cross-examination: sharpstein/tabernacki

222
UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA FORT LAUDERDALE DIVISION CASE NO. 12-20901-CR-WPD UNITED STATES OF AMERICA, . . Plaintiff, . Fort Lauderdale, Florida . June 26, 2013 v. . 8:57 a.m. . CRAIG STANLEY TOLL, . . Defendant. . . . . . . . . . . . . . . . . . - - - - - Transcript of Trial Proceedings had before the Honorable William K. Dimitrouleas, United States District Judge, and a jury. - - - - - DAY 3 - - - - - APPEARANCES: For the Plaintiff: Lois Foster-Steers, Esq. Kimberly A. Selmore, Esq. Assistant U.S. Attorneys 99 N.E. 4th Street Miami, Florida 33132 For the Defendant: Richard A. Sharpstein, Esq. Jacqueline M. Arango, Esq. Ari Gerstin, Esq. Akerman Senterfitt One SE 3rd Avenue, 25th Floor Miami, Florida 33131 Court Reporter: Francine C. Salopek, RMR, CRR Official Court Reporter United States District Court 299 E. Broward Blvd., Room 205F Fort Lauderdale, Florida 33301 (954)769-5657 - - - - - Proceedings recorded by mechanical stenography, transcript produced by computer. FRANCINE C. SALOPEK, OFFICIAL COURT REPORTER (954)769-5657 Case 1:12-cr-20901-WPD Document 195 Entered on FLSD Docket 10/29/2013 Page 1 of 222

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Cross-Examination: Sharpstein/Tabernacki

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  • UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA FORT LAUDERDALE DIVISION CASE NO. 12-20901-CR-WPD

    UNITED STATES OF AMERICA, . . Plaintiff, . Fort Lauderdale, Florida . June 26, 2013 v. . 8:57 a.m. . CRAIG STANLEY TOLL, . . Defendant. . . . . . . . . . . . . . . . . .

    - - - - - Transcript of Trial Proceedings had

    before the Honorable William K. Dimitrouleas, United States District Judge, and a jury.

    - - - - - DAY 3

    - - - - - APPEARANCES: For the Plaintiff: Lois Foster-Steers, Esq. Kimberly A. Selmore, Esq.

    Assistant U.S. Attorneys 99 N.E. 4th Street Miami, Florida 33132 For the Defendant: Richard A. Sharpstein, Esq. Jacqueline M. Arango, Esq. Ari Gerstin, Esq. Akerman Senterfitt

    One SE 3rd Avenue, 25th Floor Miami, Florida 33131

    Court Reporter: Francine C. Salopek, RMR, CRR

    Official Court Reporter United States District Court 299 E. Broward Blvd., Room 205F Fort Lauderdale, Florida 33301 (954)769-5657

    - - - - - Proceedings recorded by mechanical stenography, transcript produced by computer.

    FRANCINE C. SALOPEK, OFFICIAL COURT REPORTER(954)769-5657

    Case 1:12-cr-20901-WPD Document 195 Entered on FLSD Docket 10/29/2013 Page 1 of 222

  • 2

    1 WEDNESDAY, JUNE 26, 2013, 8:57 A.M. 2 (The Judge entered the courtroom) 3 THE COURT: All right. We're back on the record. 4 Counsel are present. Mr. Toll's present. 5 We have a note from one of the jurors: 6 "Dear Judge: I just found out last night that my 7 mother, who is 88 years old and lives in Guyana, got a 8 heart attack last night, and I would like to be 9 excused from jury duty so I can make arrangements to10 go and see her before she pass away. I cannot11 concentrate on this right now. I'm very sorry.12 "Hermena Ledra."13 So, I would propose asking Ms. Ledra to come out and14 excusing her, and we'd move up the alternate -- the first15 alternate, who is Mr. Fernandez?16 Any objection?17 MR. SHARPSTEIN: No, your Honor.18 MS. FOSTER-STEERS: No. No, your Honor.19 THE COURT: All right. Let's ask Ms. Ledra to come on20 out.21 (The juror entered the courtroom) 22 THE COURT: Just have a seat anywhere, Ms. Ledra.23 I'm sorry to hear about your mom. We're going to go24 ahead and excuse you, and I hope you can get to see your mom.25 And if you could just give your juror badge back to Vernelle.

    FRANCINE C. SALOPEK, OFFICIAL COURT REPORTER(954)769-5657

    Case 1:12-cr-20901-WPD Document 195 Entered on FLSD Docket 10/29/2013 Page 2 of 222

  • 3

    1 Did you leave anything in the jury room? 2 JUROR LEDRA: No. 3 THE COURT: All right. Just -- you can go ahead and 4 get your lunch, and then we'll go ahead and excuse you. And I 5 appreciate your willingness to serve. I'm sorry about your 6 mom. 7 (The juror was excused) 8 THE COURT: I've got a meeting at noon today. I've 9 got a 1:15 change of plea. So, we'll break a little bit before10 noon, and then we'll resume at 1:45.11 And I guess we need to get Ms. Tabernacki back on the12 stand.13 Do we have all the rest of the jurors?14 Anything to come before the Court before we bring the15 jury in?16 MS. FOSTER-STEERS: No, your Honor.17 MR. SHARPSTEIN: No, your Honor.18 THE COURT: Okay. Ms. Tabernacki, you understand19 you're still under oath?20 THE WITNESS: Yes.21 THE COURT: Okay. If you can resume the stand.22 Let's bring in the jury.23 COURTROOM DEPUTY: Please rise for the jury.24 (The jury entered the courtroom) 25 THE COURT: Counsel concede the presence of the jury

    FRANCINE C. SALOPEK, OFFICIAL COURT REPORTER(954)769-5657

    Case 1:12-cr-20901-WPD Document 195 Entered on FLSD Docket 10/29/2013 Page 3 of 222

  • 4

    1 and waive its polling? 2 MS. FOSTER-STEERS: Yes, sir. 3 MR. SHARPSTEIN: Yes, your Honor. 4 THE COURT: And did everyone follow my admonition not 5 to discuss the case or allow it to be discussed in your 6 presence? 7 THE JURY: Yes. 8 THE COURT: Mrs. Ledra's mom is not doing well in 9 Guyana, and she needs to go back home and see her. So, I've10 excused Mrs. Ledra. And that means that Mr. Fernandez is now11 on the jury.12 Okay. I think we're ready to resume with the direct13 examination.14 Ms. Foster-Steers, you may proceed.15 MS. FOSTER-STEERS: Thank you, your Honor.16 DIRECT EXAMINATION (CONTINUED) 17 BY MS. FOSTER-STEERS: 18 Q. Good morning, Ms. Tabernacki.19 A. Good morning.20 Q. Yesterday when we left off, we were talking about21 Exhibit C(22), which is a September 8, 2010, e-mail from Craig22 Toll to you. Do you see that?23 A. Yes, I do.24 Q. And we were talking about some responses that were provided25 by Mr. Toll to you. Do you remember?

    FRANCINE C. SALOPEK, OFFICIAL COURT REPORTER(954)769-5657

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  • TABERNACKI - DIRECT/FOSTER-STEERS 5

    1 A. Yes, I do. 2 Q. Okay. So, let me direct your attention, Ms. Tabernacki, to 3 Bate Number 001780 from Exhibit C(22) and ask you, at the last 4 sentence, it says: "As we have discussed with you, the 500 5 home contribution was one way of fulfilling our commitment of 6 about five million." 7 Will you explain to the members of the jury what those 8 500 home -- what that 500 home contribution was? 9 A. Well, as I understood it, InnoVida Holdings was looking to10 make a contribution to Haiti with these homes, and it was going11 to do it through a -- by providing it as a discount through the12 World Vision contract.13 Q. Okay. So, that we can be clear, was the 500 home14 contribution separate and apart from that $5 million equity15 that InnoVida had to provide as a part of the loan from OPIC?16 A. Yes, it was separate.17 Okay. Now, I wanted to direct your attention to Bate 18 Number 001781J. Would you tell the members of the jury -- 19 it talks, about the financial statement -- well, let me 20 read it: "As a place holder, the financial statement for 21 InnoVida Holdings indicate that it has negative operating 22 cash flow. We would like to discuss and understand the 23 causes for the situation. The situation is critical, as it 24 would appear that the parent company would be in default of 25 its financial covenant (sic), precluding us from a further

    FRANCINE C. SALOPEK, OFFICIAL COURT REPORTER(954)769-5657

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  • TABERNACKI - DIRECT/FOSTER-STEERS 6

    1 disbursement." 2 Is that your inquiry to Craig Toll? 3 A. Yes, it was. 4 Q. And would you tell the members of the jury why was it that 5 you were concerned about a negative cash flow of the parent 6 company, InnoVida Holdings? 7 A. Well, as the borrower -- or one of the borrowers in this 8 transaction, to the extent that the major parent company did 9 not have sufficient cash, that would indicate that it did not10 have the cash available to repay the debt. And since the11 project company was clearly not making money at that point in12 time, that would be a very significant concern for us.13 Q. Okay. Would you tell the members of the jury, as we see14 here on this particular page, what is Mr. Toll's response to15 your inquiry?16 A. He said: 17 "We found that the version originally sent to you was 18 not the final one. The final one is attached. Also 19 attached is the calculation of the covenants using the 20 final amounts. We are in compliance with all covenants." 21 Q. Now, attached to that particular e-mail, Ms. Tabernacki,22 was there, in fact, another financial statement provided by23 Craig Toll?24 A. Yes, there was.25 Q. Looking now at Bate Number 001784 from the same exhibit,

    FRANCINE C. SALOPEK, OFFICIAL COURT REPORTER(954)769-5657

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  • TABERNACKI - DIRECT/FOSTER-STEERS 7

    1 C(22), would you tell the members of the jury whether or not 2 there was the statement provided to you by Craig Toll as 3 corrected? 4 A. Yes. This is the March 31st statement. 5 Q. Okay. And at the top, it has "InnoVida Holdings, LLC, 6 consolidated balance sheet, unaudited pro forma." 7 Did that mean anything to you? 8 A. Once again, the unaudited part did. That meant that it was 9 management prepared. Pro forma was -- I did not put stock in10 that.11 Q. Okay. And what is reflected, according to this document,12 with respect to the balance sheets of InnoVida Holdings, LLC?13 A. It appears that the company is growing. Its total assets14 are now at $215 million.15 Q. Okay. And this is just -- is this just for the quarter16 ending March 31, 2010?17 A. Yes, it is.18 Q. Looking now at Bate Number 001786, was this provided to you19 by Craig Toll?20 A. Yes, it was, as an attachment to that e-mail.21 Q. Okay. And now looking at Bate Number 001788, what is this?22 A. This is the income statement showing the revenues and costs23 of InnoVida Holdings.24 Q. Okay. For the quarter ending March 31, 2010.25 A. Yes.

