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Ex-CFO says DHB paid for fine china, MSG luxe seats

Former DHB Industries chief financial officer Dawn Schlegel

Former DHB Industries chief financial officer Dawn Schlegel heads into arraignment in August 2006. She is now testifying for the prosecution in the trial of her former DHB boss David Brooks. Credit: Howard Schnapp, 2006

In her latest testimony as the government's star witness in the fraud trial of her former boss, David Brooks, Dawn Schlegel has detailed schemes the former body armor executive used to generate cash for personal use and other personal expenses he billed to the company.

Schlegel, the former chief financial officer of DHB Industries, testified over the past two days in federal court in Central Islip about a fine-china set worth several hundred thousand dollars and tuition that was paid for Brooks' daughter, Victoria, to attend Emory University in Atlanta.

Wednesday she also spoke of Brooks' luxury box at Madison Square Garden for almost every event -- from the Knicks and Rangers to Madonna -- under questioning by federal prosecutor Christopher Ott.

Brooks and his co-defendant, Sandra Hatfield, the former chief operating officer of his once Westbury-based company, are charged with conspiracy and fraud.

Schlegel has pleaded guilty and has become the government's chief witness in return for the possibility of a lenient sentence.

In addition to the luxury box, Brooks also had his company pay for numerous regular seats for events at the Garden, Schlegel testified. But many of those tickets he personally sold to ticket brokers and pocketed the cash, she said.

Schlegel also testified that Brooks had the company write checks to cash, noting that checks for up to $9,000 were used to pay prostitutes, and checks for $2,500-a-week ostensibly to repay a loan to Brooks' former wife, Terry, were used for pocket money.

Weekly checks were also originally written in the name of the maid at Brooks' Old Westbury mansion and then cashed to generate money to pay the woman, Schlegel said. But when the bank complained that someone other than the maid was signing the checks, Brooks had checks written for cash to generate the money for the maid's weekly salary, Schlegel said.

Schlegel testified that Hatfield also benefited in Brooks' schemes. Hatfield got $600,000 to purchase a condominium in Florida while her son was paid $95,000, ostensibly for legal work, and Hatfield's husband tens of thousands of dollars for consulting work, Schlegel testified. The money was issued at Brooks' orders and Schlegel said she never saw any invoices to support the work.

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