As he continued to negotiate how much he will tell a grand jury probing his finances, Joe Waldholtz again said little at a court appearance Wednesday - but he managed to remain free, and unencumbered by criminal charges, for another three weeks.
After the hearing, he uttered his first words to reporters besides "no comment": "I'd just like to say that I love my wife and daughter very, very much. And I hope they're doing well, and I wish our families, including us, a good holiday."Just after the court appearance, Rep. Enid Waldholtz's attorney Charles Roistacher issued a press release through her office. He said that a number of documents found in the couple's Washington, D.C., and Salt Lake homes show Joe Waldholtz had filed false documents with a Salt Lake bank on the couple's Salt Lake home and other matters. A list of the documents appears at the conclusion of this report.
"There is no question in my mind that federal authorities should be charging (Joe) for criminal activities," said Roistacher. "To say we were stunned by what we found and later obtained would be an understatement. It's clear that Joe used these documents to establish and maintain the myth that he was independently wealthy. He used them to perpetrate fraud and deception on a long line of people." Joe not only fooled Enid, says Roistacher, but also other people and respected banking firms.
Joe Waldholtz's attorney couldn't be immediately reached for comment.
Enid Waldholtz, R-Utah, filed for divorce last week after Joe disappeared for six days amid allegations he embezzled millions of dollars from her family and Joe's grandmother, filed false federal reports as Enid's campaign treasurer and kited checks on their joint accounts.
Also on Wednesday, Enid's lawyer revealed why her father, Forrest Greene, provided huge loans to Joe: In part, it was intended to help him pay off bad debts. The money has disappeared. Lawyers say it was not intended for Enid's campaign, where she reported spending $1.8 million of her own money.
Roistacher said Wednesday: "Joe made representations that his family money, the Waldholtz Family Trust, the (TWC) Ready Assets accounts were not available, were frozen in litigation and he didn't have access to his family wealth. Those representations were continually made by him and believed by the victims."
Roistacher has previously confirmed that Forrest Greene loaned more than $1 million to Joe andEnid over the past two years. Justice Department officials peg the loan total at about $4 million.
In any case, "The money was loaned (by Forrest Greene) so that Mr. Waldholtz could resolve and reconcile financial issues that he had and that he couldn't resolve with his own money because his own money was frozen and otherwise not usable," Roistacher said Wednesday.
The implication is that some of the loan, at least, went to pay off Joe's bad debts.
Roistacher reiterated that Enid Waldholtz and Forrest Greene never realized that any of the loan money was going into her 1994 campaign. However, Justice Department officials have told the Deseret News that it appears Forrest Greene was making a series of loans to Enid and Joe at the same time that the couple was putting $1.8 million into Enid's 1994 campaign - in the summer and early fall of that year.
Joe Waldholtz again appeared before U.S. District Court Judge Emmet G. Sullivan to determine whether he would be ordered to appear immediately before the grand jury investigating his finances.
Deputy U.S. Attorney William E. Lawler III asked for a delay on any action until Dec. 15 - three weeks away - saying he and Joe's Philadelphia lawyer Harvey Sernovitz are still negotiating about what areas Waldholtz might discuss with the grand jury rather than invoking his Fifth Amendment right to remain silent to avoid incriminating himself.
Lawler later confirmed the investigation has widened beyond possible check kiting, saying his office has talked to lawyers of Forrest Greene and expects to talk to witnesses in Pittsburgh, where Joe missed a court date last week to turn over at least $700,000 in assets of his grandmother's that his family fears he embezzled.
Until the next Dec. 15 hearing, Sullivan ordered Waldholtz - who has still not had any criminal charges filed against him, only a warrant compelling appearance before the grand jury - to remain in the third-party custody of a lawyer-friend in Philadelphia, Jeffery A. Liebmann.
Sullivan also limited Waldholtz's travel to Washington, Philadelphia and Pittsburgh, ordered him to report by phone each day to the FBI and has had his passport canceled - although Joe says he cannot find the actual document to turn over to the court.
Justice Department sources said the delay until Dec. 15 gives prosecutors time not only to discuss possible cooperation by Joe Wald-holtz, but also time to build a case against him. If and when Joe Waldholtz is charged criminally, a indictment must be filed against him within 30 days.
Lawler would not comment in a press conference on whether his office and Joe's lawyers are discussing any arrangement for immunity for testimony or any other plea bargaining.
While prosecutors negotiate about how cooperative Joe Wald-holtz may be, Lawler said Wednesday that Enid Waldholtz "has been cooperative and she has, through counsel, voluntarily provided documents to the U.S. Attorney's Office."
He said that a story Monday in the Washington Times saying officials "seized" records from her home were false.
Lawler said the grand jury originally began with a probe into possible check kiting in joint accounts held by Enid and Joe Waldholtz.
An FBI affidavit filed earlier with the court said Joe wrote checks to himself from a Congressional Credit Union account for $227,500 more than was ever deposited there.
