His order follows an Aug. 6 hearing in which LeDonne asked him to revoke an initial ruling by Magistrate Judge Christopher Nuechterlein that he should remain jailed without bond after his May 14 arrest on charges of bank fraud, wire fraud and bankruptcy fraud. The government charges that LeDonne accepted down payments, usually equal to 50 percent of the vehicle’s cost, to make fiber-optic splicing vehicles ordered by fiber-optic line contractors throughout the United States and Canada, but he never delivered on the units.
As part of the multi-million dollar fraud scheme, claiming more than 50 victims, LeDonne used a series of bankruptcies to avoid refunding their money, the indictment alleges. He then would create a new company and victimize more prospective customers through the new company, the indictment alleges.
The many business names he used included Level 4 Technologies LLC, L6 Engineering Systems LLC, LG Engineering & Design and most recently, Paragon Technology LLC, operating out of a building at the northwest corner of C.R. 6 and Dexter Drive.
Assistant U.S. attorney Donald Schmid has argued that LeDonne should be detained because he is both a flight risk and an economic danger to the community in that he could perpetrate more scams to steal people’s money. DeGuilio said he doubted there is judicial precedent to justify pretrial detention based on an economic threat, rather than physical threat, but noted he didn’t need to rule on that claim because there was enough evidence to suggest LeDonne was a flight risk.
LeDonne, if convicted, faces up to 17 years in prison. He has shown an ability to raise cash while in jail, having an associate send him $9,000 since his arrest. He had some of that money placed under a mat on his wife’s front door step.
"Additionally, Mr. LeDonne appears to face multiple creditors in this area, which could incentivize him to seek refuge beyond the reach of those creditors,“ DeGuilio wrote.
LeDonne told the judge he missed his five children, who range in age from 6 to 15, and would never flee for that reason alone, and also vowed to stay and fight the charges at trial. Contending that he couldn’t adequately prepare his defense in the complex case while behind bars, proposed that he could be released with electronic monitoring. He asked that he be allowed to report to the St. Joseph County Jail each night, do so at another work release facility, or be allowed to rent an apartment. But the judge found that none of those options would work.
The jail, which contracts with the U.S. Marshal’s Service to house pre-trial detainees, does not allow day-reporting, and neither the marshal’s service nor the court’s Pretrial Services Office has contracts with any state work release programs.
The U.S. Bureau of Prisons does operate a half-way house in Michigan City called the Bradley Center, but the Pretrial Services Office already has an exclusive contract with an electronic monitoring equipment vendor that does not work with the Bradley Center, and the Bureau of Prisons cannot pay for a pretrial detainee to use its location monitoring equipment, the judge wrote in his 8-page order.
LeDonne’s wife Stephanie has sold their $1 million Granger home and filed for divorce, and LeDonne is estranged from his father, children and siblings, the government has said in court.
"The problem here,” DeGuilio wrote, “to which the court sees no current solution, is that there is no reasonably identifiable location to which Mr. LeDonne can be released and from which he can be monitored.”