Newspaper article St Louis Post-Dispatch (MO)

Webster Called Allegations `a Fantasy,' Ex-Aide Says

Newspaper article St Louis Post-Dispatch (MO)

Webster Called Allegations `a Fantasy,' Ex-Aide Says

Article excerpt

James B. Deutsch didn't pay much attention to Missouri's Second Injury Fund during his first two years as the top aide to former Missouri Attorney General William L. Webster.

"I didn't go around looking for problems," Deutsch testified at a hearing in federal court Friday.

Then, he said, the problems found him.

Deutsch described how he scrambled last year to figure out what had gone wrong with the fund in the wake of newspaper reports of alleged extortion, seemingly outrageous payouts and the sudden interest of federal investigators in bills submitted by lawyers Webster had hired.

Deutsch was called as a witness by Webster, who has admitted embezzlement and conspiracy charges but denied allegations that he was part of a scheme to favor lawyers who did business with the Second Injury Fund in return for campaign contributions. U.S. District Judge D. Brook Bartlett is considering the evidence to determine what sentence he will give Webster.

The hearing is to resume Monday, when Webster is expected to testify.

Deutsch said he got the first hint of problems with the fund in the fall of 1991, when he learned of a dispute between private attorneys whom Webster had appointed to defend the fund against claims by injured workers.

When Deutsch looked closer at the fund, he found that lawyers were settling cases that had not been assigned to them, a policy encouraged by administrative judges desperate to remove the increasing backlog of thousands of claims. Deutsch also discovered that the office's attorneys were not appearing at hearings on cases to which they had been assigned.

"It was hard for us to keep track of what they were doing," he said.

Deutsch said he and Webster met with their Second Injury Fund lawyers in January 1992 and told them to shape up.

After the meeting, another top Webster aide, Kevin King, told him he had been too hard on the lawyers, and Deutsch wrote a letter telling them their performance had been "amazingly problem-free and professional."

One of those letters was sent to William E. Roussin Jr., a Second Injury Fund lawyer who raised hundreds of thousands of dollars for Webster's campaigns. Roussin has pleaded guilty of defrauding the fund and testified that Webster knew of his scheme to favor plaintiffs' lawyers who made campaign contributions.

Deutsch said that King was the aide responsible for the defense of the fund and "trusted Bill Roussin very much . . . He felt Roussin was a first-rate lawyer and a first-rate guy . . . They became good friends."

After the meeting, Deutsch said he thought any problems with the fund had been resolved.

Weeks later, the Post-Dispatch began publishing articles linking Webster campaign contributions to higher settlements from the fund. Then, federal investigators demanded Roussin's files of Second Injury Fund cases to determine whether he was defrauding the state by overbilling for his work. …

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