Those checks - totaling $1,745,000 - were all deposited in Joe's First Security Bank account in Salt Lake City, in what the FBI said may be a possible check kiting scheme where Waldholtz convinced the institutions to honor deposits immediately (not waiting for checks to clear), artificially inflating deposit balances at both banks and allowing temporary use of bank money not his own.
Besides the checks to himself, the FBI said Joe Waldholtz wrote $65,000 worth of checks to other third parties on that Congressional Credit Union account, many of which were returned as unpaid.
Justice Department officials have also told the Deseret News that Enid's lawyers had told them that Forrest Greene provided $4 million through a swap of assets, which helped provide the liquid cash she used to give $1.8 million to her own campaign. They said she reported the other $2 million or so had vanished.
But Enid's lawyers later told the press the money came in a series of "loans" that were not used for the campaign. Federal law bans individuals from giving candidates loans used for campaign purposes of more than $1,000 per election (the same as the donation limit).
Federal law also requires disclosure of all loans for campaign purposes. Enid's reports did not list any outside loans. If loan money from Forrest Greene was co-ming-led with the couples' other funds, it would likely be difficult to prove that none of it went to Enid's campaign.
The Deseret News has been told federal officials are looking into other possible false disclosures about campaign finances by Joe. For example, the campaign often bounced checks while reporting to the Federal Election Commission that it had hundred of thousands of dollars in cash.
Also, some people listed as donors - including Joe's father and stepmother - now say they never gave any money to the campaign. Other donors cannot be located, or have addresses listed that don't exist.
joe's family has alleged in court in Pittsburgh that Joe may have embezzled $700,000 or more from his grandmother, Rebecca Levenson, who suffers from Alzheimer's disease and had given money to Joe to invest for her.
The family says Joe has refused to account for the money. He missed an order to appear in a Pittsburgh court on Nov. 13 - during the time he had vanished - to turn over all the assets he held for his grandmother.
Recent disclosures also have shown Joe pressured an aide to Enid, Aaron Edens, to add Joe as a cardholder on his personal American Express account. Joe then charged $45,000 in bills, which he was slow to repay. Edens lost his card and his credit was damaged.
Joe was reportedly fired by Pennsylvania National Republican Committeewoman Elsie Hillman in 1992 after a dispute over whether he misused $100,000 on expensive hotel suites, meals and other personal use.
Allegations have surfaced he also often refused to pay credit card purchases - claiming someone had stolen his card. He even refused to pay for his honeymoon suite - saying the roof leaked - and was twice faced with eviction from a posh Georgetown town home for late rent payments, which he said he also withheld because of roof leaks and non-flushing toilets.
Joe and Enid Waldholtz were often sued for nonpayment of bills, but Enid had blamed them in the press on misunderstandings, lost checks, changed addresses and the use of stolen checks or credit card by thieves.
Enid Waldholtz has said she did not know about Joe's deceptions until shortly before he disappeared, after which she filed for divorce.
However, former campaign officials have said they warned her in June 1994 about 30 to 40 possible FEC violations by Joe and retreated when she failed to take action to correct it. Soon thereafter, state party leaders urged her to replace Joe as campaign treasurer and to clean up her campaign's financial problems.
Roistacher said the following Joe Waldholtz papers were found in a bank and in the couple's Salt Lake and Washington, D.C., homes:
-A mortgage application to First Security Bank for their Salt Lake home. The application, dated March 30, 1993, was made prior to their marriage. (The home is listed on county records only in Enid's name). Listed as income on the application by Joe Waldholtz was $27,568 a month, although he apparently wasn't working at the time.
-Copies of Joe Waldholtz's 1991 and 1992 signed income tax returns that were attached to the loan application obtained from First Security. The 1992 return listed $338,360 in rental and trust income, with $263,500 attributed to the J. M. Waldholtz Trust. The 1991 return listed $305,000 in rental and trust income of which $248,972 reportedly came from the trust. (Officials can find no such trust and Joe's father says he knows of no such trust).
-Copies of fraudulent, Gennie Mae-backed securities certificates supposedly issued through the Hillman Co. to Joe's grandmother's trust. (Joe worked as Elsie Hillman's top political aide but left in 1992 after reportedly charging upwards of $100,000 to her firm without permission. Hillman is the longtime GOP national chairwoman of Pennsylvania and one of the richest women in America).
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ADDITIONAL INFORMATION
Divorce file sealed
Third District Judge William Thorne on Tuesday sealed the Waldholtz divorce file at the request of one of Rep. Enid Waldholtz's lawyers.
Last week, while her husband Joe Waldholtz was still missing, Enid Waldholtz filed for divorce and fired him as her campaign treasurer and as an unpaid aide in her office.
At the time of the filing, Enid said Joe had abandoned their 2 1/2-month-old daughter and she wanted him arrested and punished.
The Deseret News plans to challenge the sealing of the court records.