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Jeff German

Federal judge dismisses charges of conspiracy, illegal gambling in Phua case

2 June 2015

A federal judge Monday dismissed conspiracy and illegal gambling charges against wealthy Malaysian businessman Paul Phua after prosecutors admitted their case had collapsed.

Prosecutors fought the dismissal in court, but U.S. District Judge Andrew Gordon said it was the proper decision after prosecutors told him they no longer had enough evidence to present at trial.

Assistant U.S. Attorney Cristina Silva said prosecutors were considering appealing the dismissal and Gordon’s decision last week to throw out the bulk of the evidence.

Gordon had barred the government from using evidence FBI agents seized from Caesars Palace villas during a July 9 raid on an alleged operation that accepted millions of dollars in illegal wagers on World Cup soccer. Gordon said the evidence was the “fruit” of illegal FBI searches before the raid.

Silva tried to keep the case alive while prosecutors sought to appeal Gordon’s decision on the evidence, but defense lawyers David Chesnoff and Thomas Goldstein countered that would unfairly leave Phua to “twist in the wind.”

Phua, 51, a widely known poker player and Strip high roller worth hundreds of millions of dollars, was supposed to stand trial June 15.

The dismissal means his $2 million bail, $48 million jet and passport will be returned, and he is free to go back to Malaysia to see his ailing mother. He has been forced to stay in Las Vegas under court-ordered electronic monitoring for the past 10 months as the legal drama over his arrest played out.

His lawyers told Gordon he plans to leave the country as soon as possible.

“Paul Phua stood his ground for himself, his friends and family and all of us,” Chesnoff said after the court hearing. “Ultimately, he has been vindicated by our constitutional system and the honesty and strength of our federal judiciary. He is free.”

Goldstein, an expert in constitutional law, added, “Paul Phua stayed in the United States to defeat these charges because he was innocent and because the government’s misconduct made the case even more unjust.”

Phua was among eight defendants from Malaysia and China charged in the international betting case.

Six defendants pleaded guilty and were each fined and sentenced to five years of probation with the condition they stay out of the U.S. during that period. The case against a seventh defendant was dismissed.

Gordon ruled in April that FBI agents violated Phua’s rights when they entered his Caesars Palace villa posing as Internet repairmen to secretly gather evidence days before the July 9 raid. He prohibited prosecutors from using any evidence agents obtained through the unprecedented ruse, which he said amounted to an illegal search.

Then, under the legal doctrine "fruit of the poisoned tree," defense lawyers sought to bar prosecutors from using evidence seized from two other luxury villas. One of the villas was alleged to have been operating as a betting boiler room, with several computers and television monitors set up to handle the action.

Gordon tossed out that evidence last week.

Prosecutors contended the Phua group earned $13 million in profits while at the Caesars Palace villas last June and July. The Strip resort cooperated in the investigation.

The betting case attracted national and international attention because of the ruse and Phua’s prominence in the worldwide poker community. Professional poker champion Phil Ivey helped put up his bail.

FBI agents and prosecutors alleged Phua was a member of an Asian organized crime syndicate, but defense lawyers strongly denied the allegation and attacked the government for providing what they called flimsy evidence of the connection.