    FRANCINE C. SALOPEK, OFFICIAL COURT REPORTER(954)769-5657

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  • TABERNACKI - DIRECT/FOSTER-STEERS 8

    1 Q. And would you tell the members of the jury, according to 2 this income statement ending March 31, 2010, is InnoVida 3 showing a profit or a loss? 4 A. It is showing a profit for the quarter ending March 31st. 5 Q. And where it has "net income, $1,762,345," is that what is 6 reflected as the net income for InnoVida for the period ending 7 March 31, 2010? 8 A. Yes. On this statement, that's what it's showing. 9 Q. Okay. Were you satisfied with that?10 A. Uhm, no.11 Q. With those numbers?12 A. Well, this was the updated figures. I thought it rather13 odd that one version -- or the first version that I had14 received, uhm, showed net operating cash flow was negative and15 that they didn't have the cash, but for some reason, the new16 final showed that they did have the cash. And now, in this17 version, there was an added covenant that was shown as a18 calculation.19 Q. Now, looking, Ms. Tabernacki, at 001806 -- you recall this20 from yesterday, right?21 A. Yes.22 Q. Okay. And was this an acknowledgment sent to you by Craig23 Toll?24 A. Yes, it was.25 Q. Now, I just want to direct your attention, Ms. Tabernacki,

    FRANCINE C. SALOPEK, OFFICIAL COURT REPORTER(954)769-5657

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  • TABERNACKI - DIRECT/FOSTER-STEERS 9

    1 to the bottom, where it says "sincerely" and then the name 2 "Elba Gamboa, executive manager, InnoVida Factories, Limited." 3 Do you see that? 4 A. Yes, I do. 5 Q. Okay. Did you have occasion to question Mr. Toll regarding 6 the acknowledgments that you were receiving -- or you had 7 received? 8 A. Yes, I did. 9 Q. Okay. And why did you do that?10 A. Because Mr. Toll was the only person -- only finance person11 I ever dealt with at InnoVida. He was the one that was12 familiar with all of these documents, and he's the one that13 provided the explanations as to what these documents contained.14 Q. Okay. Well, did you have any particular concern, though,15 in looking at this particular acknowledgment, as to the16 covenant concerning arm's length transactions?17 A. Yes, it was very concerning, because the parties that are18 showing as acknowledging, I guess receiving and paying, were19 not involved in the transaction from the standpoint of what was20 on the invoice. And then there was a flow of funds through21 other entities that were also unrelated to the transactions.22 Q. Okay. And did you talk with Mr. Toll about that?23 A. Yes, I did.24 Q. Okay. When did you speak to him about that?25 A. I believe it was the beginning -- I'm not sure. I'm not

    FRANCINE C. SALOPEK, OFFICIAL COURT REPORTER(954)769-5657

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  • TABERNACKI - DIRECT/FOSTER-STEERS 10

    1 positive of that date. Sorry. 2 Q. Okay. But you did have a conversation with him. 3 A. Yes, we did. And it was the four of us that were on the 4 phone. It was myself and Cameron Alford, as well as Mr. Toll 5 and Claudio Osorio. If I may, there was one other area of 6 concern on that statement that I pointed out to him. 7 Q. Okay. Go ahead and tell us what -- 8 A. It was with regard to the invoice numbers, since they sent 9 us all three acknowledgments at once, the invoice numbers were10 shown as coming from one entity to the other. And you saw that11 there were changes within that. But yet the invoice numbers,12 the -- one ended in one, one ended in ten, and one ended at 12,13 which indicated that they all came out of the same book.14 Whereas if you have different companies, you're not using,15 well, literally the same checkbook or the same register.16 And also, during the period of time that was covered,17 it showed that there were -- you went from one to 12. So, with18 a $215 million business, you only had 12 invoices issued, which19 seemed very odd to me. And he expressed that he understood my20 concern and that they would do a better job of keeping track of21 the finances.22 Q. Okay. Just let me direct your attention to the second23 invoice, Bate Number 001807. Again, at the bottom, who is24 signing -- purportedly signing this particular document?25 A. Elba Gamboa.

    FRANCINE C. SALOPEK, OFFICIAL COURT REPORTER(954)769-5657

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  • TABERNACKI - DIRECT/FOSTER-STEERS 11

    1 Q. As executive manager for InnoVida Factories, Limited? 2 A. Yes, that's correct. 3 Q. And the third one, Bate Number 001808, who is purportedly 4 signing this document? 5 A. This is also Elba Gamboa. 6 Q. As executive manager of Innovida Factories, Limited? 7 A. Yes. 8 Q. How often were you speaking to Mr. Toll, Ms. Tabernacki, 9 during this period of time?10 A. Regularly, because they were very interested in receiving11 this disbursement. And so, they were pushing us to move ahead,12 and they felt that they had supplied us with sufficient13 information. And they couldn't understand our hesitancy in14 disbursing the remainder of the money.15 MR. SHARPSTEIN: Excuse me, your Honor. I believe16 she's saying some hearsay and not identifying the speaker.17 THE COURT: Sustain.18 BY MS. FOSTER-STEERS: 19 Q. When you say "they," can you identify for the members of20 the jury who is communicating with you?21 A. Oh, I apologize. I would communicate directly with22 Mr. Toll as -- and most of the time, at this point in time,23 given our lack of comfort with the representations that were24 made by the company, I was also on the phone with Cameron25 Alford. And I did have a phone call -- in the beginning of

    FRANCINE C. SALOPEK, OFFICIAL COURT REPORTER(954)769-5657

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  • TABERNACKI - DIRECT/FOSTER-STEERS 12

    1 August, Claudio Osorio called me directly to request the 2 disbursement and had indicated that he was -- he was mobilizing 3 the movement of the factory, and he needed the disbursement 4 immediately, and because I was not available that Friday, he 5 was going to have to call everyone off and stop the shipment. 6 Q. Okay. But with respect to your conversations with 7 Mr. Toll, how often were you speaking with Mr. Toll? 8 A. Oh. Uhm, regularly. I mean I would say that, through 9 communications, either by phone or e-mail, it would be several10 times a week.11 Q. Okay. Looking now at Bate Number 003116, Exhibit C(23).12 And the top of the paragraph, it says: 13 "I also feel bad that we sent an incorrect version of 14 the financials in early August. Then the only significant 15 difference between the incorrect version and the one just 16 sent was an elimination of an intercompany debt and 17 receivable that had not been done on the incorrect 18 version (sic)." 19 Then second paragraph, it says:20 "We are trying to proceed as quickly as possible to 21 erect the factory and produce housing for the people of 22 Haiti. Since we can't proceed without OPIC funding, we 23 want to do whatever we can do to expedite the process. 24 This is the reason we keep requesting perhaps too many 25 calls."

    FRANCINE C. SALOPEK, OFFICIAL COURT REPORTER(954)769-5657

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  • TABERNACKI - DIRECT/FOSTER-STEERS 13

    1 How many calls were you getting from Mr. Toll? 2 A. Uhm, if this -- this was in September, so they were quite 3 frequent. As you can see, they would send a volume of 4 information by this question, and we were expected to digest it 5 in a short period of time. So, I would say that he was 6 attempting to have a call immediately after dumping the data on 7 us, and I kept putting him off so that we would have time. So, 8 I would say, you know, once again, it was probably, you know, 9 twice a week or so that he was seeking a call.10 Q. Okay.11 A. But certainly there were e-mails, as well.12 Q. Okay. Thank you.13 I'm going to show you Ms. Tabernacki what has been14 introduced as Exhibit C(26), which is an e-mail dated15 September 28, 2010, from Craig Toll to you. And under16 number one, it has attached: 17 "June 30th, parent company unaudited financial 18 statements, consisting of balance sheet, income statement, 19 and statement of cash flows." 20 Do you see that?21 A. Yes, I do.22 Q. Was another financial statement provided to OPIC?23 A. (No response)24 Q. And we're looking now at Bate Number 002280. Do you see25 that?

    FRANCINE C. SALOPEK, OFFICIAL COURT REPORTER(954)769-5657

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  • TABERNACKI - DIRECT/FOSTER-STEERS 14

    1 A. Yes, I do. 2 Q. And for this period, it ends June 30, 2010, right? 3 A. Yes. 4 Q. When you look at this particular balance sheet, 5 Ms. Tabernacki, what do you see? 6 A. I see, once again, that the assets are growing of the 7 company, uhm, since March. We're now at $236 million. 8 Q. Okay. How about the combined statement of cash flows? 9 A. Yes. This is shown for InnoVida Holdings for the period10 through June 30th.11 Q. Okay. And in looking at this, what do you see?12 A. Uhm, I also see an increase in cash of another $4 million13 and a positive generation of cash from operating activities of14 $8.1 million.15 Q. Okay. And then if we look at Bate Number ending 002283,16 which is the combined statement of operations, what do you see?17 A. I see a net income of 5.9 million for the period ending18 June 30th.19 Q. That's a profit for InnoVida Holdings.20 A. Yes. Yes, for the parent company.21 Q. Let me go back to the first page, Bate Number 002278 of22 C(26). Referenced in number four: 23 "Corrected acknowledgments, which only change the 24 signature block to InnoVida Holdings, LLC, to minimize 25 reviewer confusion."

