PROSSER COURT DOCUMENTS: Former U.S. Attorney David Nissman Accused of Influence Peddling, Outright Lies and Taking Part In A Criminal Conspiracy In ICC Bankruptcy Case
To take over Jeffrey Prosser’s Innovative Communications Corporation (ICC) the National Rural Utilities Cooperative Finance Corporation (RTFC/CFC) needed a rogue operator who could hold public hearings on all three Virgin Islands in less than 45 days.
But the RTFC/CFC needed someone who could set fair play, objectivity and honesty aside in the interests of putting the cooperative’s needs to take over ICC first — while at the same time having some credibility with the people of the territory.
This rogue operator would be paid handsomely for his efforts — including signing his name to a report he admitted that he had assistance in drafting — and falsely accusing Prosser of stealing $20 million from the VITELCO retirement fund. (VITELCO did not have its own retirement plan but was instead part of the ICC retirement plan).
According to court documents, the man’s name is former acting U.S. Attorney for the Virgin Islands — David Marshall Nissman.
About a year after public hearings on the court-ordered hostile takeover, accused influence peddler Nissman would again prove invaluable to Christie’s Inc. and RTFC/CFC in allegedly coercing the Virgin Islands Police Department (VIPD) to abruptly end an investigation into who sabotaged the wine cooling system at Prosser’s Shoys residence in St. Croix in 2011, court documents indicate.
The former federal prosecutor intervened with V.I. Attorney General Vincent Frazier, Assistant V.I. Attorney General Carol Thomas-Jacobs, former Police Commissioner Henry White and former St. Croix Police Chief Chris Howell to squelch the investigation into $600,000 of ruined wine — for which the Prossers were ultimately fined nearly $1 million.
Under the direction of Frazier, the new Virgin Islands Public Services Commission (PSC) hearings examiner, Nissman was hired to do a “rate review” of what might happen as far as Virgin Islands ratepayers were concerned if the RTFC/CFC took over VITELCO. Federal prosecutors are supposed to hold themselves to a higher ethical standard — but apparently this one never got the memo.
Although he had no professional experience in regulated utility rate making (he is actually an environmental disaster attorney by area of expertise), the PSC charged Nissman with the responsibility of producing a 60-page report on the future of ICC under the RTFC/CFC and with holding public hearings on St. Thomas, St. Croix and St. John — within 45 days.
For his efforts, Nissman would be paid the agreed-upon amount of $100,000 — despite the fact that he later admitted he only co-authored the report — he kept all the money paid to him.
U.S. Bankruptcy Court Judge Judith “Judy” Fitzgerald was anxiously awaiting Nissman’s report and Attorney Nissman knew she was waiting for it. In it, Fitzgerald had advance warning that the former U.S. Attorney would be accusing Prosser of stealing $20 million from the VITELCO Pension Plan.
Coming from a former federal prosecutor in good standing — Nissman knew that the accusation would be taken very seriously by the court — and difficult to disprove on a tight time deadline — no matter how untrue. The report provided former Judge Fitzgerald all the “information” she needed to approve transfer to CFC/RTFC and provide the support for her dismissal of any representation by Prosser as not credible.
However, once the public hearings began, it became clear that they could have easily taken place in Castro’s Cuba or Putin’s Russia because only one side would be allowed to testify — those in favor of the transfer of ICC to RTFC/CFC. Prosser’s representatives were quickly judged to be persons of “no standing” and would not be allowed to voice their opinions and expertise.
Frazier tagged Nissman and made him the PSC hearing examiner for purposes of the report and hearings.
Innovative and its predecessor VITELCO had spent at least $200 million in upgrading the telecommunications technology and supporting infrastructure since 1985, but the long, distinguished record of that service — including bouncing back from Hurricanes Hugo, Marilyn, Bertha, Georges and Lenny — would not be a part of the public record during the public hearings. In order to make it clear as far as Frazier and RTFC/CFC were concerned — there was only one choice — and one direction to take.
“The Hearing Examiner (Nissman), in conjunction with the testimony of VITELCO Expert Witness David) Blessing, (Alvarez and Marsal St. Croix operations coordinator) Byron Smyl and PSC Expert Witness David Parcell, takes judicial notice that the U.S. and world economies are continuing to decline and difficult economic conditions are certain to increase,” Nissman wrote. “Debt financing is becoming increasingly more expensive and scarce. Equity investors recognize that they are in a buyer’s market and look for more significant returns than a utility company is likely to generate.”
In other words, Nissman was saying that ICC needed to go bigger — or go home — and he and RTFC/CFC and the Virgin Islands government already had the fix in: it was time for Prosser to go home.
“It is inconceivable that the misappropriation of the $20 million from the employees’ pension fund, allegedly by prior management, will not be subject of a separate criminal investigation and the Hearing Examiner recommends that VITELCO, the PSC, and the Trustee coordinate their efforts to cooperate with any such investigations that may be under way,” Nissman wrote. “On this point and many others where misappropriation and illegal diversion of assets is being claimed, there can be complicated issues concerning restitution.”
However no criminal investigation followed because the facts were clear there was no misappropriation of pension funds and former Judge Fitzgerald’s weightiest opinion against Prosser was overturned by U.S. District Court Judge Curtis Gomez on St. Thomas.
Ultimately, even the PSC which had hired the former federal prosecutor as the hearing examiner for utility rates (under the direction of Frazier) ignored the criminal prosecutorial predictions for Prosser by Nissman, including the U.S. Department of Justice, the Virgin Islands Department of Justice, the Pension Guaranty Trust Fund and the Virgin Islands Public Services Commission (PSC) — they all totally ignored Nissman’s allegations — because they deemed that they had no merit.
After first being approved by the Federal Communications Commission (FCC) and the U.S. Department of Justice, the PSC gave its approval to RTFC/CFC to takeover Innovative Communications Corporation (ICC) and Judge Fitzgerald gave tentative approval to the Rural Telephone Finance Cooperative-Cooperative Finance Corporation to purchase ICC and all of its assets in April of 2010.
In 2009, Prosser himself filed defamation lawsuit against Nissman in the Superior Court of the Virgin Islands seeking unspecified “damages” from the former U.S. Attorney for falsely claiming that he had stolen $20 million from the utility’s pension plan. Superior Court Judge Harold Willocks has been assigned the case. No court decision has been reached as of the date of this report.