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<b>BURNED BRIDGES:</b>  David Lack (left) with Mary Belle Snow (right), in better days before she accused him of embezzlement, are shown here with Carly Fiorina, then a GOP candidate for U.S. Senate.

Courtesy Photo

BURNED BRIDGES: David Lack (left) with Mary Belle Snow (right), in better days before she accused him of embezzlement, are shown here with Carly Fiorina, then a GOP candidate for U.S. Senate.


Prosecution Launches Attack on David Lack

Is the Contractor and GOP Bigwig Guilty of Financial Chicanery?


Contractor David Lack’s alleged theft of $1.5 million by false pretenses and embezzlement may not qualify as the crime of any century, but his trial ​— ​scheduled to take four weeks ​— ​could easily feel twice that long to the jurors deciding the fate of the well-known builder and high-profile Republican. That’s in part due to the number of objections filed by the two attorneys involved. Prosecutor Brian Cota was barely into the third sentence of his opening statement before Lack’s defense attorney, Robert Sanger, lobbed the first of what would be hundreds of legal objections. For his part, Cota gave as good as he got, peppering Sanger with similar objections, further bogging down testimony that dwelled on the minutia of lending institutions.

At the trial’s outset, two things became clear: First, Cota and Sanger do not get along. In pretrial motions, Sanger objected to Judge Jean Dandona that Cota used personally insulting adjectives in describing his various motions. Cota, in turn, complained Sanger used the less favorable term “the government” when referring to the prosecution, rather than the legally correct expression “the people.” Sanger claimed he was worried Cota would use “the people” so expansively that jurors might think it included them. Judge Dandona dismissed such concerns, saying she couldn’t even imagine a situation that would fit Sanger’s hypothesis.

Second, both of the banks allegedly ripped off by Lack ​— ​Bank of Santa Barbara and Rabobank ​— ​appear to have been soundly asleep at the switch when it came to verifying his applications for $1.2 million in lines of credit in 2007. The heart of the prosecution’s argument rests with Lack’s assertions that he owned a Montecito residence worth $1.3 million and undeveloped land near Dallas, Texas. Had the banks known that Lack did not own them, and that he owed $181,000 to a longtime friend, they might have turned down his credit applications. It wasn’t until Lack’s bankruptcy in 2010 that his lack of ownership of the two properties came to light. Judge Dandona ruled that the banks’ failure to exercise due diligence did not get Lack off the hook on the allegation of criminally victimizing them. She also ruled that the attorneys could not ask questions exploring whether the banks were accomplices in their own undoing.

Beyond that, Lack is accused of using for his personal purposes $241,000 of the $300,000 Montecito resident and outspoken conservative activist Mary Belle Snow gave him to start a new bank. According to Cota, although Snow invested the money with strict instructions that Lack use it for no other purpose, when he got behind in his payments in 2009, Lack used her investment to stay afloat.

Giving the case marquee power is Lack himself, a low-key Iowa transplant whose company specialized in environmentally friendly construction for high-profile clients, such as UCSB, and at one time claimed 33 employees. Lack became ubiquitous in Republican Party circles over the past 20 years, squiring the likes of Rudy Giuliani ​— ​then a presidential aspirant ​— ​and Arnold Schwarzenegger ​— ​then California’s governor ​— ​around town. With an immediate congeniality, Lack also appears to have a genius for ingratiating himself with powerful Republican matriarchs and then falling flamboyantly out of favor ​— ​with Marian Koonce and her family in the ’90s, and now with Snow.

Lack’s attorney conspicuously avoided the bankruptcy details in his opening argument, instead countering prosecutor Cota’s portrayal of Lack as a flimflam man pretending to be wealthier and more politically connected than he really was. Sanger described Lack as a hard-working, successful businessperson who lived a modest lifestyle in accordance with his frugal beliefs as a Republican activist. He’d taken out the loans before the economy tanked, Sanger said, and once the Bank of Santa Barbara was up for sale, its managers ​— ​desperate to cut their losses ​— ​cut back on businesses like Lack’s that relied on lines of credit. More than that, Sanger charged, bank executives went to UCSB and notified administrators that Lack’s loans were bad, costing his company work and making it impossible for him to pay his loans.

As for Snow, said Sanger, she went into the bank deal with her eyes wide open. When she discovered Lack had spent her money ​— ​Cota would claim Lack kept her in the dark for a year ​— ​Snow, Sanger charged, enlisted a retired police officer to lobby the District Attorney’s Office for a law-enforcement jihad against Lack. One week before trial was scheduled to begin, Lack was arrested on separate charges ​— ​though very much related to the first ​— ​and jailed for a weekend.

For Sanger, it was a case of bad economic times hitting good people. “I respectfully submit this is a mess,” he said, “but not a criminal mess.” Cota, noting how Lack used business loans to pay off personal expenses, insisted otherwise. Some thieves, Cota said, use bolt cutters, lock picks, ski masks, and even guns. But Lack “used this,” he said ​— ​holding an object with his right arm raised skyward ​— ​“a ballpoint pen.”

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