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  • TABERNACKI - DIRECT/FOSTER-STEERS 15

    1 Did you get another set of acknowledgments, 2 Ms. Tabernacki? 3 A. Yes, I did. 4 Q. Okay. And the additional acknowledgments that you got, at 5 the bottom of the page -- well, let me go here -- is this an 6 acknowledgment for April 30, 2010? 7 A. Yes, it is. 8 Q. For that $2,080,000, right? 9 A. Yes, it is.10 Q. And for invoice AKY-032410-001 (sic), right?11 A. That's correct.12 Q. Now, at the bottom, what has changed?13 A. That now the signature line is from Elba Gamboa, executive14 manager, this time of InnoVida Holdings.15 This resulted from the original conversation that I16 had had with Mr. Toll expressing my confusion that it was17 saying that the money -- wait -- this letter was... okay. It18 was saying that this was acknowledgment that it had been19 received from InnoVida Holdings, and it was signed by InnoVida20 Holdings. So, it was --21 Q. But before --22 A. Yeah.23 Q. -- Elba Gamboa, do you recall what entity that Elba Gamboa24 had signed as executive manager for?25 A. Yes. It was Innovida Factories.

    FRANCINE C. SALOPEK, OFFICIAL COURT REPORTER(954)769-5657

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  • TABERNACKI - DIRECT/FOSTER-STEERS 16

    1 Q. Was that same change made on all three acknowledgments? 2 A. Yes, it was. 3 Q. We're looking now at Bate Number 0022 -- 2288. Is this the 4 acknowledgment for that $1,689,993? 5 A. Yes, it is. 6 Q. At the bottom, Elba Gamboa is signing now for InnoVida 7 Holdings, LLC, right? 8 A. She is. 9 Q. And then now looking at Bate Number 002289, is this the10 acknowledgment for that amount, $1,929,804?11 A. Yes, that's correct.12 Q. And, again, Elba Gamboa is now signing as executive manager13 for InnoVida Holdings, LLC?14 A. Yes.15 Q. Now, Ms. Tabernacki, did you receive two statements from16 the Royal Bank of Canada?17 A. Yes, I did.18 Q. Okay. From the same exhibit, C(26), I want you to take a19 look at Bate Number 002285. Who sent this to you?20 A. Craig Toll within that --21 Q. And what -- why was it that you were receiving this22 particular document?23 A. Because we had been looking for a third-party confirmation24 of the movement of the funds. And so, he was sending me this25 bank statement as evidence of that.

    FRANCINE C. SALOPEK, OFFICIAL COURT REPORTER(954)769-5657

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  • TABERNACKI - DIRECT/FOSTER-STEERS 17

    1 Q. Okay. Now, I want to draw your attention to the entry 2 under the first column, August 3, 2010, advance on invoice 3 number AKY- -- AKY1-0324 -- I'm sorry -- let me read that 4 again -- AKY1-032410-001. And there's a number of 1,929,804. 5 What is that to represent? 6 A. That's supposed to represent the World Vision payment, as 7 evidenced on that acknowledgment and as evidenced on the 8 pro forma invoice relating to that contract. 9 Q. Okay.10 A. E-mail contract.11 Q. Okay. Now, above that, do you see entries for $6, $6, $6,12 $6, $6, and then an entry for that million dollars?13 A. Yes.14 Q. When you got this, what did you think?15 MR. SHARPSTEIN: Objection to what she thought.16 THE COURT: No, I'm gonna allow it.17 A. Well, I certainly recognized that the numbers agreed, the18 1,929,804. But there were other problems with it in trying to19 reconcile it to the other documentation.20 Q. Okay. What were those problems, Ms. Tabernacki?21 A. One is that this is a Royal Bank of Canada account, whereas22 it was supposed to be deposited in the Wachovia account related23 to the Haiti project. In the acknowledgment, the flow of24 funds, as indicated on there, even if it were appropriate,25 indicated that it was supposed to be deposited in Innovida

    FRANCINE C. SALOPEK, OFFICIAL COURT REPORTER(954)769-5657

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  • TABERNACKI - DIRECT/FOSTER-STEERS 18

    1 Services. We had not heard of this account previously. 2 And, also, the date of August 3rd seemed rather odd 3 considering the other facts surrounding the World Vision 4 e-mail/contract. 5 Q. Okay. And what other facts are you referring to? 6 A. Uhm, the e-mail from Claudio Osorio to Craig Toll, which 7 was the forwarded e-mail from World Vision, was sent to Craig 8 Toll on August 4th. Claudio Osorio had supposedly received 9 that on July 25th. And supposedly this money was to have flown10 through four business accounts, from InnoVida Holdings through11 Southeast, through services, through factories, through12 services, whatever. The point being that for me, if I make a13 deposit in an account, the bank records it the next day. If14 you move it through four accounts, it's unlikely that it would15 show up the same day or the day prior to the date that you know16 about a contract.17 Q. Okay. So, were you suspicious of this?18 A. Very.19 Q. Okay. And were you suspicious of the other --20 MR. SHARPSTEIN: Objection to the form of the21 question.22 THE COURT: Sustain.23 MS. FOSTER-STEERS: Okay.24 BY MS. FOSTER-STEERS: 25 Q. Let's look now at Bate Number 002286, also from

    FRANCINE C. SALOPEK, OFFICIAL COURT REPORTER(954)769-5657

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  • TABERNACKI - DIRECT/FOSTER-STEERS 19

    1 Exhibit C(26). And what is this? 2 A. This also is a bank account screen shot showing that there 3 was a deposit in this Royal Bank of Canada account on 4 July 16th, relating to the invoice number AKY1-032410-010, in 5 the amount of $1,000,689,000,993 (sic). 6 Q. Okay. Now -- and, again, when you received this particular 7 document, what did you think? 8 A. Well, similarly to -- similarly to the previous statement, 9 it did not seem to jive with the other information that we10 were -- we had seen or obtained.11 First of all, similar -- as I said, similar to the12 other problems, we did not know about this Royal Bank of Canada13 account. It was not to reflect the Haiti activities. But more14 importantly, this was -- as given to us, this was to represent15 amounts related to the World Food Program contract/e-mail. But16 with regard to the contract that we saw yesterday, DRC did not17 enter into a contract with World Food until July 23rd. And the18 company did not enter into a contract with DRC to be its19 subcontractor on the World Food Program until August.20 Q. Okay. So, you've now received this information from Craig21 Toll. Is OPIC moving forward with approving a second22 disbursement?23 A. No, we did not.24 Q. In fact, what did you do, Ms. Tabernacki, after you25 received this information?

    FRANCINE C. SALOPEK, OFFICIAL COURT REPORTER(954)769-5657

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  • TABERNACKI - DIRECT/FOSTER-STEERS 20

    1 A. Went to the management of OPIC to let them know what was 2 going on. Uhm, continued to ask questions. 3 MS. FOSTER-STEERS: Let's look at C(28). 4 BY MS. FOSTER-STEERS: 5 Q. Let's go back just one minute, Ms. Tabernacki, to C(26), 6 Bate Number 002285. Do you recognize whose handwriting this 7 is? 8 A. It was similar to what I had seen for Craig Toll, so I 9 assumed --10 MR. SHARPSTEIN: Objection to the form. Move to11 strike.12 THE COURT: Sustain.13 BY MS. FOSTER-STEERS: 14 Q. What does it say?15 A. It should have referenced invoice -012, which was the16 earlier acknowledgment invoice number related to the World17 Vision contract.18 Q. And what does it say? Does it say: 19 "Due to typo in instructions to bank"? 20 A. "To bank."21 Q. Did you think anything of that?22 A. Uhm, at the time? No. I just thought it was, you know,23 one more -- one more error or one more attempt to confuse the24 facts.25 Q. Okay. Let's look now at Exhibit C(28), which is an e-mail

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    1 dated October 5, 2010, from Craig Toll to you. And directing 2 your attention to the bottom of the page, under "one," it says: 3 "Please provide the bank statement relating to the 4 April 30th deposit at Southeast for $2,080,000." 5 Is that your inquiry to Craig Toll? 6 A. Yes, it is. 7 Q. And what is the response that we see from Mr. Toll to you 8 here? 9 A. It says: 10 "The $2,080,000 was transferred in three wires, one 11 for 1.5 million to Services, and two to Southeast for 12 250,000 and 350,000, respectively. The bank statement 13 pages are attached." 14 Q. Okay. Now, Ms. Tabernacki, if we add 1,500,000 to 250,00015 to 350,000, does it add up to 2,080,000?16 A. No, it does not.17 Q. What does it add up to?18 A. It adds up to $2 million -- or two -- no, I'm sorry --19 $2,100,000.20 Q. $2,100,000?21 A. Yes.22 Q. Okay. So, we're off at around $20 million -- I'm sorry --23 $20,000, right?24 A. Yes, correct.25 Q. And let's look at Bate Number 003052. Are these the bank

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    1 statements that were submitted in support of those figures that 2 we just saw? 3 A. Yes, it is. 4 Q. And at the top of the page, there is an account number 5 ending '4270, right? 6 A. Yes, from Wachovia Bank. 7 Q. And what is the name of the company listed here? 8 A. InnoVida Services. 9 Q. Directing your attention to where it has "5-3" -- do you10 see that?11 A. Yes.12 Q. And $1,500,000, funds transfer received from InnoVida13 Holdings, or -- ORG, rather, InnoVida Holdings, Inc.14 Was this one of the entries -- or, rather, the15 deposits into InnoVida Southeast '4270 that was being used as16 support for that -- one of the wires adding up to that17 $2,080,000?18 A. Yes, it was.19 Q. The date 5-3, was that before the invoice or was that after20 the invoice?21 A. That was -- you know, I'm sorry, I'm --22 Q. I can bring it up.23 I'm gonna show you one thing, Ms. Tabernacki, just a24 second.25 A. Oh, yes, that's correct. Okay.

