One of the lawyers who represented Stephen A. Saccoccia, a Cranston precious-metals dealer convicted of money-laundering, has agreed to give the U.S. government $245,000 of $750,000 he was paid in attorney fees. Robert D. Luskin was one of five lawyers hired by Saccoccia, whose legal fees totalling $2 million were sought by the U.S. government on the grounds that Saccoccia paid the fees out of drug profits that he had laundered.

JONATHAN D. ROCKOFF Journal-Bulletin Staff Writer

May 10, 1998

PROVIDENCE One of the lawyers who represented Stephen A. Saccoccia, a Cranston precious-metals dealer convicted of money-laundering, has agreed to give the U.S. government $245,000 of $750,000 he was paid in attorney fees. Robert D. Luskin was one of five lawyers hired by Saccoccia, whose legal fees totalling $2 million were sought by the U.S. government on the grounds that Saccoccia paid the fees out of drug profits that he had laundered.

On Friday, Luskin finalized a settlement with U.S. Attorney Sheldon Whitehouse. In exchange for giving up the money, Luskin avoids being held liable as well as having to continue litigation.

Luskin, a Washington, D.C., lawyer, said in a telephone interview yesterday that he had reached the agreement to avoid the costly litigation. And he called the settlement a vindication.

"The relative size of the settlement, compared to what the government demanded, reflects that our arguments were persuasive," Luskin said, noting that $245,000 was less than half what Saccoccia paid him.

But Thomas Connell, a spokesman for the U.S. attorney's office, countered that the sum was actually slightly more than the $489,000 that Luskin netted from Saccoccia's payments, after expenses were deducted.

Dismissing Luskin's claim of vindication, Connell said, "Whether he thinks it's a victory or not, that's for him to consider. I just want to address the facts."

The U.S. attorney's office's quest for legal fees, which continues in the cases of the four other lawyers, followed the conviction of Saccoccia, in 1992, for laundering $136 million in Colombian drug dealers' money.

In 1993, Saccoccia was sentenced to 660 years in federal prison, fined $15.8 million and ordered to forfeit all of the laundered money. His wife, Donna, was sentenced to 14 years for her role in the scheme.

Nevertheless, government lawyers had to continue searching for the money. As part of that effort, they questioned the Saccoccias' lawyers, including Luskin, who testified he received $504,000 in gold bars, the U.S. attorney's office said.

The U.S. Supreme Court has held that lawyers can't be paid with money earned illegally, the U.S. attorney's office contended. That holding was the basis for the suit demanding Luskin forfeit all of his fees.

Yesterday, Luskin argued that he first cleared such payments with the U.S. attorney's office, and took other steps in order to ensure that Saccoccia paid him with money earned legitimately.

Luskin painted himself as the victim, arguing that the government first reneged on their agreement to let him collect the money, then entwined him in costly litigation that he had to pay out of his own pocket.

"They carried the field, captured the combatants and came back to shoot the wounded," he said. Connell declined to respond that point.

Whitehouse's office said that in reaching the settlement, Luskin made no admission of liability. No settlement has been reached with the other four lawyers, federal officials added.

Luskin is a former federal prosecutor best known for his role in policing corruption within the Laborers International Union of North America.

Last month, Luskin began a secret union disciplinary proceeding into whether Arthur A. Coia, general president of the huge union, would keep his $254,000 a year job.

Coia, a Rhode Islander, has been charged by the union with allowing organized-crime figures to influence the union's affairs.

Luskin was hired by Coia in 1994 to create an anti-corruption unit as an alternative to the federal government assuming control of the allegedly mob-influenced union. Luskin is acting as prosecutor in the internal hearings.