Zellene Laney, P.I. Properties' former bookkeeper, testified emotionally yesterday that she treated her appearances before a federal grand jury investigating allegations of fraud at the firm in a cavalier fashion because she felt prosecutors "were out to turn black leaders into something bad."
Laney, one of the government's key witnesses at the fraud and conspiracy trial of Mary Treadwell, president of the defunct P.I. Properties firm, said she considered Treadwell to be "one of our top leaders" and "did not want to tell investigators anything about Mary.
"I felt like I was betraying a trust in telling investigators what we did up at Clifton Terrace," Laney, 37, said of the dilapidated Northwest Washington apartment complex that was owned by P.I. Properties and allegedly used by Treadwell to defraud the federal government and low-income tenants of thousands of dollars to enrich herself.
John W. Nields, Treadwell's court-appointed defense attorney, attempted to discredit Laney's testimony for the prosecution by showing that she did not take the investigation seriously. Laney, concluding nearly 12 hours of testimony over 4 days, readily conceded she "did not consider it important" when she testified before the grand jury that eventually indicted Treadwell.
"I may be wrong," Laney said, "but I did not want to be involved."
The former P.I. Properties bookkeeper said that as she testified before the grand jury she "was not trying to remember" many of the details of the case.
Treadwell, clearly angered by the testimony, told reporters during a recess in the case, "Now you know why the grand jury system should be changed."
Laney also conceded that contrary to her courtroom testimony earlier this week, she wrote in a June 1981 statement to prosecutors that Treadwell directly ordered her to alter P.I. Properties' financial records to make it appear that Clifton Terrace was losing money each month.
Laney testified during the trial that P.I. Properties' general manager, Robert E. Lee, told her that Treadwell wanted the records fixed to show monthly losses.
"I may have written Mary and meant Bob," Laney heatedly told Nields. "I was thinking Mary or Bob because they are the bosses. The facts are still the same. I can't change the facts."
Laney told the federal court jury of eight women and four men hearing the case against Treadwell that she reluctantly continued to cooperate with prosecutors in the case because she felt she did not have a choice. She later told reporters that she felt she could have been prosecuted herself if she had refused.
The former bookkeeper said she continued to grant interviews to two Washington Post reporters investigating the P.I. Properties' operation only because "they kept harassing my mother and I didn't want them to keep harassing my mother."
In other testimony yesterday, Revardo C. Pretlow, a former Internal Revenue Service field officer, said that P.I. Properties officials hired him in 1975 to advise them on how they could garner "the best tax advantage" from the purported losses that the nonprofit firm was incurring at Clifton Terrace.
But Pretlow testified that P.I. Properties officials declined to give him enough financial information so that he could give them proper advice. He said P.I. Properties paid him for his expenses but refused to pay him for work he did over a seven-month period.