Ex-Bonniville Pacific Director Cuts Plea Deal Dunlop's Testimony May Pull Other Principals Into Breach

Salt Lake Tribune 04/09/1993
By Ted Cilwick

A former Bonneville Pacific managing director, John T. Dunlop, has agreed to cooperate with federal prosecutors, His testimony could shed light on the role of company founders and principals, including Salt Lake City Mayor Deedee Corradini. Mr. Dunlop's plea bargain - to furnish records and sworn testimony in exchange for leniency for three felonies lodged against him Thursday - is important because he was a central figure in the now-bankrupt company's operations. All of the company's principals may have reaped handsome profits from the diversion of millions of dollars from Bonneville Pacific shareholders, according to bankruptcy examiner Alan Funk's voluminous report made public last year. Mr. Dunlop's testimony could refute Ms. Corradini's claim that she knew nothing about any of the company's questionable transactions involving Sallah International, the Panama-based company that was controlled personally by Mr. Dunlop. Ms. Corradini, a Sallah shareholder, received interest-only loans from Sallah to finance her Federal Heights home, investigators found. When the mayor refinanced the house in December 1992, the proceeds --$255,000-were deposited in a Sallah account. Later, that account was frozen by U.S. Bankruptcy Judge John Allen until it becomes clear who own those proceeds. Ms. Corradini Thursday continued to voice optimism she will be cleared of wrongdoing. Details of Mr. Dunlop's plea bargain with federal authorities emerged with the unsealing of insider trading, tax evasion and false-statement charges against him. As part of the deal, Mr. Dunlop will plead guilty to the charges next week, said defense lawyer James McConkie. "We expect there will be jail time," said Mr. McConkie about prosecutors' commitment to help limit Mr. Dunlop's sentence. Prosecutor Stewart Walz refused to comment. Mr. Dunlop is cooperating because "he wanted to take responsibility for his acts" and help authorities recover as much money for spurned shareholders as possible, Mr. McConkie said. Richard Burbridge, attorney for other principals involved in the Bonneville-Pacific case - Robert Wood, L.Wynn Johnson and Raymond Hixson - declined to discuss the effect of the Dunlop deal. The charges accuse Mr. Dunlop of insider trading Bonneville Pacific stock and helping a consultant file a false tax return.