“Kim hated her so much,” Sandy said. “She just wanted to stomp on it and tear it apart.”
The McLaughlins tried once more to explain to Nanette that they would give her the Infiniti, which was in Las Vegas, if she would please return the Cadillac, per Bill’s living will. Yet, she still continued to ignore their pleas.
After evading police for weeks, Nanette finally agreed to take a polygraph test on January 5, 1995. Although she tested as truthful when she answered “no” to the question “Did you shoot Bill McLaughlin?” she came up as deceptive when she responded with “no” to these three questions:
“Do you know for sure who shot Bill McLaughlin?”
“Do you know for sure where the gun is that was used to shoot Bill McLaughlin?”
“Did you participate in any way in shooting Bill McLaughlin?”
She said she’d never said anything to Eric that would have made him want to kill Bill, but she thought that Kevin and some of his buddies could have committed the murder.
She made an excuse that she had to pick up her kids and couldn’t stay for the follow-up interview after the polygraph. When she came back the next day, she was told that her initial test came up as deceptive and said she didn’t want to complete the process. Eric refused to take the test from the start.
In an interview on January 6, Nanette said she felt guilty for giving out so many keys to workers around the house, including gardeners, painters, housecleaners, and such. The detectives asked if she stood to gain anything from Bill’s death, and she said no. She stood to gain more if he’d lived, because that way they could carry out the business deals they’d been working on together. She noted that although the life insurance policy would give her $1 million, she would have gained $10 million in royalties if she’d married him.
Bill was everything to her, she said, contending that he’d known about Eric being a friend who did things with her that Bill didn’t like to do. She said she knew Eric wasn’t involved in the murder, because he didn’t even know where Bill lived. She started out saying they were just friends who hung out during the day, and besides, Eric had a girlfriend. But later in the interview, she admitted that Eric was a lover—just not someone she could settle down with, and certainly not a marriage partner. She didn’t love him that way, she said, and she assumed the feeling was mutual.
She said Eric came to the Seashore house after the break-in to install an alarm, and was planning to put in a better one soon. Police later learned that there was never an alarm in that house.
The detectives asked if Eric had ever shown Nanette any paperwork where he’d handwritten the license plate number for Bill’s Mercedes, and she said no. Asked why he would have the number if she’d never shown him the car, her response was “I don’t know.” She claimed that she never told him exactly where she lived, and that all she’d bought him for Christmas was a pair of sweats.
Detective Voth told Nanette that they had more incriminating information showing that Eric had killed Bill, but they couldn’t tell her about it, because Eric might run if he found out. Voth said he hoped Eric hadn’t asked her for any money.
Nanette said he hadn’t. “I don’t have any anyway. Well, some, but . . . ,” she said, trailing off.
This revealing statement was only a hint of what the McLaughlin family and the NBPD were about to uncover.
Around this same time, Kevin McLaughlin confronted Nanette directly at Balboa Coves one day when she was gathering some of her belongings. Later he recounted the scene to his girlfriend, Sandy.
“Did you have my dad killed?” he asked.
“Nooooooo,” Nanette replied, acting shocked.
This was no laughing matter, but Sandy got a kick out of the story. Kevin’s speech difficulties could cause a lack of normal inflection, so he really had to put a lot of effort into doing voices and imitations. She was also proud of him for confronting Nanette.
The police were still interested in what Kevin had to say about the murder, given that he was a witness and had been in the house when Bill was shot. However, he had little substantive information to offer. He told them that although Bill had talked about marrying Nanette, he shared a private joke with Kevin that he was going to “dump” her when she turned thirty.
On January 13, Kim McLaughlin called Detective Voth to let him know that the family had decided to put up a $40,000 reward for information leading to the arrest and conviction of suspects in Bill’s murder.
Five days later, Kim told Voth that she and Jenny had been going over her father’s accounts, trying to get a handle on what bills and taxes needed to be paid, and had discovered some disturbing irregularities.
“We were trying to get things to Brian [Ringler], our accountant, and we couldn’t get things paid and we couldn’t get things done, and things weren’t clear,” Kim said.
But when Kim and Jenny tried to question Nanette about these issues, she’d been strangely uncooperative and evasive.
“As things would come up, we would ask her questions about ‘Do you know this person?’ or ‘Do you know about this situation? Can you enlighten us?’” Jenny recalled, but Nanette didn’t return calls or follow through when she said she would get back to them.
Nanette simply didn’t seem to understand—or refused to—that although she was a trustee of Bill’s estate, she wasn’t in complete control of or entitled to all his money. Jenny and Kim were very suspicious.
The bank statements from November 1994 showed a balance of $650,303 in Bill’s U.S. Funds W.F.M. Holdings account, which was titled with his initials, as were several other accounts and properties. This was his biggest account, which received about $550,000 in Plasmacell-C royalties each quarter.
The McLaughlin trust was set up for asset protection and estate-planning purposes, with a PriMerit Bank account as the operating fund. For asset protection purposes, Bill couldn’t sign on that account, so he made Nanette a managing trustee in November 1991. Ringler was a cotrustee, but only Nanette was authorized to sign and issue checks to pay the household bills and take care of small-scale financial matters. Kim was the successor managing trustee in line, who would take over if Bill should die.
