Winning Wasn't Everything

Jim Dougherty exposed insurance fraud for Lloyd's of London -- until they concluded the Miami Beach lawyer had overbilled them by millions. Now the U.S. attorney is involved and things have turned very ugly, indeed.

"Dougherty asked us to give him a letter in which we said that Mr. Bilbeisi offered and sold us guns," recalls Vinicio Cerezo, president of Guatemala from 1986 to 1990. "He was even trying to give some members of the government different kinds of gifts. It was not exactly money he offered, but little things like briefcases and clothes. In our system, this is not illegal. But in this case he was trying to convince us to say something untrue."

* Dougherty's acquisition of confidential U.S. Customs documents. Two of the key documents Dougherty brandished in his battle against Bilbeisi were internal memoranda revealing that a Customs agent suspected the Jordanian of smuggling coffee as early as June 1983. One of the possible links between Dougherty and the agency is the regular payments he made to Jean Clarkson, a secretary for Customs's regional regulatory audit office in Miami.

New Times obtained copies of a series of checks from Dougherty to Clarkson, drawn on his professional account from 1987 to 1990. The checks range in value from $250 to $2000 and total more than $10,000. Former Dougherty employees say Clarkson, who has worked for Customs since 1982, used to drop by the office every other weekend; she and Dougherty would spend time in a back room, and then she would leave.

In an interview with New Times, Clarkson initially admitted that she knew Dougherty only vaguely, having worked for him as a pool receptionist in 1981. When told that a number of checks from Dougherty to her were dated years later, she explained that she had done some filing for him last year. "It was just a few months and solely in 1993," she said. When confronted with the existence of checks from previous years, her story changed again. "He would give me gifts," Clarkson said. "But I never supplied him information." In fact, Customs officials say, Clarkson does not have access to the documents Dougherty received.

Why did Dougherty give her gifts? "He liked me," Clarkson explained, adding that on more than one occasion "he would try to touch me. But I made it clear I did not want that kind of relationship." Clarkson later characterized Dougherty's payments as "loans," the word that appears on the memo line of many of the checks. "If I was really behind on my bills, I would ask him if he could loan me some money, and he would," Clarkson said. She does not remember how many checks she received, or when, and she refused to disclose whether she had repaid any of these "loans."

Clarkson has reportedly reiterated to federal investigators that she never gave Dougherty any documents. But she has indicated that someone higher up in the agency could have.

* Dougherty's involvement with Sarkis Soghanalian. One of the more intriguing entries on Dougherty's old office phone lists is the name "Sarkis," which falls under the heading "frequently called numbers." It refers to the notorious Miami-based arms dealer who was convicted in 1991 of smuggling combat helicopters and rocket launchers to Iraq. According to a former Dougherty associate, the two men had regular lunch meetings at Pan Aviation, Soghanalian's air cargo company at Miami International Airport. "Jim used to love to shoot the bull with Sarkis," he says. "He loved when Sarkis told stories, especially about Bilbeisi."

Dougherty's relationship with Soghanalian grew to involve more than casual meals and tall tales. At some point Dougherty provided at least $50,000 to the arms dealer for purposes that remain unclear. Tony Kahter, a long-time Pan Aviation official, says Soghanalian accepted $50,000 from Dougherty as a loan. Soghanalian himself says, "There was $50,000 and more than $50,000." He will not, however, confirm Kahter's characterization of the money as a loan. "I don't owe any response to you," he insists. "I don't have no answer for why he gave me money."

Soghanalian, who was freed from prison last year, acknowledges that he knew Munther Bilbeisi and that Dougherty asked him about the fugitive. But he denies reports from two sources that Dougherty's money was linked in some way to the pursuit of Bilbeisi. "These questions are garbage," Soghanalian declares. "I don't have nothing to do with Dougherty or [Bilbeisi]!"

Whatever the exact nature of the relationship, one obvious question is why Dougherty A who railed to the Senate about penny-ante arms dealer Munther Bilbeisi A would have anything to do with the man the international press dubbed the Merchant of Death, a man whose company has long been linked to gun-running for the CIA.

"At a certain point Jim got led into this netherworld of arms dealers and secret agents and shady characters, and he lost perspective," says one longtime acquaintance. "He became like this wanna-be spook who saw enemies and conspiracies around every corner. He used to tell these wild stories about firefights in Central America. I think he forgot he was an insurance lawyer."

Long before the federal government took an interest in Dougherty's billing practices there were those who felt the lawyer was destined for trouble. Alex Daoud, for one. The former mayor of Miami Beach says he met Dougherty during his terms as a city commissioner. Daoud says Dougherty became especially friendly in 1985, the year Daoud was elected mayor, and the year the city switched to a self-insurance program that required the city attorney to hire private lawyers to defend it when it was sued. Like a lot of people who wanted to be friends with Daoud back then, Dougherty purportedly came bearing gifts.

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