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    1 Q. The $2,080,000 we saw before from C(26). 2 A. Yes. 3 Q. What is the date of that acknowledgment? 4 A. April 30th, indicating that the payment had been received 5 as of that date. 6 Q. On April 30, 2010. 7 A. Yes. 8 Q. And the entry here into InnoVida South -- I'm sorry -- 9 InnoVida Services, what is the date of that?10 A. May 3rd.11 Q. After the acknowledgment --12 A. Yes.13 Q. -- that InnoVida had received payment, right?14 A. Yes, that's correct.15 Q. Now, looking at Bate Number 003053, directing your16 attention to the top of the page, the account number ending17 '9791. Do you see that?18 A. Yes.19 Q. And the company being InnoVida Southeast, LLC, right?20 A. Yes, this is InnoVida Southeast.21 Q. Now, for 5-13, there's an entry of $250,000. Do you see22 that?23 A. Yes, that's correct.24 Q. Was this one of the deposits that was being told to you by25 Craig Toll supported the payment of that $2,080,000?

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    1 A. Yes. 2 Q. And what is the date of that entry? 3 A. May 13th. 4 Q. Is it after the acknowledgment? 5 A. Yes. 6 Q. Looking now at the bottom, 5-25, $350,000, do you see that? 7 A. Yes, I do. 8 Q. Was this also the third wire that Mr. Toll told you was in 9 support of that $2,080,000?10 A. Yes, he did.11 Q. And is it after the acknowledgment that we've looked at?12 A. Yes.13 Q. Now, I want you to look now at Bate Number 003039 from14 Exhibit C(28) under Section B.15 What are you asking of Mr. Toll?16 A. "The invoice, the acknowledgment, and financial17 statements indicate that 2,080,000 in equity funds18 were paid to factories as a deposit of 25 percent of19 the factory equipment. However, the acknowledgment20 further indicates that $2,080,000 was routed to21 Southeast for structural panels. As you know, the22 original intention of the funds was not what23 ultimately" -- oh, I'm sorry -- that's his response.24 Q. Okay. The response -- 25 A. Sorry.

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    1 Q. -- tell us what the response was. 2 A. His response was: 3 "As you know, the original intention of the funds was 4 not what ultimately took place. We sent funds to Services 5 and Southeast expecting to make panels for the houses to be 6 contributed, but this was not approved. The funds then 7 went to vendors of factories to be used for the deposit on 8 the machinery and equipment." 9 Q. What did you think at that time regarding that response,10 Ms. Tabernacki?11 A. Well, first of all, I found it rather annoying, because12 there was a -- this exhibited a habit of writing "as you knew,"13 or "as you know," when, no, that wasn't necessarily the case.14 Things were not represented to me. And if they were15 represented to me, they were shifting explanations.16 Q. Okay. And now looking at the bottom, your inquiry: 17 "In the two additional acknowledgments dated July and 18 August, InnoVida Holdings, LLC, is acknowledging receipt of 19 funds from (itself?), which represents an advance payment 20 of an invoice from Southeast, which is an advance to 21 Southeast." 22 What is Mr. Toll's response to that, Ms. Tabernacki?23 A. He said: 24 "We think the wording could be improved. In different 25 words, InnoVida Holdings is acknowledging that as a payer

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    1 of the funds, it understands that it advanced $1,689,993 to 2 InnoVida Southeast through InnoVida Services. In many 3 cases, InnoVida Services pays invoices on behalf of other 4 companies in the group." 5 Q. Okay. So, is he -- he says here that the monies went 6 through InnoVida Services, right? 7 A. Yes, that's correct. 8 Q. Let's look now at Bate Number 003045. What is this? Tell 9 the members of the jury what this is.10 A. This is, once again, another progress report that is11 required of InnoVida for the quarters and also in support of12 the requested disbursement, I believe.13 Q. And this is a project report ended September 30, 2010,14 right?15 A. Yes, that's correct.16 Q. Now, in the first paragraph, under "summary of progress of17 the project," what does it say with respect to disbursements?18 Here.19 A. Yes, uhm --20 Q. Directing your attention to where it says "between that21 date."22 A. "Between that date and June 30, 2010, there were23 two disbursements, one for $100,000 to OPIC for24 fees" -- which was, by explanation, the amount that25 was deducted before we wired the money -- "and one for

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    1 2,080,000 to Innovida Factories as a deposit on the 2 purchase of machinery and equipment for a factory to 3 be constructed in Haiti. The funds for the advance to 4 InnoVida Factories were attributed to be from equity 5 funds, while the fees were attributed to be from the 6 OPIC advance." 7 Q. Okay. Let me stop you there. 8 "The funds for the advance to InnoVida were attributed 9 to be from the equity funds." 10 Had that changed? Had that explanation changed?11 A. Yes. Because originally, as you recall, the equity funds12 and the OPIC disbursement amount combined were supposed to be13 used for the purposes of shipping the structural panels to14 Haiti. And now, because we were saying, uhm, that our funds15 should not have been used for manufacturing equipment, they16 changed it to, oh, just our equity would be used for the17 manufacturing equipment.18 Q. And, originally, do you recall where Mr. Toll had said that19 $2,080,000 had come from? Was it from OPIC or was it from20 equity?21 A. That was from equity.22 Q. Okay.23 Okay. And in the second paragraph, it talks about24 there's an additional disbursement from the OPIC funds for,25 again, $1,689,993 related to the World Food Project. And then

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    1 the other figure of $1,000,929 -- $1,929,804 relating to the 2 World Vision project. 3 All right. Now, looking at the second page of the 4 progress report, 003046, it talks about in the third paragraph: 5 "Further, we have obtained a commitment for a 6 $3.5 million contract with Royal Caribbean." 7 What was your understanding of what that was? 8 A. We had, once again, understood that that was a contract 9 that they had entered into to build schools and homes for10 teachers, but that was not what OPIC had planned with its11 money.12 Q. Okay.13 A. So, while interesting, it wasn't the proposed use of the14 OPIC funds.15 Q. Now, Ms. Tabernacki, can you tell us, in view of -- do you16 recall this document being received by InnoVida -- I'm sorry --17 from InnoVida to OPIC? How did you view your relationship or18 continued relationship with InnoVida?19 A. During this period, I would say that, uhm, on our side, on20 OPIC's side, we were highly suspicious of the information that21 was being presented to us, which is one reason why we had two22 people on the phone at all times, why we took notes. And I am23 not entirely clear whether they were aware of our concerns.24 But certainly the questions that were being asked of them,25 looking for this detailed information and pointing out

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    1 inaccuracies and inconsistencies and things that just looked 2 fishy, they should have been asking the questions of 3 themselves. 4 MR. SHARPSTEIN: Objection to the form. Move to 5 strike. 6 THE COURT: Sustain. 7 Ignore the last answer. 8 BY MS. FOSTER-STEERS: 9 Q. Now, had you, at this point, Ms. Tabernacki, received any10 audited financial statements?11 A. We had not.12 Q. Okay. Did you ask about those?13 A. We did ask about those.14 Q. Who did you ask?15 A. We asked Mr. Toll. Because during this time period, if you16 recall, we had -- earlier, at the time of the loan agreement,17 we had given them an extension to May 31st, which they had then18 indicated that they couldn't make. And so, they needed more19 time, and they needed to August 31st. Later on, they said they20 needed through September, because they were having trouble21 consolidating the international subs. There were some22 complexities there. Subsequently to that, they said that they23 couldn't do it because it was Ramadan.24 MR. SHARPSTEIN: Objection to the "they" again.25

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    1 BY MS. FOSTER-STEERS: 2 Q. Yes. 3 A. Oh, I'm sorry. 4 Mr. Toll was representing to us that because of 5 Ramadan, they could not prepare the financial statements. 6 Later on in the year, come October or so, Mr. Toll 7 represented to us that because of the litigation that was 8 facing the company from the shareholders, that the litigation 9 would complicate the audit, and they would not be able to do it10 at that time.11 Q. Okay. Let's talk about the litigation.12 What did Mr. Toll tell you about any litigation of --13 or related to InnoVida?14 A. Well, initially nothing. Even though they are required to15 report any litigation to the -- within the -- directed to the16 company to us --17 MR. SHARPSTEIN: Objection. Nonresponsive.18 THE COURT: Overruled.19 A. Okay. So, they were nonresponsive to us in not telling us20 about the litigation. And then, finally, we found out about it21 on our own, and we approached the company and asked them what22 was going on.23 Q. Okay. When you say "we approached the company," who did24 you talk to?25 A. I apologize. We talked to, at that point in time, both

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    1 Craig Toll and Claudio Osorio. 2 Q. Okay. And why is it that you're talking to both Mr. Toll 3 as well as Mr. Osorio? 4 A. Because Mr. Osorio was clearly involved in the litigation. 5 And so, we wanted to talk to them both and understand the 6 perspectives of what was going on from the -- I guess the 7 qualitative perspective of the litigation, and we wanted to 8 speak to Mr. Toll because of the quantitative effects on the 9 company.10 Q. Okay. When you say the "quantitative effects" --11 A. Yes, meaning how it affects the financials of the company,12 what concerns did they have in terms of money that they could13 lose in litigation.14 Q. And what did he tell you?15 MR. SHARPSTEIN: Objection, your Honor, to -- could we16 have a time period of -- some kind of foundation for the17 hearsay?18 THE COURT: Okay.19 A. This in is the period, October and November.20 Q. Of what year?21 A. 2010 -- no -- yeah, 2010.22 Q. All right. Now, you said before that InnoVida was required23 to report litigation to OPIC?24 A. Yes, it was.25 Q. Okay. Where was that contained? Why do you say that

