Court filing: Carlos Uresti 'doesn't have money to survive'

Former state senator asking judge to allow him to collect funds

By Nicole Perez - Executive Producer

SAN ANTONIO - A former state senator convicted of fraud and money laundering can't afford to pay his attorney. Now he's telling a judge "he doesn't have money to survive."

Carlos Uresti was convicted in February on nearly a dozen federal charges for a Ponzi scheme, which defrauded investors into giving money to a sand fracking company. Uresti was ordered to repay the victims more than $6.3 million. He was sentenced in June to 12 years in prison. He is free while he appeals the conviction. He is also facing trial later this year on federal charges of bribery.

In the last few months, Uresti has surrendered his license to practice law and resigned his seat in the Texas Senate. A special election has been called for July 31 to name his replacement.

Friday, an attorney for Uresti filed a motion for partial relief from restraining order, claiming Uresti "literally has no liquid funds to pay for normal necessary monthly living expenses, such (as) electricity, food, gasoline and insurance," the document said.

After Uresti was convicted, his wife, Lleanna Margaret, filed for divorce. Federal prosecutors received a restraining order to keep Uresti from selling assets -- something they described as "a common asset protection device."

"Defendants will routinely agree to a final decree in which the non-debtor spouse receives all of the assets while the defendant receives all the debt. In these instances, the purpose of the divorce is largely to avoid the lien that will arise at sentencing ... enabling the government to seek to apply that property to a defendant's restitution debt," prosecutors have said.

The restraining order kept Uresti from being able to sell the law office at 924 McCullough bearing his name unless the judge approved. 

In June, Uresti's attorney said a buyer offered $978,366.60 for the McCullough property and its furniture, court records said. If it's approved, "after payment of any outstanding mortgages, taxes and reasonable costs of the sale, as listed in the closing settlement statement, the remaining funds of approximately $538,264.75 shall be forwarded to the United States Clerk's Office to be deposited into the Court registry pending further order of the Court or for application towards an anticipated restitution judgment," the request said.

The latest court filing said the office building and his home, last appraised for $1.5 million, "still have not sold, and this Court's order prohibits (Uresti) from selling other assets. He doesn't have money to survive."

Also complicated by the restraining order is Uresti's retirement from the Texas Senate. The Texas Employee Retirement System won't send Uresti checks unless it has a court order authorizing payment, the document said.

"Without these retirement checks, Defendant Uresti cannot pay for normal living expenses," the document said.

The existing court order also keeps Uresti and his estranged wife from being able to finalize their divorce, which would also include the ERS monthly income. 

The existing order also keeps Uresti and his estranged wife from being able to receive deposits and write checks, something the request hopes to modify.

Earlier this month, Uresti told the judge he could no longer afford to pay for attorney Michael McCrum, who represented him at trial. He asked the judge to appoint McCrum to represent him in his appeal, but a judge said McCrum was not qualified. Instead, he appointed John Ritenour Jr.

It was McCrum who filed this latest request with the court.

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