State attorney general won't appeal dismissal of Krolicki case

LAS VEGAS - Nevada Attorney General Catherine Cortez Masto said Thursday she won't appeal a judge's dismissal of a criminal case accusing Lt. Gov. Brian Krolicki and his top aide of misappropriating funds from a state college savings program.

Masto said she disagreed with Clark County District Court Judge Valerie Adair's decision Monday to cancel next week's trial and throw out the case based on what Masto termed "a technicality."

"The judge merely found the charging document, the indictment, was deficient," said Masto, a Democrat who drew fire from defense attorneys for what they called a political prosecution of an elected Republican state official and his chief of staff, Kathryn Besser.

Krolicki and Besser were accused of mishandling about $6 million of a $3 billion program when Krolicki was state treasurer. The four-count felony indictment alleged that crimes had been committed over five years before being discovered in a 2007 audit.

Adair's written ruling faulted the document for never saying which funds were used, which transactions were wrong and what duty Krolicki was accused of violating.

Lawyers for Krolicki and Besser denied any wrongdoing by their clients and derided Masto's assertion that the case hinged on a technicality.

Prosecutors "could never articulate or agree on what, if anything, Brian Krolicki and Kathryn Besser ever did wrong," said Besser's attorney, Lidia Stiglich. "That's not a technicality. It's the barest level of competency we should expect from an attorney general."

Masto didn't apologize for bringing the case and denied Thursday that politics spurred the prosecution. She noted that Adair didn't find the case lacked merit or that the state lacked sufficient evidence.

Masto said a statute of limitations prevented her from seeking a new indictment and that as attorney general, she decided it wasn't in the best interest of the state to appeal to the Nevada Supreme Court.

"My office has reached the goal I set for them," she said, "shining a light on an elected official who misused the powers of his office."

Masto focused Thursday on $1.5 million she said was "concealed" and diverted to a private marketing firm to promote Krolicki's image with the savings program. Prosecutors never contended that Krolicki or Besser converted state funds to their own use.

Krolicki attorneys Richard Wright and Margaret Stanish said they would have showed a jury that the case amounted to a misunderstanding about how funds entrusted to the treasurer were supposed to be handled.

"After 13 months, I finally agree with Catherine Cortez Masto's judgment and her conclusion that it is not in the best interest of the state to proceed with this case," Wright said.

The defense had accused Masto of using the indictment to sink Krolicki's chances of challenging Senate Majority Leader Harry Reid in next year's election. Reid aides deny that claim.

Krolicki has said he'll seek re-election next year.