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    1 InnoVida was required to report litigation to OPIC? 2 A. That was one of the provisions of the loan agreement that 3 we had looked at the other day. 4 Q. Okay. And by not reporting to OPIC any litigation, was 5 InnoVida in default of any provision of the loan agreement? 6 MR. SHARPSTEIN: Objection to the form of the 7 question. 8 THE COURT: Overruled. 9 A. They were in default of the loan agreement at that point.10 Q. Now, let's go back to the audited financial statements,11 Ms. Tabernacki.12 A. Um-hum.13 Q. When you were not able to get the audited financial14 statements, what, if anything, did you do?15 A. On November 30th, I called the company's auditors, the16 engagement manager supposedly responsible for the audit of the17 company.18 Q. Okay. Who was that?19 A. Mr. LaMacchia, I believe Tim.20 Q. And in response to -- did you speak with him?21 A. Yes, I did.22 Q. All right. And at the end of that conversation, what did23 you do?24 A. I sent an e-mail to my in-house lawyer telling him this is25 not a drill anymore, because now we were aware -- from my

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    1 conversation, Mr. LaMacchia -- 2 MR. SHARPSTEIN: Objection to the hearsay. 3 THE COURT: I'll allow it for the fact it was said, 4 not the truth of the matter asserted. 5 A. Uhm, Mr. LaMacchia told me that while, indeed, they had 6 been contacted by the company to perform an audit in the 7 spring, there was no ongoing audit. They were not performing 8 an audit at that point in time. 9 Q. Were you concerned?10 A. I was very concerned. We were relying -- we needed to rely11 upon those audited statements, and all of a sudden, even though12 we were -- it was being represented to us all along that there13 was an audit going on, and we were supposed to be waiting for14 it, there was no audit being conducted.15 Q. Now, did you request bank statements of InnoVida?16 A. Yes. At this point in time, given the inconsistencies in17 the acknowledgments and the invoices and the contracts, I asked18 for the bank statements, the complete bank statements of19 InnoVida Holdings, InnoVida Services, InnoVida Southeast, and20 Innovida Factories for every month from the last year.21 Q. The complete bank statements?22 A. Yes.23 Q. Ms. Tabernacki, I want you to look at Exhibit C(37). Do24 you recognize this?25 A. Yes, I do.

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    1 Q. Okay. What is it? 2 A. It's the cover page to the bank statements that were sent 3 to me for the fiscal year 2010, and that's my handwriting 4 saying, where are the statements for Factories. 5 Q. And at the top, what bank statements are these for? 6 A. These are the bank statements for InnoVida Holdings. 7 Q. Looking at Bate Number 003225, at the top of the page has 8 InnoVida Holdings, LLC, for account number ending '8744. Do 9 you see that?10 A. Yes.11 Q. For the period 1-1-2010 through 1-29-2010, right?12 A. Yes.13 Q. What did you get?14 A. On this page or in the package?15 Q. Okay. Well, let me direct your attention --16 A. Okay.17 Q. It says here "account summary, opening balance, 1-01, a18 hundred dollars." Do you see that?19 A. Yes.20 Q. And then it has a total here of $17 as of -- or, rather,21 withdrawals, 1-12, $17. Do you see that?22 A. Yes.23 Q. And then there's another statement, 1-30-2010, right?24 A. Yes.25 Q. And then for the period 2-27-2010, 3-31-2010, it has

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    1 "deposits and other credits." Do you see that? 2 A. Yes. 3 Q. This is now Bate Number 003228. Is there any withdrawal 4 information, Ms. Tabernacki? 5 A. No. This only showed the deposits and other credits. 6 Q. Deposits and other credits for the period -- 7 A. Yes. 8 Q. -- 2-27-2010 through 3-31-2010? 9 A. Right. And --10 Q. And before, the same package, we had seen information11 regarding "other withdrawals and service fees."12 A. Yes.13 Q. Right?14 A. Yes. Bank statements generally provide for deposits and15 withdrawals in order to get to the ending balance.16 Q. And, in fact, if we look at the deposits, in March 31,17 2010, there's a deposit of $1 million coming in from18 GFS Concessions, right?19 A. Yes.20 Q. And then there's, again, the same date, $2 million, funds21 transfer from Christopher Korge, right?22 A. Yes. This is the same page we had seen earlier to23 substantiate the first disbursement.24 Q. But no indication of any withdrawals --25 A. No.

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    1 Q. -- for that money. 2 Look now at the next month, May -- or, rather, 3 April 1, 2010, through April 30, 2010. The information here, 4 "deposits and other credits," correct? 5 A. Yes. 6 Q. And then there's a comment: "Why no detail on the 7 withdrawal?" Whose handwriting is that? 8 A. That's mine. Sorry. 9 Q. Why did you write that?10 A. Because this 3.2 million represents the OPIC funds going11 into the account. And there -- there was no withdrawal12 information contained here on the bank statement to show where13 that money went.14 Q. Okay. Are you concerned?15 A. I'm very concerned.16 Q. Look now at Bate Number 003231 from the same exhibit,17 C(37), for '8744, InnoVida Holdings, LLC. Again, is there any18 information with respect to any withdrawals?19 A. There is no information, but the account summary clearly20 shows that there was $2.3 million withdrawn from the account.21 Q. Okay. And you're -- is this your handwriting?22 A. That's my handwriting.23 Q. "Where did the amounts go?""24 A. Yes.25 Q. And just explain to the members of the jury, what is it

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    1 that you're noting here? 2 A. I believe that on the next page, where the daily balance 3 is. And so, uhm, I was calculating out how much was moving 4 out. And the -- the indications of Southeast to Services were 5 obtained from the other bank statements that I had received at 6 the time. So, I was -- had them all lined up, so I could see 7 that 250,000 went from Holdings to Southeast to Services. 8 Q. Okay. 9 A. And then out (indicating).10 Q. Okay. And when you talk about that $250,000, are you11 talking about the amount referenced by Craig Toll that had12 supported that $2,080,000?13 A. Yes.14 Q. Are you trying to trace the funds, Ms. Tabernacki?15 A. Yes.16 Q. Were you successful with the information provided to you --17 A. No, I was --18 Q. -- by Mr. Toll?19 A. No, I was not, because it didn't have any withdrawal20 information. And so, I was attempting to trace information21 that I didn't have the data available to me to know where it22 went.23 Q. Okay. Looking at Bate Number 003223, for the period24 May 29, 2010, through June 30, 2010, again, for the '874425 account, at the bottom, it has "other withdrawals and service

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    1 fees, $702,063.42." Any details provided as to that? 2 A. As to the withdraws, no. 3 Q. Looking at Bate Number 003235, again, any details? 4 A. Uhm, there is no details on the movement of funds and other 5 withdraws. And if I may, what I noticed from these statements 6 and from the -- these were all sent to me by a hard copy. What 7 I noticed was that these were not just, you know -- it -- these 8 were not put through a copy machine to be sent to me, because 9 this one, for instance, is in the middle of the page, which10 meant that it had been -- oh, excuse me -- it had been moved11 down in order to make the copy. And, clearly, the withdraw12 information wasn't there.13 Q. Okay. Let's look now at Bate Number 003237 from14 Exhibit C(37). And I want to direct your attention to the15 entry 8-11, $500,000.16 When you saw this, Ms. Tabernacki, what did you think?17 A. It took me a minute, but I realized -- you see my18 handwriting, "Where is the $2.5 million deposited earlier?"19 If you recall, they had provided us with evidence from20 this account indicating that there had been $2.5 million21 deposited on August 11th. This was the only entry shown for22 that day.23 Q. Okay. And when you noticed that there was no $2.5 million24 deposit on August 11th into InnoVida Holdings, LLC, account25 number ending '8744, what did you think?

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    1 A. I thought there must be an error, and I went back to the 2 original document that they had sent us showing this deposit. 3 Q. Okay. Do you compare them? 4 A. Yes, I did. 5 Q. Okay. And your comparison revealed what? 6 A. It revealed that for that same day, for that same tracing 7 number, that where it had said 500,000, the earlier copy that I 8 received said that that amount was 2,500,000, designated for 9 8-11 with that tracing number.10 Q. And, again, for that period, are you provided with any11 withdrawal information?12 A. No. This is me attempting to calculate the difference in13 the amounts per day.14 Q. In fact, Ms. Tabernacki, from that first set of bank15 statements provided to you by Craig Toll where you requested16 bank statements, was any withdrawal information provided to you17 after January, 2010?18 MR. SHARPSTEIN: Judge, which ones was she talking19 about? Because there was no testimony that Craig Toll is the20 one that gave her these, C(37).21 THE COURT: You can cross-examine on that.22 Overruled.23 BY MS. FOSTER-STEERS: 24 Q. Ms. Tabernacki, is this what you're referring to? And I'm25 looking at Bate Number 001362 from Exhibit C(18)?

