Defense attorney derides former NY body armor executive’s testimony vs. 2 co-workers

Defense derides former exec in NY body armor case

CENTRAL ISLIP, N.Y. — The former chief financial officer of a company that supplies body armor to the U.S. military lied in support of a government prosecution of two other top executives facing fraud and other charges, a defense attorney claimed Tuesday.

“They knew she was a liar before they put her on the witness stand,” defense attorney Kenneth Ravenell said of Dawn Schlegel on Tuesday during closing arguments. Schlegel was the government’s key witness, testifying for 23 days during a six-month-long trial. She was not in the courtroom on Tuesday.

Former DHB Industries, Inc., chief executive David H. Brooks, and Sandra Hatfield, the former chief operating officer, are accused of falsely inflating the value of the inventory of the company’s top product, the Interceptor vest, to help meet profit margin projections in a scheme that netted Brooks $185 million and Hatfield $5 million.

Brooks also is accused of looting the company treasury of millions for vacations, jewelry and his horse racing business, although Ravenell contends his client had received permission in 1997 from the company’s board of directors to make the purchases.

There are no allegations that the vests or other DHB products were unsafe.

Ravenell noted that Schlegel, who has pleaded guilty to conspiracy to commit fraud, had admitted lying on her income tax returns. He contended that while she was initially facing 75 years in prison, her cooperation with federal prosecutors could see that sentence reduced to 10 years or less.

Ravenell said that during her testimony, Schlegel had tearfully said that her guilty plea will result in a felony conviction on her record, but that the woman later confessed on the witness stand that the sobbing had been rehearsed during a meeting with prosecutors.

The defense attorney also noted that Schlegel was the only witness during the trial to accuse Brooks of concocting a story claiming 62,000 vests were destroyed in a hurricane when the vests never actually existed. He claims the accusation against Brooks is not true.

He also argued that as chief financial officer, Schlegel should have been aware that Brooks received permission in 1997 to charge his personal expenses on a company credit card.

“We know Mr. Brooks spent the money, the question is was it authorized?” Ravenell said, insisting that permission had been granted. He said Brooks had put as much as $20 million of his own money into the business in the years after acquiring it in 1995. He said the spending on personal items amounted to less than what he was owed.

Prosecutors counter that the 1997 document authorizing the spending was a forgery and that Brooks was actually looting the company treasury for lavish bat and bar mitzvahs for his children, European vacations, jewelry and other luxuries.

Brooks resigned from DHB in July 2006, about the same time the company relocated its headquarters from Westbury, N.Y., to Pompano Beach, Fla., where it operates as Point Blank Solutions Inc.

Hatfield left the company in November 2005. Her attorney is expected to make closing arguments Wednesday.

The Interceptor vest, designed to withstand rifle fire and shrapnel, was made for the Marine Corps and other branches of the military. The company saw its fiscal fortunes soar after the Sept. 11, 2001, terror attacks and the military responses in Afghanistan and Iraq.

Brooks and Hatfield also are accused of failing to report to the IRS more than $10 million in bonus payments they and other DHB employees received.