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Crime & Courts

Defense in fraud trial trying to show that Avery had plans for planes, boats

  • Author: Lisa Demer
  • Updated: June 25, 2016
  • Published February 19, 2016

Training for the Philippine Air Force. U.S. security details in Africa and international medevacs across the polar cap. Tours of Prince William Sound for dignitaries who need constant protection.

Pieces of Mark Avery's defense are emerging as he tries to convince jurors his sensational spending back in 2005 was not a $52 million fraud but a legitimate, ambitious attempt to start a string of fantastic-sounding businesses. And, defense witnesses told jurors, Avery's right-hand man was running much of the show.

After 19 government witnesses took the stand in the downtown Anchorage federal courtroom, it's now the defense's turn to take on accusations that Avery schemed for access to an elderly widow's trust, then sidestepped an agreed-upon plan to buy one or two top-end executive jets for air charters and medevacs. Instead, he blew $52 million from a loan backed by the May Smith Trust in less than six months without ever creating a profitable business, prosecutors say.

On Friday, jurors heard from a doctor and a paramedic about a plan to start a medevac service.

The seed was planted during the move of May Smith from the island of Guernsey in the English Channel to her newly bought home in the Bahamas, paramedic Dennis Hopper told jurors. She's the wealthy widow whose money Avery was supposed to guard as one of three trustees.

Hopper now lives in Mississippi but for years worked as a flight medic in Alaska. Hopper, who also buys, sells and modifies guns, knew Avery through the Alaska Machine Gun Association. Avery asked him to serve as the flight medic for, as Hopper called her on the stand, Miss May.

On the flight and afterward, Hopper said he talked with Rob Kane, Avery's top man, about the possibility of starting a worldwide medevac service to fill what Kane described as a need for transports of injured or ill military members, diplomats and other U.S. citizens, Hopper said.

"I said anytime that we can save American lives, I want to be involved in it. I want a piece of that pie," said Hopper, who wears a U.S. flag lapel pin and served 20 years in the Air Force with 10 more in the reserves.

He said he went to work for one of Avery's businesses, Regional Protective Services. He traveled to St. Louis, Missouri, with Michael Farrell, a former Reagan White House lawyer and contact of Kane's, to look at an executive Gulfstream jet that one of Avery's firms then bought.

The Gulfstream, which prosecutor Steve Skrocki said was bought for $5.5 million and soon sold for $2 million less, was reconfigured with a specially engineered gurney lift, a medical bed and monitors, Hopper said.

Both Hopper and Donald Hudson, a physician, testified that they became part of the team trying to create a medevac program, using Anchorage's strategic location as a selling point. A PowerPoint presentation said that Anchorage is within nine hours of 95 percent of the industrialized world, counting flights across the polar cap.

Hudson, a former Air Force flight surgeon, said he had helped develop Alaska Regional Hospital's medevac service. Avery hired him for $20,000 a month to serve as medical director of what they called Aero Resources but then, when the businesses were in financial trouble, tried to cut it to $1,000. Hopper said he didn't remember what he was paid.

Aero Resources never did any medevacs, though one of Avery's other companies used that Gulfstream for a medevac to Singapore, Hopper told jurors.

Who was calling the shots? asked Mike Dieni, Avery's defense lawyer.

"Cmdr. Kane," Hopper answered, describing it as a term of respect for his boss. It's also what Kane, who never served in the U.S. military, liked to be called.

Dieni asked Hopper about a yacht and a patrol-like Moose Boat bought by Avery.

The yacht, Hopper said, would be a lure to bring foreign dignitaries and executives to Alaska. The Moose Boat would provide "shadow security," he said. Avery had testified in bankruptcy court that he got the idea for boat tours with executive protection from the concierge at the Millennium Alaskan Hotel, jurors were told Thursday.

Earlier in the trial, the defense called retired Col. Joe Griffith, a Vietnam combat pilot who served 24 years in the Air Force.

Griffith said Kane hired him to figure out a business use for his fleet of Czech fighter jets.

"We put together proposals as rapidly as we could to use the assets," Griffith said.

One plan was to use the military fighters to train Philippine Air Force fighter pilots and another was to train the U.S. Air Force, he said. A third proposal was intended to help the United Nations deal with safety problems in Africa, Griffith told jurors. He said he wasn't sure if all the proposals were even submitted.

What was Kane's role? Dieni asked.

"It was my impression that Rob Kane called the shots," Griffith said.

Did he handle the money? the defense lawyer asked.

"If I needed money for anything I was doing, I went to Rob," Griffith answered.

How much revenue did the Czech fighters -- which Griffith said were in rough shape and not flyable -- bring into Avery's Security Aviation? prosecutor Skrocki asked.

"I think the answer was zero," Griffith said. "I don't think we ever got paid for anything that we did."

The trial is scheduled to continue Monday with defense witnesses. Skrocki told U.S. District Court Judge Ralph Beistline that he is anticipating that Avery will testify, though the defense hasn't said whether that is the case.

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