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    1 MS. SELMORE: C(20). 2 MS. FOSTER-STEERS: C(20)? 3 BY MS. FOSTER-STEERS: 4 Q. C(20). 5 A. (No response) 6 Q. Did you understand my question? 7 A. I'm sorry? No. 8 Oh, yes. This is the document that -- that I was 9 referring to. Because this was the amount that was shown as10 the balance and the deposit amount as of that day. If you11 notice it says "funds transfer advice number," and it gives12 that deposit amount for that day.13 Uhm, at this point in time, it also -- well, it shows14 also that it was deposited into this account, '8744. And at15 this point in time, I also, obviously, took a much closer look16 at this document. And I noticed that it had these kind of17 blurry lines across the information. And so, I made the -- I18 made the inference that that could be tape marks related to19 documentation that had been altered.20 Also, pulling out a little bit, if I -- I had even21 gone to the extent of taking a ruler and noticing that the22 lines do not line up exactly. They do seem slightly askew as23 to that amount that had been inserted.24 Q. When you talk about a "funds transfer advice number," can25 you tell the members of the jury, what is this funds advice

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    1 transfer number that you're referring to? 2 A. This is, you know, a tracking number to enable bank 3 information wires to be identified. 4 Q. Okay. And on this particular document, 001362 from 5 Exhibit C(20), is the advice -- funds advice transfer number 6 2010081100051248? 7 A. Yes. 8 Q. And if we look at Bate Number 003237, the bank statement of 9 InnoVida Holdings, account '8744, for the date August 11th, is10 that same advice -- funds transfer advice number the same?11 A. Yes, it is.12 Q. All right. So, after you received these documents,13 Ms. Tabernacki, what did you do?14 A. I asked Mr. Toll for the complete bank information showing15 all of the withdrawals. Also, I had not at that point received16 the bank information, any bank information for Innovida17 Factories. I did receive bank information for a company called18 InnoVida MRD, which we had no dealings with and was not19 reflected in any of our documentations. So, I was unclear as20 to why that was sent to me.21 THE COURT: Ms. Foster-Steers, is this a good spot to22 take a break?23 MS. FOSTER-STEERS: Yes, sir.24 THE COURT: All right, members of the jury, we're25 going to take a 15-minute recess. Remember my admonition not

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    1 to discuss the case or allow it to be discussed in your 2 presence. And we'll see you back in the jury room in 3 15 minutes. 4 COURTROOM SECURITY OFFICER: Please rise for the jury. 5 (The jury exited the courtroom) 6 THE COURT: And, again, Ms. Tabernacki, during the 7 break in your testimony, you're not allowed to discuss your 8 testimony with anyone. And we'll see you back in 15 minutes. 9 THE WITNESS: Okay. Thank you.10 THE COURT: And if there's nothing else to come before11 the Court, we'll be in recess in this case until 15 minutes.12 (Recess taken at 10:10 a.m. until 10:24 a.m.) 13 (The Judge entered the courtroom) 14 THE COURT: Please be seated.15 All right. We're back on the record.16 Counsel are present. Mr. Toll's present.17 I guess we need to get Ms. Tabernacki back.18 Anything to come before the Court while we're waiting19 for her to come in?20 MS. FOSTER-STEERS: No, your Honor.21 MR. SHARPSTEIN: No, your Honor.22 (Pause) 23 THE COURT: Ms. Tabernacki, you understand you're24 still under oath?25 THE WITNESS: Yes, I do.

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    1 THE COURT: All right. Let's bring in the jury. 2 COURTROOM SECURITY OFFICER: Please rise for the jury. 3 (The jury entered the courtroom) 4 THE COURT: Counsel concede the presence of the jury 5 and waive its polling? 6 MS. FOSTER-STEERS: Yes, sir. 7 MR. SHARPSTEIN: Yes, your Honor. 8 THE COURT: And did everyone follow my admonition not 9 to discuss the case or allow it to be discussed in your10 presence?11 THE JURY: Yes.12 THE COURT: All right. I've got a committee meeting13 at lunchtime today. So, we're going to break a little bit14 before noon so I can get to that. And then I have a hearing at15 1:15 that should take a half an hour. So, our lunch break is16 going to be a little longer than normal today, till around17 1:45.18 Tomorrow we'll start at nine, and we'll go to about19 12:30, maybe one o'clock, and then we're not going to be in20 session tomorrow afternoon. And Friday we'll start at nine21 and, again, may have a little longer lunch break on Friday.22 So, that kind of gives you an idea of what to expect23 scheduling-wise the rest of this week.24 Ms. Foster-Steers, you may continue.25 MS. FOSTER-STEERS: Thank you, your Honor.

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    1 BY MS. FOSTER-STEERS: 2 Q. Ms. Tabernacki, before our break, you had said that you 3 requested bank statements, complete bank statements from 4 Mr. Toll, correct? 5 A. Yes. 6 Q. All right. For what organizations? 7 A. Holdings, Southeast, Services, and Factories. 8 Q. Okay. And why did you request those bank statements? 9 A. Because with regard to the acknowledgments and the10 pro formas, those seemed to be the entities involved in these11 transactions.12 Q. And did you get them?13 A. I received them for the three entities -- Holdings,14 Southeast, and Services, but not for Factories at that time.15 Q. Okay. Now, looking at Bate Number 003250, Exhibit C(42),16 is this what you got from Mr. Toll?17 MR. SHARPSTEIN: Objection, from Mr. Toll. There's no18 testimony how she got them.19 MS. FOSTER-STEERS: Okay.20 BY MS. FOSTER-STEERS: 21 Q. Who did you ask, Ms. Tabernacki?22 A. I asked Mr. Toll, and then I received these statements.23 Q. Okay. So, then, let's go back to what these statements are24 for, what entity?25 A. This is for InnoVida Holdings.

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    1 Q. LLC? 2 A. Yes. 3 Q. And if we look at Bate Number 003251, at the top of the 4 page, the account number ends '8744. It has InnoVida 5 Holdings, LLC, correct? 6 A. Yes. 7 Q. And we now see bank statement for the period 1-1-10 through 8 1-29-10. Do you see that? 9 A. Yes.10 Q. Let me show you this first.11 Now, directing your attention, Ms. Tabernacki, to Bate12 Number 003258 from Exhibit 42, what is this?13 A. This is also a bank statement for InnoVida Holdings for the14 month of April.15 Q. And what is reflected here?16 A. The deposits and the withdrawal information for that month.17 Q. And here at the top, 3-28-2010, you see OPIC's monies being18 deposited, correct?19 A. Yes, that's correct.20 Q. And looking now at Bate Number 003260, we have information21 regarding withdrawals and services fees, correct?22 A. Yes.23 Q. For the period May 1, 2010, through May 28, 2010, right?24 A. Yes.25 Q. And it shows, Ms. Tabernacki, on here that a withdrawal of

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    1 $201,900 was made on May 3rd, right? 2 A. Yeah, um-hum. 3 Q. A withdrawal was made on May 3rd of $1,000,500 (sic), 4 right? 5 A. Yes, 500,000, yes. 6 Q. Another withdrawal is made on May 13th of 250,000, and then 7 May 25th, 350,000, correct? 8 A. Yes, that's correct. 9 Q. Now, let's look at Bate Number 003262 for the period10 July 1, 2010, through July 30, 2010. And looking at this,11 Ms. Tabernacki -- let's go back to the pro forma invoice, which12 is from Exhibit C(25), Bate Number 003050. The amount,13 $1,689,993. The invoice dated July 16, 2010. And look at this14 page and then look at the next page and tell the members of the15 jury whether or not you see any amount for $1,689,993 coming16 from this account, '8744, in the month of July, from the17 account '8744.18 A. No, I do not. While there were other withdrawals during19 that period, there was no amount of 1,689,000, roughly, that20 was transferred from the Haiti account.21 Q. And now look at Bate Number 003265, which is the account22 statement for July 31, 2010, through August 31, 2010.23 Again, we see the deposit of $500,000, right?24 A. Yes.25 Q. Let me just make sure I show you -- and then the next page,

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    1 003266, withdrawals, correct? 2 A. Yes. 3 Q. Do you see, Ms. Tabernacki, for the month of August, 2010, 4 from the account ending '8744, any withdrawal in the amount of 5 $1,000,929 -- no, I'm sorry -- yeah, $1,929,804? Do you see 6 that? 7 A. I see it here on the invoice. It was not on -- 8 Q. On the invoice. 9 A. Yes.10 Q. But do you see it on the statement?11 A. I do not.12 Q. Did that concern you?13 A. Yes, because, once again, it had been represented to us14 that the money in the Haiti account was being used for a15 specific purposes (sic) that were being shown on the invoices16 and acknowledged through the other in -- the internal17 documentation that was provided to us. And there was no18 third-party evidence that that money had been removed from the19 account for the purposes that we expected.20 Q. Okay. Just wanted to go back, really quickly, to21 Exhibit C(26), Bate Number 002281, for the period ending22 June 30, 2010, at the bottom, where it has "cash and cash23 equivalents, end of period," there's an amount, $34,803,214.24 Do you see that?25 A. Yes.

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    1 Q. And then for the preceding period, March 31, 2010, and this 2 is Exhibit C(22), Bate Number 001786, cash and cash 3 equivalents, end of period, $39,103,693. 4 From March, 2010, through June 30, 2010, did the 5 amount of cash and cash equivalents increase or decrease? 6 A. This one is -- okay. The first one -- if you could go to 7 the dates. 8 Yes. Between March and June, the amount of cash 9 decreased.10 Q. Okay. Now, did there come a time, Ms. Tabernacki, when11 OPIC issued a default letter?12 A. Yes, we did, in early February.13 Q. Of what year?14 A. 2011.15 Q. And why was it that OPIC decided at that point in time to16 issue a default letter?17 A. Because we understood that the litigation against the18 company was ramping up and that we needed to have our claim19 registered in -- you know, in the local courts.20 Q. What was the basis of that default?21 A. Uhm, at that point in time, we indicated a default22 regarding the inability of the company to provide an audit, as23 well as to not notify us of the litigation associated -- that24 we had become aware of.25 Q. And who did you send that default letter to?

