Crime

Retrial of Cay Clubs' Clark appears to be winding down

The second bank-fraud trial of Cay Clubs Resorts and Marinas founder "Dave" Clark entered its ninth day Monday at Miami's federal courthouse.

Defense attorneys for Fred D. "Dave" Clark Jr., 57, planned to call Ricky Lynn Stokes, a former top salesman for Cay Clubs, to testify.

Stokes, 55, is serving a five-year federal sentence for conspiracy to commit bank fraud. He pleaded guilty last December in connection with the Cay Clubs collapse that prosecutors estimate cost investors and lending institutions about $300 million and that they've termed a Ponzi scheme.

A federal jury could not reach a verdict on Clark in August after a five-week trial in Miami, so it went to re-trial on seven charges of bank fraud and mail fraud and one of lying to the Securities and Exchange Commission.

Cristal Coleman Clark, his wife and a former Cay Clubs manager, was acquitted of criminal charges at the same trial over the failed condo-hotel corporation.

The second trial for Dave Clark, Cay Clubs' founder, appears to be moving more swiftly. Prosecutors with the U.S. Attorney's Office in Miami submitted their proposed jury instructions to U.S. District Court Judge Jose E. Martinez last Thursday.

Among standard instructions in the 32-page prosecution filing, assistant U.S. attorneys asked the judge to instruct jurors not to consider "lender negligence" as a defense for any of the seven fraud-related counts against Clark. 

Any "evidence or argument that a financial institution or its employees could have done something ... to prevent an alleged fraud, or evidence that the lender's procedures were somehow deficient, should not be considered by you as an excuse or defense to the charges of conspiracy and bank fraud," prosecutors asked Martinez to tell jurors.

Cay Clubs executives improperly included "leaseback" payments to unit buyers in the mortgage cost and used undisclosed insider sales of units to depict an inflated value of the units, according to the prosecution.

Defense attorneys contend the Cay Clubs collapse ranks among many real-estate failures caused by an economic recession, and not the result of criminal acts.

Cay Clubs, founded in 2004 and based in the Upper Keys, told unit buyers it would convert existing resorts in the Keys, Clearwater and Las Vegas into luxurious and profitable condo-hotels. By 2008, the firm crashed under pressure to meet financial commitments to unit buyers and inability to perform promised renovations.

After the company's collapse, the Clarks moved to Central America. U.S. marshals arrested them there in summer 2014.

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