Steve Lieberman

slieberm@lohud.com

A defense lawyer for Ramapo Town Supervisor Christopher St. Lawrence, who is accused of manipulating the town's bottom line, continued Tuesday to hammer away at the government's suggestion that potential bond investors were concerned with the health of the town's general fund.

St. Lawrence faces a 22-count indictment charging him with committing securities fraud, conspiracy and wire fraud. The charges allege he falsely inflated the town's general fund to get better rates on bonds to finance a baseball stadium and other projects, such as the Ramapo Commons townhouses on Elm Street, through a quasi-governmental agency, the Ramapo Local Development Corp.

Tuesday is the third day of trial in his corruption case, which is taking place in U.S. District Court in White Plains.

READ: Indictment of Christopher St. Lawrence

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On the stand: Ned Flynn, managing director of Jefferies LLC, which was the underwriter for a $25 million bond for the baseball stadium; followed by Thomas Myers, a private attorney who worked with the RLDC on the bond representing Jeffries.

Key testimony: Michael Burke, St. Lawrence's defense lawyer, led Flynn through a series of documents connected to the bond issues in question to show that revenues were described as "anticipated redemptions" — essentially estimates. A budget line for money said to have been received from the Federal Emergency Management Agency for flood damage was, similarly, an estimate of what St. Lawrence believed would come in to the town, Burke suggested.

Burke referred to a roughly $1 million difference listed in the town's 2010 fund balance between the town's audited and unaudited revenues, with the audited number being lower. He asked Flynn if that caused a "market reaction" for investors; Flynn said it did not.

Burke also pointed out through his questioning that Ramapo has always had a high bond rating, with an A1 rating with a negative outlook the lowest it ever received. It also had a "MIG-1" investment grade rating for its short-term bonds; Flynn said that was the highest ranking assigned to such investments.

He said he dealt mostly with St. Lawrence, the head of the RLDC, and the town finance director. "When we were talking to (St. Lawrence) we believed we were talking to the right person," he said.

Flynn acknowledged he spoke with the SEC three times and the U.S. Attorney's office three times after receiving a "target letter" informing him he was under investigation in connection with his work on the Ramapo bond issues. He said he later received another letter that said there was no enforcement action being recommended in his case.

Myers, like Flynn, said he got most of his information, including estimated financial information, from St. Lawrence.

In 2013, when the town had to refinance the $25 million baseball stadium bond from five years to 28 years, he said he spoke to St. Lawrence and that St. Lawrence told him the primary sources to repay that debt were revenue from the Ramapo Commons housing sales and from the baseball stadium, neither of which was coming in as expected.

Myers also worked for the town as a disclosure counsel helping it to prepare the bond offering, including informing potential investors about the then-ongoing federal investigation into town finances.

Up next: Myers, who is now being cross-examined by Burke, will continue his testimony on Wednesday. Court proceedings are expected to run from 9:30 a.m. to 2:30 p.m. daily, with a half-hour break at midday, the judge previously announced.

Earlier trial coverage:

OPENING STATEMENTS: Defense, prosecution set out case; first witness

TRIAL, DAY 2: Questionable bond issues detailed