prosecution for whatever foibles we may or may not possess.”

You’d think that the prosecutor’s office criminal acts in pursuit of convictions would be taken seriously, ideally leading to a dismissal of charges, but the presiding judge disagrees. It’s the OC, no real surprise there.

What is surprising is the Prosecution’s attempt to limit contact between the defense and Paul Tenore Sr, a witness for the defense.

Paul Tenore Sr is an Orange Country realtor, and father to Tenore Jr, Hayes’s former partner at RVCA. Tenore Sr facilitated the original short sale.

Despite the fact that the prosecution will not be calling Tenore Sr as a witness, Wagner sought to restrict contact between him and the defense.

In a disgustingly ironic argument Wagner asserted, “DAs have an obligation to protect the process. There is good cause to believe there’s been a defense effort to have Mr. Tenore change his story.”

Furthermore, the prosecution disappeared 35 pages from their surrendered discovery, the evidence they’ll be presenting against Hayes, which they are legally obligated to provide to the defense. Despite media portrayals to the contrary, surprise evidence is not allowed in court, meaning the pages most likely went missing because they are damaging to the County’s case.

Or, you know, it could have been a mistake. But it’s hard to believe a cheating liar.