Friday, December 31, 2004

Rutledges are told
to wear trackers

Former labor leader Tony
Rutledge and his son Aaron
are deemed flight risks

A federal judge increased ousted Unity House Inc. President Tony Rutledge's bail to $500,000 yesterday and ordered him to wear an electronic ankle bracelet to monitor his whereabouts by satellite.

In a bail hearing in U.S. District Court, Magistrate Leslie Kobayashi also barred Rutledge and his son Aaron from going near Honolulu Airport after federal prosecutors said they are potential flight risks.

Kobayashi's ruling came after prosecutors seized Unity House and the Rutledges' personal assets this month, saying the Rutledges looked to move some of Unity House's assets into foreign bank accounts that are outside of the federal government's jurisdiction.

Assistant U.S Attorney Ted Groves had asked that the Rutledges be placed under home confinement and that their bail be increased to $1 million from the current $50,000. Groves alleged that the Rutledges committed new criminal acts even after a federal grand jury indicted them in August 2003.

"Clearly they didn't get it," Groves said. "They attempted to move money offshore with the intent of putting money beyond the reach of the government."

He said the receiver in charge of Unity House, Anthony Pounders of EG&G Technical Services Inc., has discovered new financial problems that will likely result in more legal actions against the Rutledges.

Groves said Unity House's assets have dwindled below the $42 million that the nonprofit lists on its books. He added that financial problems threaten some services that Unity House provides for its members and retirees.

Tony Rutledge said he is not surprised that prosecutors are looking to eliminate benefits, and noted that the seizure is part of a long-running campaign by federal prosecutors to shut down Unity House.

Rutledge said much of Unity House's assets is invested in stock funds, which have done well.

"Talk is cheap," Rutledge said. "We'll see what happens when this gets to court. We'll get our say."

Jeff Rawitz, Rutledge's attorney, denied that the Rutledges are a flight risk, saying the elder Rutledge, who is diabetic, is unable to travel and does not have the means to do so after the government seized his personal assets.

Rawitz said prosecutors' concerns "that there is a pot of money in the Bahamas" is incorrect.

"There is no allegation that Mr. Rutledge moved one penny anywhere. The money is all at Unity House," Rawitz said.

Under Kobayashi's ruling, the Rutledges will have to wear electronic ankle bracelets, which will be monitored by a global positioning satellite. They will be allowed to move freely in the island but are barred from going near the airport or onto properties owned by Unity House.

The Rutledges, who have pleaded not guilty to the criminal charges, are scheduled to go to trial on Jan. 11, but prosecutors believe the date will be pushed back. In court papers filed earlier this week, the Rutledges' lawyers introduced the results of a 2001 lie-detector test by a private company. The test indicated that Rutledge was truthful when he said did not defraud the organization, according to the filing.

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