A federal judge questioned the foundation of the government's case Tuesday against Miami criminal defense attorney Ben Kuehne.
Kuehne is charged with money laundering and wire fraud after he vetted $5.2 million in legal fees paid by Colombian drug kingpin Fabio Ochoa to retain prominent Miami criminal defense attorney Roy Black. Kuehne wrote a report concluding the fees were legitimate funds and not cocaine profits from Ochoa's role as a leader of the infamous Medellin cartel.
U.S. District Judge Marcia Cooke in Miami told prosecutors that an exception in federal money laundering statutes appears to allow lawyers to be paid legal fees without fear of prosecution as the defense argued.
Senior Assistant U.S. Attorney Robert Feitel of Washington said attorneys who launder money are complicit and the exception is an affirmative defense that a jury should decide. He also said the charges do not interfere with the constitutional right to counsel of choice because Kuehne was not representing Ochoa.
"I don't see there's a Sixth Amendment right to use criminal proceeds," he said.
Cooke appeared incredulous.
"If I follow your analysis, we might as well do away with private defense counsel," she said.
Kuehne's motions say the Justice Department has been hostile to a laundering law exemption passed in 1988 that protects attorneys from criminal liability in accepting defense fees.
Addressing both sides at one point, Cooke said, "You are taking the statute to the extreme." She said the government was stretching case law.
Feitel said the unique facts of the case call out for prosecution.
"Most don't leave a trail so clean, so convincing it leaves no doubt of the criminal liability," he said.
Washington attorney John Nields of the Howrey law firm said the government would make the exception meaningless. If the case against Kuehe is allowed to go forward, no lawyer would ever sign on to vet legal fees, Nields said.
"This case is a prime example as to why Congress wanted the exception," he said.
Nields, who along with Miami attorney Jane Moscowitz of Moscowitz & Moscowitz is representing Kuehne, didn't expect Cooke to rule immediately on a batch of pretrial motions.
Kuehne was charged along with Colombian attorney Oscar Saldarriaga and accountant Gloria Florez Velez, who were hired to help Kuehne make sure the money heading to Ochoa's Miami attorneys was untainted by drug profits.
The federal criminal defense bar has said Kuehne's prosecution is an attempt to chill the legal representation of high-profile clients.
Kuhene would be a big catch for the Justice Department. He represented Vice President Al Gore in the 2000 presidential election challenge and other high-profile clients, many on a pro bono basis. Kuehne was paid about $200,000 for his work on the Ochoa case.
An indictment unsealed in February alleges Kuehne and his co-defendants knew the Ochoa funds were at least co-mingled with drug trafficking money. Because no Colombian bank would convert Ochoa family money into dollars, Kuehne turned to what prosecutors called the black market peso exchange. The money sent to Black was exchanged for dollars by a prosecution witness, Hernando Saravia, who is named in a separate indictment for money laundering in New York. He contributed $1.8 million in government money obtained in U.S. drug stings to Kuehne.
Saravia started working for the government in 2002 after he was caught trying to move $400,000 in drug profits from New York to Colombia, according to court documents.
Prosecutors in August appeared to backtrack when they said they plan to offer no trial evidence linking Kuehne directly to drug profits. Instead, testimony would show Ochoa family cattle and horse concerns used for defense fees were tainted by Ochoa's $300 million drug operation.
Kuehne maintained the livestock operation started by Ochoa's father was financially separate from Medellin cartel activities. Ochoa was convicted in 2003 and is serving a 30-year prison sentence.