The royalties went into the trust account, and then were transferred by the bank to the W.F.M. Holdings account, on which only Bill had signing power. But once he died, Nanette, as his estate trustee, could go down to the bank and stop that transfer of funds.
“We were extremely concerned,” Kim said.
The family asked Nanette for three months of bank statements, but she said she couldn’t find the one from December, so they had to ask U.S. Funds for it, while Ringler did cash flow projections to keep the estate going and pay outstanding bills. They were worried to see a check for $30,000 had already cleared in January.
When the missing statement finally came in the mail, Kim made an even more disturbing discovery: Line items for a $250,000 check that had cleared four days after Bill’s death and for a $75,000 check written in early December.
She immediately called Jenny. “I found it,” Kim said. “I found some evidence that she’s stealing from us.”
Brian Ringler asked to see a copy of the actual $250,000 check so he could try to figure out what was going on. Once he received it, he saw that check #1158, paid to the Nanette Johnston Trust, appeared to have been signed by William F. McLaughlin on December 14, the day before his murder, when he had been in Las Vegas. Endorsed by Nanette, the check cleared on December 19, two days after the police allowed her and the McLaughlin family back into the house. The money was deposited into Nanette’s First Interstate Bank account.
Why would Bill have paid his girlfriend such a large sum, especially when he’d been complaining of an increasing inability to pay his bills of late? The simple answer, Ringler thought, was that he wouldn’t have.
“He was always very methodical, had great credit,” Ringler said. “He never would have [spent] a quarter million dollars while he was having all these problems.”
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The next questions: Were there more checks like this one? And was there money moving between Bill’s other accounts as well?
From there, Ringler and the family asked for statements from a half-dozen accounts, going back to 1993. When they couldn’t get them by simple request from Nanette or the bank, they asked for the police department’s help, which was subpoenaing records as well.
As soon as Detective Hartford heard about the $250,000 check, he asked Ringler to forward copies of all Bill’s canceled checks from the past three months.
Ringler soon calculated that Nanette had written $125,000 in checks from another one of Bill’s accounts shortly after his death, placed that money into the PriMerit trust account, then proceeded to spend at least $80,000 of it. (This was the household account that generally had a balance of $10,000 to $20,000.)
Upon closer inspection of the checks, they also found multiple credit card payments that went to Bill’s various accounts, but to Nanette’s credit cards as well. Nanette had chalked up at least $24,000 in charges to Bill’s credit cards by signing as Nanette McLaughlin—both before and after his death.
Ringler went back through the handwritten ledger to 1992, where he saw that Bill had been paying Nanette $1,000 each month as an allowance. Once Ringler had the checks in hand, he compared the amounts on the documents with the amounts Nanette had entered into the ledger, and also with the amounts she’d entered into a computer Quicken register, which served as the official accounting record for the year.
He saw nothing of note in 1992 and 1993. However, starting in February 1994, he began to find discrepancies. Checks written for $3,000 and $5,000 were entered into the computer register for only $1,000, or sums were voided out entirely, meaning that she was taking thousands more dollars each month than her allowance. By October 1994, those amounts jumped significantly on multiple checks totaling $47,000.
A fax from U.S. Funds showed that between November 17 and December 14, 1994, six checks totaling $611,096 and signed by William F. McLaughlin had cleared. Two of those checks, totaling $105,000, were made payable to Bill’s PriMerit trust account.
As Ringler tracked the money, he could see that sums were flying between accounts, with Bill appearing to have signed off on the transfers. However, these transfers continued after his death between accounts Nanette was allowed to access, but also between those she was not. Subsequent statements showed that the balance of the W.F.M. Holdings account had dropped from the $650,303 to only $40,000 by January, then to a pitiful $10,788.
Other discrepancies turned up as well. Checks were written out to Nanette, and yet the official register listed another entity, such as contributions to World View. There were also what appeared to be some legitimate payouts for Bill’s property investments, such as three checks totaling about $256,000, which went to Rancho Mirage Associates, Salomon International Investment, Co., and W.F.M. Hacienda, L.P.
One questionable check for $11,000, written on the W.F.M. Hacienda account, dated December 12, 1994, was cashed on January 5, 1995, by Nanette. It was made out to her, and allegedly signed by Bill. Nanette was not authorized to sign checks on that account.
Ringler turned over all of these documents and his analysis to the NBPD, which then forwarded the stack of canceled checks to its documents expert, Detective Charles Beswick. Comparing the signatures to those found on other documents, Beswick determined that Nanette had forged Bill’s signature on the $250,000 check, as well as on checks from the W.F.M. Holdings and W.F.M. Hacienda accounts. Everything else was taken out of his trust account once he died, as she wrote checks to herself and paid her credit card bills.
By the time Ringler finished his calculations, he’d identified $341,000 worth of checks that Nanette appeared to have stolen from Bill’s various accounts. He and the McLaughlin family decided they should remove Nanette as trustee before she could do any more harm. In addition to the amount she stole, Ringler suspected that Nanette may also have been counting on getting paid $5,000 a month for her work as an estate trustee.
