1991 DRUG CASE MIGHT TAKE LICENSE FROM LAWYER

Nick Albrecht never faced trial and denies he helped launder drug money,
but now the state bar is reviewing the matter

On a spring day seven years ago, regional narcotics officers went to a
motel in Portland on a "reverse" sting -- instead of posing as buyers they
posed as cocaine sellers.

The ruse worked: They arrested a small-time dealer who eventually spilled
the details of a complex money-laundering scheme. He described how, for
almost a decade, drug profits were laundered through business and real
estate deals.

And he said that two Portland lawyers helped hide the money.

One of the lawyers eventually pleaded guilty to racketeering charges. But
the other, Portland attorney Nick Albrecht, escaped prosecution. Now, seven
years after Frederick Hugh Sturgis was caught in the drug sting and began
cooperating with authorities, prosecutors are going after Albrecht's
license to practice law.

A three-member Oregon State Bar trial panel heard testimony during the past
two weeks against Albrecht, a downtown lawyer whose practice has included a
good deal of real estate work. If the panel finds "clear and convincing
evidence" against Albrecht, it almost certainly will recommend that the
state Supreme Court strip him of his license.

The trial is the third time the story Sturgis told has brought accusations
against Albrecht.

Indictment returned

Albrecht and the other attorney, George Haslett Jr., were among four people
accused of racketeering in a 15-page indictment by a Multnomah County grand
jury on Aug. 26, 1993.

One of the others was Brian Keith Charlesworth, whose home at Henry Hagg
Lake in Washington County was raided by 20 officers of the Regional
Organized Crime Narcotics Task Force in March 1992. He later pleaded guilty
in federal court to racketeering involving laundering more than $350,000
from sales of cocaine, methamphetamine and marijuana. The government
dropped drug charges, and Charlesworth was sentenced to seven years, eight
months. An associate in the drug operation also went to prison. So,
separately, did Sturgis.

But the charges against the two attorneys, Albrecht and Haslett, were
dismissed in March 1994. Circuit Judge William C. Snouffer ruled that
Oregon's racketeering laws did not then cover money laundering. But federal
laws did, so Multnomah County handed the case to federal prosecutors, who
quickly got a federal indictment against the lawyer.

Almost a year went by before federal prosecutors dismissed the indictment.
By then, the deadline had passed for county prosecutors to appeal the state
court ruling.

Troubles appear over

It looked as if Albrecht was free of the issue. Haslett, whom Albrecht said
he barely knew, had not been so lucky. There was evidence Haslett was
directly involved in Charlesworth's drug operation. Because he was 71 when
convicted of racketeering on July 28, 1995, he was sentenced to three
years' probation and ordered to resign from the bar organization.

But Norm Frink, Multnomah County's chief deputy district attorney, wasn't
through with Albrecht. Frink wrote a formal letter of complaint to the bar
group in April 1995, saying the district attorney's office had evidence
that Albrecht was involved in crimes. That prompted another investigation
and the recent trial before the bar panel.

According to regional task force documents filed in various court
proceedings, Sturgis told federal narcotics investigators that Albrecht
knew Charlesworth was spending drug money. In fact, Sturgis said the lawyer
had described how to launder money by buying real estate for a low down
payment and then inflating the monthly payments. That way, large sums of
cash could be turned into property without attracting suspicion.

But Sturgis did not testify at the bar trial, in which he could have been
cross-examined. The only direct testimony against the lawyer was from
Curtis Farber, 43, a convicted murderer and reluctant witness with an
immunity agreement from Multnomah County. Farber said he was a middleman in
buying real estate with money Charlesworth provided.

Asked whether he specifically told Albrecht that he was buying real estate
with "drug money," Farber said, "I don't know how it was phrased, but we
did speak on that level, yes."

Scheme is complex

The money-laundering scheme using real estate transactions is complex.

The key figures were Farber, Charlesworth and John Sturgis -- Fred's
brother. They met in the penitentiary, where they were incarcerated for
various crimes. Farber was serving a life sentence for hiring a
drug-dealing friend to kill Harry "Skip" Foss Jr., a big Portland-area
cocaine supplier.

The three were released from prison several months apart and eventually
reunited in the money-laundering scheme.

Farber said he started selling cocaine but also worked at a series of
legitimate jobs, including selling real estate partnerships for a local
company. He said he also earned about $2,000 for standing in for
Charlesworth in real estate deals. Sturgis also was involved and,
initially, funneled the money to Farber.

Albrecht's attorney, Marc Blackman, insisted that Albrecht didn't know he
was being used by three former felons to launder drug money.

That's because Charlesworth used at least four aliases backed by false
identification. Albrecht said he only knew Charlesworth by the name David
MaGuire. MaGuire was described as a businessman so rich he was bored by the
petty details of buying real estate and sent Farber to handle them.

And although Albrecht was involved in preparing papers in some transactions
- -- normal legal services for which he charged usual fees, Blackman said --
he was not part of others, which Farber completed without a lawyer or, in
one case, with the help of another attorney.

Bar group brings complaint

Beyond money laundering, the bar organization also complains that Albrecht
failed to protect the interests of people whose names appeared on checks
Albrecht deposited in a trust account under Farber's name. Albrecht
testified that he believed what Farber told him -- that the checks came
from investors who wanted to be Farber's partners in real estate deals.

Farber said he and John Sturgis made up the names -- to turn Charlesworth's
money into cashier's checks. Farber said he told Albrecht: "The money did
not come from those people."

When Farber and Charlesworth had a falling out in 1989, Farber asked
Albrecht for all but a few dollars of the trust account money so he could
buy some property. Albrecht gave him a check for about $52,000. Farber
testified that he left Oregon with the money, which mostly belonged to
Charlesworth.

Albrecht said he could disprove several of the bar group's financial
accusations if a computer crash, verified by the technician who tried to
fix it, had not wiped out his records. He also said his wife destroyed some
records stored in his garage that became water-damaged.

Blackman said the bar group's complaint that Albrecht took money belonging
to other people failed to recognize that, by law, the money was under the
control of the person Albrecht knew as "MaGuire" and of Farber. They were
clients, he said, and Albrecht had a duty to follow their directions.

Checked-by: Mike Gogulski