IOWA, Waukee accountant may be freed soon after drug charges dropped

OFF THE WIRE
A Waukee accountant and alleged ringleader in a national drug conspiracy could be released soon from prison.

Prosecutors in the U.S. attorney's office in Iowa's southern district will have to decide whether to appeal a decision by Judge Robert Pratt to dismiss remaining charges against Russell Schoenauer, 59, and set him free.

The judge said in a decision Tuesday that Schoenauer should not have to go through a new trial because of ineffective assistance by his Omaha attorney, James Martin Davis, combined with the government's failure to produce key evidence at his original 2002 trial.

Schoenauer has served out a 10-year sentence on gun charges. But Pratt vacated drug and conspiracy charges against him in September.

Schoenauer 's trial was the subject of a Des Moines Register series in 2002 about the use of prison "snitches" in federal drug cases.

Prosecutors in the U.S. attorney's office contended he was a drug kingpin, tied since 1994 to the Sons of Silence motorcycle gang.

Federal agents watched Schoenauer for 10 years before his 2001 arrest, alleging in an indictment that he was the gang's national treasurer.

The Harley-riding businessman, who acknowledged a drug problem but always insisted he was innocent, was accused of supplying club members with weapons and drugs, and teaching them how to hide their drug money.

Although the government subpoenaed volumes of Schoenauer's personal and business records, prosecutors provided little proof during the seven-week trial that he laundered money through his many businesses for the Colorado-based biker club. An investigation by the IRS also failed to uncover wrongdoing in some $2.6 million in unexplained income.

However, a jury convicted the accountant anyway, largely because of testimony offered by prisoners who received reduced sentences for their cooperation. Pratt sentenced Schoenauer to 17 years in prison.

Schoenauer's new attorney, J. Justin Johnson of Kansas City, said his client hopes to leave a Yankton, S.D., prison and return to his wife, Dee, and two sons in Waukee.

Johnson said the case underscores why anyone on a federal jury should be "naturally skeptical" when the government uses powerful enticements, such as reduced sentences in return for testimony, to convict someone.

Once worth more than $14 million, Schoenauer and his wife had to spend "a great deal of money" to appeal his conviction, Johnson said.

Johnson said the Federal Bureau of Prisons controls when and if Schoenauer is released. He said he believes the release should be immediate, especially since an appeal by the government to stay Pratt's September decision already has been denied.

A representative for the U.S. attorney's office said Pratt's decision is being reviewed in consultation with the Department of Justice.

http://www.desmoinesregister.com/article/20101104/NEWS01/11040359/-1/LIFE04/Waukee-accountant-may-be-freed-soon-after-drug-charges-dropped