By Matt Coker
By R. Scott Moxley
By Charles Lam
By Nick Schou
By Gustavo Arellano
By Gustavo Arellano
By Steve Lowery
By R. Scott Moxley
But when the issue came up at trial, Allen clammed up. He said he couldn't bring any supporting witnesses to his own defense, that describing his 1963 mission in Vietnam would, 37 years later, endanger other agents. For more than two years, Allen and his attorney, Ted Albert, had asserted they would offer irrefutable proof of the military heroism. It never came. Instead, in early 2000, creditors attorney William Kennon brought to trial a string of top-ranking CIA and military officials and agents. Each participated in the missions Eddie claimed were his; each denounced Eddie in unvarnished terms. "If he [Eddie] did what he claims, I would have known about it," says Air Force Brigadier General Harry C. Aderholt, a colorful CIA officer and fighter pilot who served in World War II, Korea and Vietnam. "I told the judge that Allen was a lying son of a bitch who has no conscience. He should be court-martialed."
Eddie insisted Aderholt and the others were lying. He told federal judge Robert Alberts he could name men who would verify his participation in top-secret Vietnam missions but only in a session closed to the public. A tape of that April 2000 session since unsealed reveals that Allen's allegedly top-secret names were widely available in books one can find on the shelves of any Barnes & Noble.
Immediately after that disastrous session, citing a disagreement with his client, Allen's attorney dropped the case.
Allen then turned to Irvine attorney Jeanne M. Rowzee. She may be a very good lawyer; it's clear Rowzee is a smart businesswoman. Court documents in the matter of Allen vs. Rowzee show that attorney and client worked out a deal to fund Rowzee's work in the bankruptcy case—a deal involving the house at 21 Carmel Bay.
Eddie found M&G Property Management, a Bellflower firm willing to float Jo Ellen a $100,000 loan for litigation. In exchange, the Allens would offer as collateral Jo Ellen's house. It's hard to imagine why M&G would gamble on a couple with the Allens' record of bad debt, bankruptcy and stiffed landlords or why it would accept as collateral a home already entangled in loans to myriad other lenders, including Southern California Edison Credit Union and Washington Mutual Bank. Several phone calls to M&G went unanswered.
But this much is clear: on Oct. 24, 2000, Jo Ellen executed a note for $100,000 secured by the home at 21 Carmel Bay. Following an agreement drafted and signed by Eddie, M&G's cash went directly to Rowzee; following that same agreement, Rowzee cut Jo Ellen a check for $25,000 with the understanding that those funds were reserved for litigation.
For the last two months of 2000, the sun smiled upon the Rowzee-Allen-M&G relationship. Eddie sent his $1,000 December payment to M&G with a note: "Thank you for your help."
But in January, court documents show, the relationship soured. Eddie and Jo Ellen stopped paying M&G, and Eddie introduced a new interpretation of his financial arrangements with Rowzee. In a Jan. 26, 2001, memo to the lawyer, Eddie wrote that Rowzee should deposit $75,000 in unspent funds from the M&G loan to "our bank account and [allow the Allens to] pay you as required."
That same day, Rowzee fired back in a manner that shows she understood Eddie Allen too well. "For reasons that are too numerous to go into here, the funds for your legal representation should NOT at any time be in your bank account," Rowzee wrote. "Moreover, I am requesting at this time an accounting of the $25,000 transferred to you that was earmarked for expenses in this case: from my perspective, I fear that funds have long ago been spent on expenses unrelated to this case. For instance, the trip to Thailand that you claimed so desperately to need."
Their harsh January 2001 exchange set the tone for the Allen-Rowzee relationship. A month later, the trial phase of Eddie's bankruptcy case wrapped up. Seven months after that, on Sept. 6, the judge issued his stinging rebuke: "This court finds that Allen was not a colonel in the U.S. Air Force; he was not shot down, captured and held prisoner during the war in Southeast Asia; he is not a Harvard-educated attorney or, for that matter, an attorney at all; and he was not the very successful, wealthy and astute businessman portrayed. Plaintiffs justifiably relied upon such misrepresentations when investing."
Because of his fraudulent presentations, the judge said, Eddie was "not entitled to the economic fresh start afforded to honest debtors under the [bankruptcy] code." Eddie owed creditors $1.5 million in that case alone. Two additional Eddie Allen corporate bankruptcies are being litigated now.
Sept. 6 was a dark day for Eddie and Jo Ellen. On the day the judge issued his blistering conclusion, the Newport Beach-Costa Mesa Daily Pilot ran a legal advertisement in which M&G fulfilled its legal obligation to give the Allens more bad news: "YOU ARE IN DEFAULT UNDER A DEED OF TRUST. . . . UNLESS YOU TAKE ACTION TO PROTECT YOUR PROPERTY, IT MAY BE SOLD AT A PUBLIC SALE." Three weeks later, M&G pushed the house at 21 Carmel Bay into a foreclosure sale. A day after that, on Sept. 28, M&G won the deed to the house.