Prosecutors Seek Joint Trial for La. Lawmaker Linked to Insurance Scam

July 2, 2008

A Louisiana state senator should be tried alongside the woman he allegedly helped launder money to hide her illegal operation of an insurance business, prosecutors argue in court papers filed June 30,

State Sen. Derrick Shepherd, D-Marrero, had asked a federal judge to order separate trials for him and his alleged coconspirator, Gwendolyn Joseph Moyo. The lawmaker’s attorneys say Moyo made statements to investigators that might be improperly used against Shepherd during a joint trial.

Prosecutors, however, argue Shepherd’s request should be denied because he played an “integral part” in the alleged money laundering conspiracy.

“Shepherd’s criminal acts and their results cannot be understood in isolation,” Assistant U.S. Attorney Michael Magner wrote. “Shepherd’s acts can only be understood fully when put in perspective by the vast scheme which he was a part of.”

U.S. District Judge Carl Barbier is scheduled to hear arguments from both sides of the case on July 10.

John Wilson Reed, one of Shepherd’s lawyers, declined to comment on prosecutors’ court filings.

Shepherd has asked Barbier to suppress statements the senator made to two FBI agents in August 2007, before he was indicted on charges that include conspiracy to commit money laundering.

Prosecutors opposed that request, saying Shepherd’s statements were “freely and voluntarily given in a non-custodial setting.”

An FBI summary of the August 2007 interview shows the agents asked Shepherd several questions about his failed 2006 campaign to unseat U.S. Rep. William Jefferson, D-La. Shepherd finished third in the primary, behind Jefferson and another Democrat, Karen Carter.

Shepherd told the agents he was approached by supporters of both Carter and Jefferson who offered to help him pay off his campaign debt, which exceeded $200,000, if he would support their candidate.

Shepherd said he “dismissed all these offers because he did not trust them, nor did he believe in people like that,” according to the FBI report. “Shepherd said these types of offers are made in the normal course of campaigns.”

Shepherd also denied any connection between his congressional campaign and his association with Moyo, whom he recalled seeing at a Jefferson campaign party and at a music festival with Jefferson’s wife.

Messages left at Carter and Jefferson’s offices weren’t immediately returned.

Moyo, 53, allegedly laundered roughly $2 million to conceal her operation of an insurance business without a license. She has federal convictions dating back to 1989 that barred her from running an insurance business, prosecutors said.

Shepherd, 38, a lawyer, allegedly deposited construction bond premiums in his bank accounts for Moyo after her accounts were seized by state regulators, prosecutors said.

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