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    1 A. Uhm, frankly, I don't recall off the top of my head. 2 MS. FOSTER-STEERS: Let's look at C(44). 3 BY MS. FOSTER-STEERS: 4 Q. Looking at Exhibit C(44), there is a default letter 5 dated -- sorry -- an e-mail dated February 11, 2011, from 6 Cameron Alford to Claudio Osorio, Craig Toll, and copied to 7 Alfred Smith and Lynn Tabernacki, you, right? 8 A. Yes. 9 Q. That same exhibit, Bate Number 001568, is this a default10 letter?11 A. Yes, it is.12 Q. And the basis of that default is what?13 A. Under (a), it says that the parent company is in default of14 covenant Section 6.06(b) of the loan agreement, which requires15 that the parent company deliver to OPIC, within 90 days after16 the end of each fiscal year, the audited consolidated financial17 statements for the parent company. The amendment number one of18 the loan agreement extended the due date for compliance with19 such covenant until August 31, 2011.20 Q. And were those audited financials ever received from21 InnoVida?22 A. They were never received.23 Q. And then, secondly, in paragraph (b)?24 A. The parent company, in default of the covenant set forth in25 Section 6.08 of the loan agreement, failed to notify OPIC of

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    1 the commencement of any legal or arbitral proceedings against 2 the parent company that involved claims that either 3 individually or in the aggregate at any given time exceed the 4 equivalent of $500,000. And this language mirrors the language 5 that's in the loan agreement. 6 Q. Okay. After issuing this default letter, Ms. Tabernacki, 7 what happened? 8 A. We received a response letter from Alfred Smith indicating 9 that -- essentially, that our default letter was, I guess, for10 lack of a better term, petty and that the defaults were not11 true defaults and that the company was not only gonna fight12 them, but would be willing to take action against us for not --13 would be willing to take action against us.14 MR. SHARPSTEIN: I think all that would be hearsay.15 Is there an exhibit that you're introducing this?16 MS. FOSTER-STEERS: No.17 THE COURT: Sustain.18 MR. SHARPSTEIN: Move to strike all of that.19 THE COURT: Ignore the last answer.20 BY MS. FOSTER-STEERS: 21 Q. Okay.22 A. I believe there was a response from Mr. Alfred --23 MR. SHARPSTEIN: Objection.24 BY MS. FOSTER-STEERS: 25 Q. That's okay.

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    1 Ms. Tabernacki, to your knowledge, when did you cease 2 contacting or interacting or dealing with Craig Toll? 3 MR. SHARPSTEIN: Objection. 4 THE COURT: Overruled. 5 A. Uhm, I believe it was in January, 2011. 6 Q. And this is now Exhibit C(46). What are these? 7 A. (No response) 8 Q. Do you recognize this picture -- photograph, rather? 9 A. It's actually a little blurry.10 Q. Yes, it is.11 Is that better?12 A. Yes. Uhm, these are pictures that Suzanne Etcheverry had13 taken in -- while she was on her site visit -- of the14 earthquake in Haiti and what the homes looked like.15 MR. SHARPSTEIN: Is there a date on that, Judge?16 THE COURT: It's in evidence.17 MS. FOSTER-STEERS: It's already admitted.18 BY MS. FOSTER-STEERS: 19 Q. Looking at Bate Number 003392, what is this?20 A. This is the makeshift cities that the people were living in21 five months after the earthquake.22 MR. SHARPSTEIN: Excuse me, excuse me.23 Objection. No foundation.24 THE COURT: It's in evidence. She can publish it any25 way she wants to. It's already in evidence.

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    1 MR. SHARPSTEIN: But the witness explanation is 2 without foundation. 3 THE COURT: You can cross-examine on it. 4 MR. SHARPSTEIN: She didn't take the pictures. She 5 wasn't there. There's no date. 6 THE COURT: You can cross-examine on all that. 7 BY MS. FOSTER-STEERS: 8 Q. What is this, Ms. Tabernacki? 9 A. This is also a tent city that existed in June of 2010.10 Q. Bate Number 003394, what is this?11 A. This is also a photograph evidencing the state of the12 housing in Haiti at this point in time, five months after.13 Q. Who were these photographs taken by, Ms. Tabernacki?14 A. They were taken by Suzanne Etcheverry and provided to me15 subsequent to her site visit to Haiti.16 Q. And the conditions that we see here in Exhibit C(46), were17 those the conditions that OPIC's monies were --18 MR. SHARPSTEIN: Objection. Objection to the -- this19 question. Objection.20 THE COURT: I haven't heard the whole question yet.21 BY MS. FOSTER-STEERS: 22 Q. Ms. Tabernacki, the conditions that we see evidenced in23 Exhibit C(46), were those the conditions that OPIC's monies24 were designed -- or, rather, to be used to help for the people25 in Haiti?

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    1 A. Yes. The idea was to get people out of tent cities, out of 2 living in plastic, to a shelter that would protect them from 3 the hurricanes and the heat and give them a decent living 4 space. 5 MS. FOSTER-STEERS: I have no further questions, your 6 Honor. 7 THE COURT: Cross-examination. 8 MR. SHARPSTEIN: May I just have a minute to set up? 9 THE COURT: Sure.10 MR. SHARPSTEIN: May it please the Court, members of11 the jury.12 CROSS-EXAMINATION 13 BY MR. SHARPSTEIN: 14 Q. Good afternoon -- or good morning, Ms. Tabernacki.15 A. Good morning.16 Q. You and I have never spoken or talked about the facts of17 this case, have we?18 A. No, we have not.19 Q. On the other hand, you've met with the government on any20 number of occasions to discuss the facts that you've testified21 to and prepare your testimony, isn't that right?22 A. I met with them once previously, and then I met them down23 here just prior to, I guess -- what -- no, we had a phone24 call -- sorry -- last week.25 Q. I mean over the past years, couple of years, you've met

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    1 with them and talked to them on any number of occasions, have 2 you not? 3 A. I have not. Just, as I said, that once. 4 Q. The -- I'm gonna be asking you a lot of questions about the 5 exhibits and the testimony that you've given. But is it fair 6 to say that you're testifying now from your perspective several 7 years later, after your failed relationship with OPIC, from a 8 different perspective than you had back in 2009, when you first 9 met InnoVida and Claudio Osorio?10 A. Well, certainly, we have to look at the entire relationship11 to understand --12 Q. No, the question is --13 MR. SHARPSTEIN: Excuse me, your Honor.14 BY MR. SHARPSTEIN: 15 Q. The question is: You're looking at things from a different16 perspective after you now believe you were defrauded, as17 opposed to then, when you began the relationship, correct?18 A. Of course. Much like a bad marriage.19 Q. Right.20 A. You start in love, and then it all falls apart.21 Q. Exactly. And so, there was love at the beginning, right?22 A. (No response)23 Q. Like a marriage. Right?24 A. I wouldn't say love. I was giving an analogy.25 Q. Well, there was a business relationship that was good at

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    1 the beginning -- 2 A. Yes. 3 Q. -- like under -- 4 A. Yes. 5 Q. -- you know, at the altar in the marriage -- 6 A. Yes. 7 Q. -- and we're all agreeing until death do us part and all of 8 that, right? 9 THE COURT REPORTER: Excuse me.10 THE COURT: You have to talk one at a time, please.11 BY MR. SHARPSTEIN: 12 Q. You know what I mean.13 A. We had a common goal to help the people of Haiti, and,14 therefore, we were aligned.15 Q. And, again, I know what your job was, but the question for16 the jury is: You've looked at a lot of exhibits, you've talked17 in your perspective of what these exhibits looked like now,18 they look a lot different to you now than when you actually19 began your relationship with OPIC, right?20 A. Well, my relationship with OPIC has always been the same.21 Q. I mean your relationship with InnoVida.22 A. Yes. Uhm, not entirely correct, because at the end of our23 relationship, when the suspicions were very high, I looked at24 them in the same way as I'm looking at them now.25 Q. Okay. So, we'll get to that. We're gonna go through it

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    1 slowly. But I want to ask you some questions now, and I'd like 2 to go back to the beginning of your relationship from how you 3 looked at it then. 4 A. Uhm-hum. 5 Q. As opposed to now. 6 A. Uhm-uhm. 7 Q. And we'll get to the present. Okay? 8 A. Uhm-uhm. 9 Q. So, back in 2009, you had been with OPIC for how long?10 A. I guess at that point 14-and-a-half years, almost 15 years.11 Q. So, you had a lot of experience there, correct?12 A. Yes.13 Q. You were in a high-level management position, right?14 A. Uhm, yes.15 Q. And you dealt a lot with similar type of situations --16 private companies coming to you for loans to help in emerging17 countries and things of that nature.18 A. Yes.19 Q. And that was the purpose of OPIC. So that the jury20 understands, when was OPIC created?21 A. As a separate agency of the U.S. government in the early22 '70s, I believe it was around '72.23 Q. '72?24 A. Um-hum.25 Q. President Nixon?

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    1 A. It was actually started under USAID as part of the marshal 2 plan for the reconstruction of Europe. And then we were split 3 out later in the '70s. 4 Q. And the idea was to bring in private business to partner up 5 with government to bring opportunities and business to foreign 6 countries that needed it, correct? 7 A. Yes, but also to help those U.S. companies. 8 Q. Help the? 9 A. To help the U.S. companies grow and expand their businesses10 into those markets.11 Q. Right. Because we're -- this is the U.S., and we're trying12 to help small companies, emerging companies grow and partner up13 and bring business around the world.14 A. Yes.15 Q. That's the idea.16 A. Yes. But we also deal with very larges companies. OPIC is17 able to make loans of anywhere from $1 million up to $25018 million, and by exception up to $400 million.19 Q. So, this is a substantial operation. That's government tax20 money we're talking about here, right?21 A. Yes. But you must be aware that OPIC earns money much like22 a bank does, and we give money back to the U.S. Treasury at the23 end of the year.24 Q. Like, for example, the fees you earn that you talked about,25 the hundred thousand dollar fee from InnoVida to process the

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    1 loan and things of that nature. 2 A. Yes. We earn those fees. 3 Q. The $20,000 retainer you were talking about that didn't 4 come about, but that you were requesting from InnoVida, those 5 kind of things, right? 6 A. Well, the retainer fee is a good-faith fee that somebody is 7 interested and is willing to put up their money to move forward 8 in the due diligence process. 9 Q. But a fee you earn.10 A. Yes.11 Q. So, you're saying that OPIC earns money, as well as gives12 money out.13 A. Yes, correct.14 Q. Now -- so, over that 15 years you were there, there had15 never been a successful relationship with an American company16 in Haiti, isn't that right?17 A. I don't know the answer to that.18 Q. Had you ever loaned money to a company that -- working in19 Haiti to do any kind of business in Haiti?20 A. Me personally?21 Q. To your knowledge.22 A. Me personally? No.23 Q. Do you know whether OPIC did at all?24 A. I would suspect it had, but I don't know for certain.25 Q. You don't know that.

