Judicial watchdog agency charges Fresno judge linked to Ponzi scheme

By David Kravets, The Associated Press
Friday December 28, 2001

SAN FRANCISCO – A California judicial watchdog agency is charging a Fresno County judge with misconduct in connection with his alleged link to a fraudulent investment scandal. 

The charges, made public Wednesday, accuse James I. Aaron of “willful misconduct in office, conduct prejudicial to the administration of justice that brings the judicial office into disrepute.” 

The allegations from the Commission on Judicial Performance could result in Aaron’s removal from office, but likely will have little impact since he is not seeking a new term when his four-year term expires at the end of 2002. 

According to the commission, the judge, working with three people who were later convicted of investment fraud, induced investors to commit “substantial sums of money” while promising safety and extremely large profits. 

The allegations charge that Aaron knew, or should have known, that the Ponzi scheme was fraudulent while he profited from it and investors lost money. 

The judge’s attorney, Jerome Sapiro Jr., said his client was also a victim of the Ponzi scheme. He said Aaron didn’t know he was touting fraudulent investments. 

“He did not know whether it was legitimate or not,” Sapiro said, adding that the judge told investors to “make up their own minds.” 

The commission also alleged that he solicited $50,000 from a Fresno attorney hearing a case before him. The commission said that, in 1998, the judge summoned a lawyer into his chambers and asked him to invest. 

The judge continued to hear cases involving the attorney, David Mugridge. But Aaron did not disclose on the record to opposing counsel that he was soliciting investments from Mugridge, according to the commission. 

Mugridge did not return phone calls. 

The watchdog agency said that the judge was working with Fresno businessman Kenneth L. Roper, who was sentenced this year to four years imprisonment; Chicago lawyer James M. Baczynski, sentenced to three years, and Debbie S. Alliji, a Fort Lauderdale, Fla., woman sentenced to three years. 

Aaron first was implicated in the scandal last year when the trio were on trial for investment fraud. 

U.S. District Judge Oliver Wanger, who presided over the trio’s trial, declared the fraudulent activity a “classic Ponzi scheme.” Even so, no criminal charges have been levied against Aaron. 

Aaron’s legal troubles began in 1997, when Fresno County sued him for allegedly failing to pay his property taxes. 

Aaron, 59, originally took the bench in 1979. He is required to reply to the charges by Jan. 7.