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Slatkin Is Taken Into Custody for Questioning


Reed E. Slatkin, the money manager to Hollywood luminaries who admitted to having lost $255million during a 15-year fraud spree, was taken into custody in federal court in Los Angeles on Thursday to await months of questioning by investigators.

The co-founder of EarthLink Inc. agreed last month to plead guilty to 15 counts of fraud, money laundering and conspiracy. He returns to court Monday to enter his plea to charges carrying a potential sentence of as many as 15 years.

Slatkin, 53, of Santa Barbara, will try to win a lesser sentence by helping prosecutors and bankruptcy lawyers seeking to identify additional assets and defendants.

Slatkin's attorney, Brian Sun, said his client is eager to cooperate. An attorney for a creditors committee, Richard Wynne, said he hopes to begin distributing "significant" amounts of recovered funds to investors by the end of the year.

One unusual provision of Slatkin's plea agreement allows him to request a lighter sentence because of the "psychological impact of his association with certain individuals and/or groups," a reference to his long involvement in Scientology.

A Church of Scientology statement said Slatkin was excommunicated because he "abused his position of trust to prey on his fellow members of the church." Slatkin hasn't been a practicing minister in any Scientologist church since 1983, the statement said.

Slatkin sat motionless, in an open-collared white shirt and sport coat, his eyes downcast, until U.S. Magistrate Rosalyn M. Chapman called him forward. She asked if he realized he was signing away his rights.

"Yes, your honor," Slatkin murmured, barely audible.

She denied Slatkin's request to take his pain and blood-pressure medications to the Metropolitan Detention Center, saying a prison doctor would prescribe appropriate drugs.

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