Even after a jury found them guilty, Steve S. Jabar and Deborah C. Bowers declared their innocence.
For months, they argued in court that the core allegation against them – that they stole money intended for a radio station in war-torn Iraq – was misplaced and unproven.
A federal judge agreed this week and set aside their fraud convictions.
In the same decision, the judge found that Jabar and Bowers -- a refugee aid worker and wife of a Clarence minister -- did make false statements to investigators. Those convictions stand.
Unhappy with a partial victory, Jabar said he will appeal the court's decision in hopes of eventually vacating the false statement convictions, as well.
"I want my good name back," he said Thursday. "I want my reputation back."
Setting aside the fraud convictions means Jabar and Bowers face much shorter prison sentences, and might be spared any prison time at all, even if the other convictions stand.
U.S. District Judge Lawrence J. Vilardo's ruling is the latest chapter in a federal prosecution that cast a spotlight on Jabar, an Iraqi native and former high-level U.S. military adviser, and his efforts to build a radio station for women in Iraq.
After a three-week trial last year, a jury found Jabar and Bowers guilty of diverting $65,000 in United Nations funds to pay off personal loans, credit cards and property taxes.
The money was earmarked for Radio Al Mahaba, the self-described “voice of women” in Iraq. More than a decade later, the radio station, a forum for women eager to talk about divorce, careers and religion, is still broadcasting.
In setting aside the fraud convictions, Vilardo said the government never proved that Jabar and Bowers intended to harm the U.N.
"As is so often the case, the cover-up here was worse than the acts that were covered up," Vilardo said in his ruling.
Federal prosecutors may also appeal the decision and on Thursday said they will wait until after sentencing to weigh their options.
During the trial, prosecutors said the U.N.’s $350,000 grant was intended for Opportunities for Kids International, a nonprofit group formed by Jabar and Bowers, with the ultimate goal of financing the radio station.
The problem, they told the jury, is that on the day after the grant arrived in OKI’s account, $20,000 was withdrawn and spent on personal expenses. Prosecutors claim Jabar owed money to friends and was experiencing serious financial problems.
Shorty after the jury verdict, Jabar and Bowers filed a motion to dismiss their convictions or grant them a new trial.
They claim the jury didn’t hear enough about their “good faith defense.” They claim the U.N. money they are accused of stealing was reimbursement for money they had personally invested in the radio station.
In short, they suggest, they are guilty of only one thing – poor bookkeeping.
"We will definitely appeal," said Mark J. Mahoney, Bowers' defense attorney. "If she had been tried on only the false statement charges, she would have been acquitted."
Patrick J. Brown, Jabar's defense lawyer, said his client in disappointed in the court's decision to let the false statement convictions stand.
"We're certainly thankful the court ruled the way it did as far as the wire fraud convictions are concerned," he said.
In their motion to dismiss the convictions, Jabar and Bowers also raised questions about the roots of the government’s investigation and suggested that a hidden agenda led to their criminal prosecution.
They point to an FBI memo in 2006 linking OKI, the nonprofit group, with al-Qaida, and a separate series of emails that same year indicating agents were preparing to “pick up Jabar, blindfold him, and take him” to an FBI site for questioning.
Three years later, according to another document, investigators pointed to a likely grand jury indictment of Jabar to suggest that the new charges would allow them “to neutralize Jabar and possibly assist in gaining his cooperation.”
Defense lawyers say the effort to “get” Jabar also included placing him on the Terrorist Watch List.