ATTORNEY CHARGED WITH MONEY LAUNDERING

Orange County: The Defense Lawyer For Years Was Contracted To Represent
Indigents Accused Of Crimes.

One of Orange County's most controversial defense attorneys was arrested
Tuesday along with his wife on suspicion of laundering $175,000 in drug
profits. The arrests followed an FBI sting operation.

William Stewart of Newport Beach appeared in federal court Tuesday
afternoon, shackled to a waist chain alongside his wife, Amalia, and a
business colleague also arrested in connection with the alleged laundering.

Stewart, who for years controlled the county's million-dollar contract to
represent indigents accused of crimes, told the judge he could not afford
his own attorney and asked that the court appoint one for him. As
Magistrate Mark L. Goldman reviewed Stewart's file, he said: "You have a
substantial income for a court-appointed attorney. It appears that you
don't have any liquid assets."

Clad in a Ralph Lauren T-shirt and jeans, Stewart replied: "That's in
essence the problem."

Goldman granted the request to have the U.S. government pay for a federal
public defender to represent Stewart. But the judge warned Stewart that he
may be required to repay at least a portion of his legal expenses later in
the case.

Stewart, 55, held the lucrative county contract for indigent services for
15 years, despite drawing fire from Orange County judges over the way he
handled his responsibilities.

Critics faulted the way he "sublet" cases to other attorneys while running
a private import-export business out of Colombia, sometimes communicating
with county officials by fax and phone.

Stewart also came under scrutiny when it was revealed that he regularly
paid for limousine rides to parties and other events for judges and
prominent county officials.

But after Orange County's 1994 bankruptcy, Stewart eventually lost his
county contract as officials scrambled to cut costs where they could.

In recent years, the once-wealthy Stewart fell on hard times, federal
prosecutors said. Two years ago, he was targeted by federal and state tax
collectors, who together socked him with more than $1 million in tax liens.

Federal prosecutors allege that Stewart may have turned to money laundering
as a quick way to turn his financial problems around.

"He was used to a certain lifestyle," said Assistant U.S. Atty. Carmen R.
Luege after Tuesday's court hearing. "I'm not sure if he was able to keep
that up after the end of the contract."

The investigation took more than two years and was a spinoff from an
earlier case against an uncle of Stewart's wife.

Authorities tape-recorded conversations two years ago between Amalia
Stewart and her uncle, Maximiliano Ramirez, while Ramirez sat in custody in
Los Angeles on money-laundering charges. The pair spoke in code, and
authorities launched a probe of Amalia Stewart, believing that she was
trying to launder "several million dollars" through a Laguna Beach jewelry
business that William Stewart owned, court records allege.

It was during that investigation that Amalia Stewart, 35, allegedly told an
undercover agent that she used her husband's legal practice to launder
money for drug dealers, according to documents.

The undercover agent asked the couple for help in laundering $50,000 and
then another $125,000, with the promise of more work in the future if the
two transactions were successful, Luege said. As part of the deal, the
Stewarts were allowed to keep $24,000, Luege said.

The Stewarts funneled the money through accounts held by the William W.
Stewart & Associates legal practice, according to court documents.
Prosecutors allege they were helped by Bart Siggson of Yorba Linda.
Siggson, who owns an Anaheim tanning salon, was charged Thursday on lesser
charges stemming from the laundering scheme.

A federal grand jury last week indicted the Stewarts on nine counts of
money laundering, carrying a maximum sentence of 235 years in prison and
fines up to $5 million. On Tuesday, the couple was ordered to remain in
custody until a bail hearing on Thursday.