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Bible required family to follow father's orders, Podluckys say

| Sunday, Feb. 21, 2016, 11:00 p.m.
Brian F. Henry | Tribune-Review
The mansion in Ligonier Township that was being built by former LeNature’s Inc. CEO Gregory Podlucky has more than $800,000 in rare Honduran mahogany, $2 million worth of trim work, seven limestone fireplaces that cost $70,000, six bedrooms and eight bathrooms.

Karla Podlucky and her son, Jesse, both sentenced to federal prison for their roles in the largest business fraud in Western Pennsylvania history, have filed last-ditch appeals based on religious beliefs that they should be subservient to the family patriarch, former LeNature's Inc. CEO Gregory J. Podlucky.

From a federal prison in Yankton, S.D., G. Jesse Podlucky, 35, crafted the “last chance” federal appeal for himself and his mother.

Jesse Podlucky said biblical teachings command them to obey his father, who led the now-defunct Latrobe beverage company into bankruptcy. Gregory Podlucky, 55, is serving a 20-year prison sentence for orchestrating a pyramid scheme that bilked investors out of $629 million.

Karla and Jesse Podlucky were convicted of helping Gregory hide and auction off $2.9 million in diamonds he bought with some of the money he bilked from investors. The proceeds were used to cover his legal bills.

Late last year, Karla Podlucky, 54, gave power of attorney to her son to handle the third and final appeal of her conviction and sentence, according to records filed in U.S. District Court in Pittsburgh. No attorney is listed in court documents.

She was released from custody Jan. 7, having served four years in prison for money laundering. She will be under federal court supervision for three years, records show. Her current address could not be determined.

J. Alan Johnson, U.S. district attorney for Western Pennsylvania from 1981 to 1989, could not recall two convicted members in a family collaborating on an appeal. But he said it's neither improper nor surprising.

“You've heard of jailhouse lawyers before. ... It happens all the time. There are a whole lot of them,” Johnson said. “Post-conviction motions — after the other appeals are unsuccessful — such as this are not a very high percentage, but occasionally they are successful” in overturning convictions or resentencing.

Jesse Podlucky's petition of more than 100 pages was filed in October. In it, he contends his and his mother's prosecutions violated their belief in the literal interpretation of the Bible regarding the father's role in the family.

The family's religious beliefs shielded them from “either learning or believing Gregory Joseph Podlucky's alleged criminal activity,” he wrote.

Podlucky cited Scriptures, including 1 Timothy 3:4, which says, “He must manage his own household well, with all dignity keeping his children submissive.” He also cited Ephesians 5:22, which says, “Wives, submit to your husbands, as to the Lord. For the Husband is the head of the wife, even as Christ is head of the church.”

The petition says the Podluckys are devout Christians, but it mentions no church or denomination. After their daughter, Melissa, died in a traffic accident in 2001, Gregory Podlucky established Missy's Place Foundation with plans to build a $20 million, nondenominational mega church along Route 30 in Ligonier Township.

Maria Erling, professor of modern church history at Gettysburg Seminary and a Lutheran pastor, said the Podluckys apparently chose the verses because a literal interpretation fits their appeal and message. But what the verses might have meant thousands of years ago may not apply today, she said.

“God is the higher authority in this, not the father,” Erling said.

Some Bible verses can apply to a multitude of life situations, she said, but it's important that a person bring his conscience into play, too.

In response to the petition, Assistant U.S. Attorney Robert S. Cessar called the Podluckys' motion “frivolous” and noted that many of the appeal arguments have been rejected twice, first by U.S. Judge Alan Bloch, then by the federal Third Circuit Court.

“Many (of the claims) are demonstratedly frivolous,” Cessar wrote. “That is true of Karla's patently frivolous argument that the Bible somehow absolved her of her conduct ... and Jesse's equally frivolous contention.”

Cessar said Bloch should dismiss the Podluckys' claims that their defense attorneys erred during trial by not calling Gregory Podlucky to testify about his wife and son's roles in the money laundering scheme and in hiding jewels worth millions from government investigators.

His taking the witness stand “would have besmirched the defendants with the taint of (Podlucky's) incredibility, and would have undermined the defense strategy of creating distance from the architect of the scheme,” Cessar wrote.

The Third Circuit Court determined that “the evidence of Karla and Jesse's guilt was overwhelming, palpable and irrefutable,” he said.

Cessar detailed how the family spent ill-gotten money on more than $33 million on gems and jewelry that they stashed in a hidden room, $1 million on toy trains and $11 million on a 24,000-square-foot mansion they claimed was a training center for company employees.

“With LeNature's Inc. bilking banks and investors out of hundreds of millions of dollars, it was ‘a magical time' for Karla,” Cessar wrote. “Beginning in 2000, the family's lifestyle just started changing, the cars they drove got progressively nicer, they flew private jets, and Greg and Karla began acquiring more opulent material possessions.”

Bloch has given G. Jesse and Karla Podlucky until March 11 to reply to Cessar's argument.

Paul Peirce is a Tribune-Review staff writer. He can be reached at 724-850-2860 or ppeirce@tribweb.com.

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