SOUTH FLORIDA — One of the principals in a now infamous Florida Keys real estate criminal fraud case has been granted a new trial, according to a federal appeals court opinion that was extremely critical of the trial judge.

The 11th Circuit Court of Appeals in Atlanta overturned the conviction and 40-year sentence of Cay Clubs Chief Financial Officer David Schwarz on charges of conspiracy and bank fraud.

The appeals court criticized trial Judge Michael Moore for not granting Schwarz requested continuances to postpone the trial in order to give his solo defense attorney more time to research the case and prepare his defense.

“Under the circumstances of this case, the district court’s continuance denials were a clear abuse of its discretion,” the court stated in its opinion. “After subtracting his time spent in other trials and the time period before the government’s first disclosure of discovery materials, Schwarz’s counsel effectively had 12 weeks to prepare to try a complex financial case in which his client was facing decades in prison.”

The government opposed the granting of a continuance longer than 30 days. A motion asking for a roughly three-month continuance was denied without explanation on the same day as it was filed.

Cay Clubs was one of the biggest criminal real estate cases in recent decades in the Florida Keys. Cay Clubs was a major player in the local real estate and resort industry for several years.

Schwarz held a one-third ownership stake in and served as the chief financial officer of Cay Clubs Resorts and Marinas from 2004 to 2007, according to court documents. His business partner, Fred Davis Clark Jr., held a two-thirds ownership interest and served as the chief executive officer.

Their purported goal was to develop multiple amenity-rich luxury resorts and to sell condominium units within those resorts to buyers. The business eventually employed more than 1,000 people, sold more than 1,100 condo units, amassed gross revenues between $700 million to $800 million, and was once estimated to be worth $400 million, but it failed in 2008, according to court records.

In 2015, a jury found Clark guilty of bank fraud, making false statements in connection with federally insured loans and obstructing an official proceeding.

Prosecutors alleged that the conspirators paid the mortgage payments out of Cay Clubs accounts for at least some of the nominee loans. The alleged victims of this fraud included JP Morgan Chase Bank, N.A. and Fifth Third Bank, N.A., according to court documents.

Meanwhile, according to the indictment, Clark and Schwarz were funneling cash out of Cay Clubs for their personal gain, prosecutors charged. Clark and Schwarz attempted to conceal their ill-gotten gains by, among other things, paying Clark’s salary to Cristal Coleman, Clark’s then-girlfriend; by failing to report income from Cay Clubs on their tax returns; and by failing to file tax returns for Clark and Cay Clubs. The government alleged that Schwarz interfered with the administration of internal revenue laws by submitting a W-2 purporting to show wages paid to Cristal Coleman Clark to conceal wages earned by Clark.

A jury found Coleman Clark not guilty on all nine conspiracy and fraud related counts, according to federal court records.

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