Key Bank wiretaps thrown out

Published March 9, 1993|Updated Oct. 8, 2005

A Hillsborough County judge has thrown out wiretap evidence in the Key Bank fraud investigation, a ruling that could mean the end of a case investigators once promised would ensnare prominent businessmen, Mafiosi, and even the husband of Tampa's mayor in a drug dealing and money laundering conspiracy.

Hillsborough Circuit Judge M. William Graybill's ruling stripped prosecutors of crucial evidence taken from hundreds of hours of recorded conversations.

Defense attorneys, who have attacked the case as politically motivated, cheered the ruling.

Prosecutors said they will appeal.

"The right to privacy is alive again in Hillsborough County," said Joseph Ficarrotta, who represents bank president Frank Pupello and his son, bank vice president Michael Pupello.

"There was no basis of law for this prosecution and there is no basis of fact. This decision probably saved the taxpayers $300,000," said Ralph Fernandez, attorney for Santo J. Trafficante III, called by investigators a member of the Mafia.

Prosecutors said late Monday that they will appeal Graybill's ruling this morning in an effort to preserve the cases against the five defendants. It was not clear on what grounds prosecutors would file the appeal.

In fact, Graybill gave no indication in his terse ruling how he came to his decision.

"This order speaks for itself," Graybill said.

Defense attorneys had claimed the applications for the wiretaps were riddled with errors and lacked crucial information that would have influenced the judge's decision to approve the wiretaps.

They also claimed investigators listened to too many phone calls, some of them personal, between people not targets of the investigation.

Bill James, former Hillsborough state attorney whose office filed the original charges, expressed dismay over the ruling.

"To say I'm surprised would be the understatement of the year," James said. "These affidavits were reviewed by numerous attorneys and another circuit court judge. We certainly dotted all the i's and crossed all the t's."

Even though prosecutors have said their case would be crippled by the loss of the wiretap evidence, no decision has been made to drop charges.

The cases most in jeopardy are ones that rely directly on information gathered from the wiretaps, said Assistant State Attorney Julia Chase.

In one case, Michael Pupello and Trafficante are charged with deceiving federal bank regulators. At Trafficante's urging, prosecutors say, Pupello impersonated Trafficante in phone calls to the Federal Deposit Insurance Corporation, attempting to persuade regulators to reduce Trafficante's debt, prosecutors say.

In another case, Frank Pupello and Anna Lee Duncan, daughter of former Tampa City Council member Lee Duncan, are charged with scheming to defraud a financial institution. Pupello allegedly agreed that a $7,000 certificate of deposit belonging to Duncan's parents would not be reported to another bank so the couple could qualify for a loan.

Prosecutors hope they can save their case against former Hillsborough sheriff's Detective Rickey Dawes, accused of leaking a confidential list of suspects that led to the premature end of the Key Bank investigation in August.

Prosecutors hope other loan fraud charges against Trafficante can be saved because the evidence did not come from wiretapped conversations. None of the loans were made by Key Bank.

Dawes' attorney, Manuel Lopez, said, "I think there's a likelihood that the suppression of the wiretap will affect Mr. Dawes."

Lopez said that from what he knows of the investigation prosecutors probably would not have received Dawes' name as a suspect if it had not been mentioned in a wiretapped conversation.

Lee Atkinson, a former assis-tant state attorney who oversaw the Key Bank wiretap, said Monday, "I don't believe Mr. Dawes was intercepted or that his name came up during the course of the Key Bank wiretap."

Atkinson, targeted by defense attorneys as mastermind of the wiretaps, defended his role in the investigation and how the wiretaps were conducted.

"I played my normal supervisory role," he said, adding he has participated in about 100 wiretap investigations over the last 12 years.

At Pupello's Culbreath Isles home Monday night, a nephew said Pupello would not comment on Graybill's decision.

"We, as a family, are extremely happy about the decision," Joe Pupello said. He added the family is "very thankful and we look forward to getting on with our lives."

_ Staff writer Richard Danielson contributed to this report.


1974: Key Bank opens in West Tampa.

1977: Bank president James Porter is convicted for taking kickbacks for loans.

1983: The Florida Comptroller's Office picks up numerous indications that the bank is violating currency transaction reporting requirements.

1985: State examiners note that the bank has violated regulations that limit how much money can be loaned to any one bank customer.

1991: In April, because of problems uncovered by regulators, the FDIC and Comptroller's Office place the bank under a restrictive 11-point monitoring program.


July 3: Bank president Frank Pupello is taped during a phone call with the bank's lawyer, Michael Freedman, discussing ways to falsify documents to avoid paying taxes on money owed to the bank. July 8: Investigators tape conversations indicating Pupello and two other customers agreed to misrepresent the existence of one of the bank's loans to another financial institution.

Aug. 7: Law enforcement agencies arrest Pupello for making a false entry in an FDIC report and for delivering false documents to the agency. Michael Pupello, son of the elder Pupello and a bank vice president, is charged with perjury.

Sept. 25: A 10-agency task force investigating the bank files 59 felony charges against 14 people including bank executives, Freedman, former City Council president Lee Duncan and members of a local crime family once headed by Santo Trafficante Jr.

Nov. 6: A grand jury returns the first federal indictment, charging Frank Pupello, Williams and Bernstein with conspiring to hide large deposits from the IRS.


Jan. 7: Bank attorneys file documents saying that wiretaps were a "gross intrusion," that there was insufficient probable cause crimes were being committed, and that some conversations were protected by attorney-client privilege.

Jan. 15: Judge M. Wm. Graybill dismisses charges against Freedman, Frank Pupello and Lester Hirsch, an adviser to the bank's board of directors, saying the statute they had been charged with was applied improperly. Pupello still faces other charges.

Feb. 4: In a hearing before Graybill, the bank's attorneys hammer at errors and omissions in the affidavit used to get approval for the wiretaps. Citing a lack of evidence, State Attorney Harry Lee Coe III dismisses all charges against seven defendants, leaving only five of the original defendants, including the two Pupellos and Santo Trafficante III, to face trial.

Sources: Times files

Compiled by Times news researcher Kitty Bennett