By this point, Captain James Jacobs, of the NBPD, had decided to separate the McLaughlin investigation into two parts, assigning Detective Hartford to lead the financial-fraud aspect and having Detective Voth continue as lead investigator on the homicide.
After serving a number of search warrants for Nanette’s bank records, computers, and other financial documents, Hartford’s team found more discrepancies and raised the amount stolen to nearly $500,000, figuring they probably hadn’t even found all of the illegal transactions.
Meanwhile, Nanette, who continued to claim that Bill’s Cadillac was hers, had Barry Bernstein, her attorney, fax Kim’s attorney a DMV certificate of title. The title showed that Bill had signed the car over to Nanette on July 3, 1994. However, upon closer examination, Detective Beswick determined that Nanette had forged this signature as well.
Apparently, the diamond promise of being married to Bill someday had not satisfied Nanette’s need for short-term gratification. She’d been spending this stolen cash on luxury items for herself, dinners out, and gifts for her boyfriends. And she continued to spend Bill’s money after his death.
On January 9, 1995, Nanette paid for her and Eric Naposki to join Club Met-Rx for three months. After that, she told the manager, they would be leaving the area.
CHAPTER 12
As the detectives began looking into Nanette’s background, a pattern began to emerge: Eric was the latest in a series of men younger than Bill, whom she’d met at the gym and slept with behind Bill’s back.
On December 17, 1994, while looking through police reports associated with the victim and his friends and family, the detectives found a report that listed Glenn Sharp as Nanette’s “boyfriend” and a witness to a traffic collision involving Nanette two and a half years earlier in Costa Mesa.
In an interview with Detective Hartford at Sharp’s home in Mission Viejo on December 28, 1994, Sharp said he’d met Nanette at the Sports Connection juice bar in April 1992. They struck up a conversation and started dating a week later, in between a week-long ski trip she took to Mammoth with her boss, Bill McLaughlin.
Nanette said she and her kids were living full-time with Bill, but her relationship with him was all business. Bill was often away, she said, traveling to Palm Springs and Palm Desert to work on his development projects.
“I was under the impression that she was working for him, doing his books or whatever,” Sharp said.
Before meeting Bill on the bike path with some friends, she said, she’d been living on the peninsula, making good money working for a medical-supply company. Sharp never understood how she came to live and work at Bill’s house, but she made it sound like she needed to be at his beck and call. It was just easier for them this way.
Sharp worked as a firefighter, and she called him at the station when Bill was out of town. He got the idea pretty quickly about their no-strings arrangement, which suited him just fine as a single man in his late twenties going through a divorce and seeing a number of women.
Still, Nanette had some strange rules: She could call him, but he was not allowed to call her. They had sex in the Balboa Coves house, but he was not to go upstairs. She took Sharp to the house on Seashore Drive as well, but their rendezvous had to be prearranged—and only when Bill was out of town.
“It was really a shaky deal,” he said.
There was also a more serious problem. “She had a hot temper. She could be violent at times,” he said. “That was one of the reasons why I finally had to break it off with her.... She tried to run me over twice with her automobile.”
A couple of months after they met, they had an evening that raised some concerns. It was a Monday night, May 19, when Bill was away, so she and Sharp went out to dinner and listened to some jazz. They drank their fill of alcohol, he said, then started driving south to Newport on the 55 freeway. Sharp was in his car and Nanette was in her brand-new 1991 red convertible Infiniti M30.
“She decided t
hat she wanted to race me,” he recalled. She took off, and Sharp tried to catch up and get her to slow down, but driving faster than one hundred miles per hour got to be too much for him. He slowed down at Victoria, near where the highway ended. That’s when Nanette lost control of her car, spun out, and crashed, taking out a gas pump at a Union 76 station and totaling the Infiniti.
“I thought, for sure, it killed her,” he said.
A bystander called 911, which brought out the police and fire departments, and an ambulance took her to the emergency room.
When a police officer told her to pee in a cup and warned that she might have to go to jail, “she pitched a fit,” Sharp said. After being arrested on suspicion of driving under the influence, she was released to Sharp.
“That accident was never reported to Bill the way it really happened,” he said. “She swept it under the rug, kept him in the dark about her activities.” Bill was simply told that Nanette got into an accident and broke her nose.
“Would you call her a player?” Hartford asked.
“Definitely a player, yeah,” Sharp said. “She liked the life in the fast lane. She liked the money and she liked to spend it.”
Nanette told Sharp that Bill was paying her six figures. Based upon her incredible wardrobe and collection of accessories, Sharp believed it. She had to be “bringing in money from somewhere.”
Nanette was quite a talker, aiming to impress, and it worked on Sharp. She boasted that she had a potential deal going with hair care mogul Paul Mitchell, with whom she said she was meeting in Beverly Hills. She had “something to do with some fandangled brush and comb” that had just come out in Europe, which she was trying to peddle to Mitchell. On top of that, she had an idea for a pet-grooming supply business. She bragged that she had some Hollywood connections as well, saying that when she and Bill went out to the desert, they had dinner at Frank Sinatra’s house.
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