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    1 A. No. 2 Q. There were difficulties in Haiti, correct? Even -- 3 notwithstanding the earthquake, which we'll get to, there was 4 always difficulty dealing with Haiti because of the government 5 and other business type of situations that are very 6 un-American. I'm not trying to say that in any kind of 7 negative way. 8 A. Um-hum. 9 Q. But different than the American system, right?10 A. I would say Haiti is not so different than all of the other11 countries that -- or most of the other countries that we deal12 in.13 Q. But you don't about the relationship with OPIC in Haiti14 prior to you.15 A. No, I don't.16 Q. The -- now, InnoVida was a company that I think, if I heard17 your testimony the other day correctly, that first came to you18 in late 2009.19 A. Correct.20 Q. And was that the first opportunity -- this is when you21 first met anybody from InnoVida, correct?22 A. That's correct.23 Q. But InnoVida had actually reached out to OPIC prior to24 that, isn't that right?25 A. I don't know. They spoke to somebody within OPIC who

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    1 directed them to me, if that's what you're referring to. 2 Q. Well, actually came to OPIC through the White House, isn't 3 that right? 4 A. That I don't know. 5 Q. Do you know anything about a basketball player, Carlos 6 Boozer, and his wife -- oh, they're one of the investors that 7 you saw on the list of investors, correct? 8 A. Yes, they are. But, unfortunately, I didn't know he was a 9 basketball player. They had to tell me.10 Q. He plays for the Chicago Bulls.11 A. Sorry.12 Q. But did you know anything about the fact that he -- someone13 he knew from basketball in college named Reggie Love worked in14 the White House for President Obama?15 A. Actually, I didn't.16 Q. Did you know anything about a meeting that they had in17 early 2009 with the president himself to discuss partnering up18 with OPIC to bring their housing to Haiti?19 A. I never heard that, no.20 Q. Well -- so, when they came to you, you had no understanding21 of the connection between Mr. Osorio and the White House?22 A. No, I didn't.23 Q. No one from the executive office had ever contacted you to24 inquire about them?25 MS. FOSTER-STEERS: Objection. Asked and answered,

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    1 your Honor, and also calls for hearsay. 2 THE COURT: Overruled. 3 A. I was never told anything of that nature by our executive 4 office. 5 What I -- okay. I was never told that by our 6 executive office. 7 Q. Well, there was some contact down the road, which we'll get 8 to, from the executive department of the U.S., right? 9 A. I'm not sure what you're referring to.10 Q. Do you know a woman named Cheryl Mills?11 A. I've heard the name. I might have seen her e-mails before,12 but I'm not familiar with her.13 Q. Cheryl Mills was someone that worked in the White House,14 was a lawyer that worked in the White House, that was put in15 the position to make sure that the operations in Haiti,16 especially after the earthquake, moved along and money got from17 our country to Haiti, aid in coordinating. Did you know her18 then?19 A. Oh, I think you're referring to a Haiti initiative. I was20 not involved in that. This project happened much sooner than21 that initiative started up and, you know, came into OPIC.22 There were others within OPIC, including Suzanne Etcheverry,23 that were involved in that.24 Q. You're -- that you have superiors in your office, correct?25 A. Yes, I do.

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    1 Q. You work for someone. 2 A. Yes, I do. 3 Q. The same way that Mr. Toll worked for Mr. Osorio. 4 A. Yes. 5 Q. You have a certain position, and those people above you are 6 your supervisors, who you owe duties of loyalty and fiduciary 7 duties, as you've called it, correct? 8 A. I do have a supervisor, and I do conduct my job. And he is 9 responsible for reviewing and approving my work.10 Q. Anybody there ever talk to you about -- or give you any11 information about any connection, you know, the White House's12 desire to keep this particular project going or moving faster13 than usual?14 MS. FOSTER-STEERS: Objection. Calls for hearsay,15 your Honor.16 THE COURT: I'll allow it for the fact it was said or17 it wasn't said, not the truth of the matter asserted.18 Overrule.19 A. Your discussion of this and the White House involvement is20 the first that I hear about it.21 Q. Okay. Well -- but there was a lot of White House22 connection between Mr. Osorio and the current White House and23 the prior White House, isn't that right?24 A. Well, Mr. Osorio represented to us his connections to the25 Clinton administration. And people were in it -- within it.

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    1 And he had also told me about connections to Nancy 2 Pelosi, and how he had participated in the -- how he had sat in 3 her box, I guess, for state of the union address or something. 4 Q. There were the pictures you talked about on the wall -- 5 A. Um-hum, yeah. 6 Q. -- in his room. We're gonna get to those in a minute, but 7 it was more than just talk. I mean he was very active with the 8 Clintons, particularly the Bill Clinton Global Initiative. 9 A. Um-hum.10 Q. Right?11 A. That's what he represented to us, yes.12 Q. In Haiti.13 Well, more than just represented to you. It was that14 NGO, the Clinton initiative, that were gonna buy the houses15 that he built, right?16 A. Yes, that's -- well, that's what he represented to us at17 first. And when we were evaluating the loan, he had18 highlighted his relationship with former President Clinton and19 the Clinton Global Initiative. And if you saw in the credit20 paper that I had written, it included a discussion about the21 opportunity for a contract with the Clinton Global Initiative22 to buy those homes.23 Q. The -- well, let's take it -- let's not get too out of24 context here. Let's take it in order of how things went down.25 Mr. Osorio came to you in late -- in the fall of 2009,

    FRANCINE C. SALOPEK, OFFICIAL COURT REPORTER(954)769-5657

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    1 and with him, he had someone named Zach Waksal. 2 A. Yes. 3 Q. Right? 4 You knew Zach Waksal, right? 5 A. That was my first meeting with him -- my first and only 6 meeting with him. 7 Q. Did you know who he was in the company? 8 A. I don't recall if I was provided a title at that time. But 9 my impression from that discussion was that he was a -- you10 know, he would -- he would develop the financial model that we11 needed to evaluate the project.12 Q. You were in touch with him over that period, were you not?13 A. For the period from October through November, when they --14 well, October, when they provided us information, until15 November. And then --16 Q. And do you -- actually, you were helping he and Mr. Toll17 fill out the application that inevitably came for the OPIC18 funds on the ten million, isn't that right?19 A. I recall working with Mr. Toll, because he seemed more20 knowledgeable about the transaction and what was happening. I21 don't recall conversations with Mr. Waksal.22 Q. Now, just so the jury understands, when you are evaluating23 a company, your job is to evaluate the company, the people that24 own the company, the financial stability of the company, and25 things of that nature, correct?

    FRANCINE C. SALOPEK, OFFICIAL COURT REPORTER(954)769-5657

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    1 A. That's correct. 2 Q. Because you're an accountant by trade. 3 A. I'm not an accountant any longer. I was an accountant in 4 my first two years or so as an auditor. 5 Q. You were a schooled and trained -- 6 A. Yes. 7 Q. -- and educated accountant, correct? 8 A. Yes, that's correct. 9 Q. So, your background is in accounting and finance, right?10 A. Yes, correct.11 Q. You worked at Pricewaterhouse, I think you said, for a12 while.13 A. Yes, um-hum, in their corporate finance department.14 Q. So, this initial conversation, this was a presentation that15 Mr. Osorio and Mr. Waksal -- I think you said Mr. Toll was16 there --17 A. No, he was not at that first meeting.18 Q. He was not? So, it was Mr. Waksal and Mr. Osorio?19 A. Yes, it was. And Mr. Waksal didn't say anything,20 Mr. Osorio was just describing in general what the company did,21 presenting his activities and their interest in opening22 factories in these emerging markets and pursuing, you know,23 what role OPIC could play in their activities.24 Q. Did you note -- you learned at some point in time that25 Waksal's father was one of the investors in the company, did

    FRANCINE C. SALOPEK, OFFICIAL COURT REPORTER(954)769-5657

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    1 you not? 2 A. I learned that in January when -- I believe, when they 3 presented us with the shareholding. 4 Q. Okay. And you know who Harlan Waksal is, his father? 5 A. I can't recall who -- what his profession is. 6 Q. Owned a big company called ImClone, prescription meds? 7 A. Yes, now that you say that, that does refresh my memory, 8 but.... 9 Q. The -- so, at that point in time, I think -- didn't you say10 that he came with someone from BGR, Jonathan Mantz?11 A. Yes, he did.12 Q. Now, so the jury understands, BGR is a big lobbyist firm,13 correct?14 A. I guess they are. That would be the term. I didn't know15 that at the time. I thought that they were a government16 liaison consulting firm that was in Washington, D.C.17 Q. A government consulting?18 A. Um-hum.19 Q. And have you had contact with that firm before? Had you20 had contact?21 A. I had not.22 Q. So, the -- and I believe that the discussion then, if --23 and, again, if I say something you don't agree with, just tell24 me -- the discussion was to build a factory in Haiti, 650025 homes per year, having the Clinton Global Initiative buy the

    FRANCINE C. SALOPEK, OFFICIAL COURT REPORTER(954)769-5657

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    1 houses and sell them in Haiti, correct? 2 A. The Clinton -- after that initial period, we did not hear 3 anything else about the Clinton Global Initiative. It was 4 World Vision and World Food, except for one element. And that 5 was, as we were approaching the disbursement, Mr. Osorio was 6 concerned that it wasn't happening fast enough. And so, he 7 told me that Bill Clinton would be calling me, because he was 8 very u