Kimmel pleads guilty

29-May-08 – Gary S. Kimmel pleaded guilty on Thursday afternoon to federal charges of money laundering. A second charge of racketeering has been dismissed.

The Marina City resident was caught up in a nationwide prostitution ring. He explained to Judge Blanche M. Manning that he did not know at the start that he was doing anything wrong – but once he did realize it, he did not stop.

“I rented a couple of units to unsavory characters,” he told the judge in U.S. District Court. When his tenants approached him about helping them purchase vehicles, he agreed to help but “I should have known earlier that something wasn’t right.”

When asked by Judge Manning if he was satisfied with the plea agreement that he signed, Kimmel’s voice choked with emotion as he replied, “Satisfaction is not always the way it works out, but I’ve been told it is in my best interests to proceed.”

Manning quizzed Kimmel on his competency to change his plea, and his understanding of the rights he was giving up. In the end, she accepted his plea and scheduled sentencing for September 25.

Kimmel was flanked by his attorneys, Joseph Lopez and Paul Zido. Representing the U.S. Government was Julie Ruder.

“Both sides made concessions in this case,” said Lopez. “It was a fair deal for both sides despite what others may think. This deal was the only way to dispose of this case. To go to trial would have been a disaster since [Kimmel] made admissions to the FBI agents after he was told he would not go to jail if he cooperated.”

With his dentist license suspended since June 2006, Kimmel told Judge Manning he currently works as a bank courier. When asked about his health, the 59-year-old said he has a hernia, sleep apnea, and is taking medication for high cholesterol.

The maximum penalty is 20 years in prison and a fine, which in this case could be between $500,000 and $800,000. Preliminary sentencing guidelines call for 37 to 46 months in prison, three years of supervised release, and restitution.

Kimmel reluctantly agreed to terms of forfeiture. He will have to give up approximately $405,000 in addition to the fine. Subject to forfeiture are nine condominium units at Marina City, seven vehicles, personal computers, and collectible coins. However, if he pays the $405,000 he will get to keep units 5617, 5618, and 5619, which includes his current residence.

Kimmel is accused of accepting about $372,000 from alleged pimps to pay for luxury vehicles for use by the prostitution ring. According to the complaint against him, he also supplied dental work, airline tickets, bail money, and helped pay for advertising for the prostitution business.

Kimmel says he did not know at the time that he was involved in money laundering, described in the plea agreement as accepting assets knowing they come from illegal activity. “I accepted money thinking it was from legitimate sources.”

Only after it was explained to him, following his arrest in November 2005, did he realize what had happened. Said Kimmel, “I regret what I’ve done.”

According to Joseph Lopez, Kimmel was involved not for profit but to enhance his credit rating. “He acted as a lien holder for Diamond and White,” the attorney said, referring to alleged pimps Robert Lewis Young (also known as “Blue Diamond”) and Mark Luke White.

“He did not realize his conduct was illegal…since the pimps used their money at grocery stores, department stores and other businesses. Once he was in, he could not get out due to his apprehension in getting the cars back so he could sell them and payoff the notes and move on.”

Lopez says Kimmel was on the hook for more than $250,000 in car loans. He says Kimmel did not promote the prostitution business and “contrary to rumors he did not receive the services of any escort.”

Kimmel’s deal with prosecutors turned sour when he filed claims for vehicles that had been seized, against their wishes but on the advice of his accountant and a civil lawyer. Says Lopez, “His accountant and lawyer got [Kimmel] indicted based on their negligent advice.”

Lopez said Kimmel should have consulted a federal criminal defense lawyer, but instead relied on the advice of federal agents. “I feel really bad for Doc. He got shafted by the system by not having any adequate representation by an attorney or accountant. It is what it is and he did what he did. Now the judge will do what she may.”

Kimmel will be interviewed by a pre-sentencing probation officer, who will submit a report to the court.