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Starry Night Murder revisited: Hundreds of thousands of dollars was found in Larry Hurwitz's car during California drug bust

PMG PHOTO: JAIME VALDEZ - Documents generated reporting on Larry Hurwitz include a photo of Tim Moreau (top) around the time he moved to Portland and a mug shot of Hurwitz (bottom) when he was charged with the killing.

When convicted Portland murderer Larry Hurwitz was arrested on drug and money charges in California on June 27, he made a startling admission.

Hurwitz denied knowing anything about the 4.4 pounds of cocaine found in the car he was driving to the Huntington Beach police officer who pulled him over. But he claimed the $328,000 in cash stuffed in two grocery bags was his — and that he'd had it since the 1990s, when he pulled it out of a local Merrill Lynch account.

In fact, Hurwitz repeatedly has denied under oath having any substantial assets since being imprisoned in 1998 for killing Tim Moreau in one of Portland's most high-profile homicides, known as the Starry Night Murder. He owes the IRS hundreds of thousands of dollars in unpaid taxes and fines, and has paid very little toward a $3 million civil settlement to Moreau's parents, Mike and Penny Moreau, for the death of their son.

Mike and Penny Moreau say they were not surprised to learn Hurwitz had been arrested for such serious crimes — or that he claimed to have so much money that he has never disclosed.

"When you look at his whole history, he never reformed at all," Penny told the Portland Tribune.

Mike said the arrest has reenergized their commitment to hold Hurwitz fully accountable for the murder of their son. They are registering their Oregon civil judgment in Orange County Superior Court, where Hurwitz will be tried, to claim as much of the cash as possible.

"It would be a concrete way to know that we are effective in holding him accountable for the murder of our son," said Mike, explaining that Hurwitz only recently began making payments of just $225 per quarter toward the settlement.

In the arrest report, police in California said they believe the cash was drug profits, and it was subsequently seized by the Department of Homeland Security.

But the police and department do not know that Hurwitz actually had a Merrill Lynch account that contained hundreds of thousands of dollars in the late 1980s and 1990s in Portland — and that he was convicted of not reporting hundreds of thousands of dollars to the IRS in April 1998 before being convicted of Moreau's murder in August 2000.

FACEBOOK - An undated picture of Larry Hurwitz before his most recent arrest from his Facebook page.

Reporter becomes part of story

At the time of the killing, Hurwitz owned the Starry Night rock club and Moreau worked as his promotions manager. Hurwitz killed Moreau on Jan. 23, 1990, to cover up his own role in a counterfeit ticket scandal at the club. Hurwitz was convicted of the killing — and admitted he did it — 10 years later. But Moreau's body has never been found.

Details of the Merrill Lynch account were first revealed when Hurwitz sued Willamette Week newspaper and this reporter for libel for a June 20, 1990, story tying him to the disappearance of Moreau. During the discovery phase of the case, attorneys obtained monthly statements of the account. It was opened in January 1987 and averaged between $49,000 and $128,000 over the next five years of frequent deposits and withdrawals.

Hurwitz did not report the money to the IRS at the time because he did not file taxes for 1987 through 1990. He only submitted the tax forms for those years after filing the libel suit to prove the story damaged him financially. The tax forms were incomplete, however, and provided no documentation on the sources of his income. They claimed he actually made very little money those years — just $5,181 in 1987; $6,061 in 1988; $6,212 in 1989; and $4,800 in 1990.

The lawsuit was dismissed in June 1992 and Hurwitz subsequently moved to Seattle and Vietnam. Then, in late 1997, Portland police raided a local gold and silver dealer suspected of receiving stolen property. The dealer had heard about the problems with Hurwitz's tax returns and offered to cut a deal with the Multnomah County District Attorney's Office.

In exchange for a reduced sentence, the dealer revealed that Hurwitz had bought nearly $10,000 worth of silver from him in 1990 — when Hurwitz claimed he was making less than minimum wage.

More than that, the dealer knew other local gold and silver dealers who had sold Hurwitz large quantities of silver at that time. The police turned the information over to the IRS, which tracked down all of the dealers and determined that Hurwitz bought approximately $420,000 worth of silver between 1987 and 1990.

Hurwitz was indicted on four counts of federal income tax evasion on Feb. 19, 1997. According to the indictment, Hurwitz failed to report $37,387 in taxable income in 1987; $32,321 in 1988; $16,902 in 1989; and $333,513 in 1990. The indictment did not say what had become of the silver.

Hurwitz was in Vietnam at the time and refused to return to be arraigned on the charges. A warrant was issued for his arrest in May 1997, but Vietnam does not have an extradition treaty with the United States, and Hurwitz still refused to return to face the charges.

Then, in November 1997, the U.S. State Department revoked Hurwitz's passport and he was deported in the custody of the U.S. Marshal's Service, who escorted him to Portland, where he was arrested on the tax evasion charges and lodged in the Multnomah County Justice Center jail.

On April 22, 1998, Hurwitz cut a deal. He pleaded guilty to one count of income tax evasion in exchange for a one-year prison sentence. After Hurwitz began serving his sentence, sources who knew about his involvement in the murder began talking to the authorities.

Hurwitz was indicted on five counts of aggravated murder on Nov. 20, 1998. He pleaded no contest to the charges on Aug. 21, 2000, and was sentenced to 12 years in prison.

The Moreaus then filed a civil lawsuit for wrongful death against Hurwitz. He settled it for $3 million on Dec. 11, 2001. In the agreement, Hurwitz admitted that he killed their son to cover up a financial scandal at Starry Night, which is now the Roseland Theater. The agreement also said the Moreaus could go to court in any state to seize his assets and future earnings.

Where did cash come from?

Hurwitz never admitted having substantial assets until his most recent arrest.

For starters, Michael Morey, the Moreau family's original attorney, grilled Hurwitz about his finances in a court-ordered debtors examination on Feb. 23, 2004. At the time, Hurwitz was about halfway through his sentence for the killing.

The Portland Tribune has heard a tape recording of the interview, which was conducted at the Two Rivers Correctional Institution. In it, Hurwitz repeatedly denies having any money or assets at all.

But when asked what happened to the silver, he becomes evasive. He says it originally was moved to a safety-deposit box in Seattle, but claims that he cannot remember the name of the bank. Hurwitz then says he sold the silver at a loss to men in California.

When asked their names and how he met them, Hurwitz says he never knew their names and cannot remember how he met them. Hurwitz suggested that he only got about $80,000 for around $160,000 worth of silver.

Morey clearly did not believe Hurwitz, calling his story "suspicious."

Erin Olson, the Moreaus' current attorney, compelled Hurwitz to respond to a written set of questions about his finances in March 2011, approximately three years after he was released after serving just eight years in prison. Hurwitz said he was unemployed and had no assets beyond unemployment benefits and a used 1997 Dodge van. When asked how he intends to pay the Moreaus the money he owes them, he wrote, "I can't."

When he was stopped in Huntington Beach on June 27, Hurwitz originally said the money belonged to a Salem-based company called Magnus Productions, which was employing him. But after being arrested, he told another officer in a follow-up interview that the money was his from the 1980s and 1990s. At the time, the police thought the total was $350,000, not the $328,000 he was subsequently charged with possessing.

As stated in the report, "HURWITZ told me he spent a decade between 1980-1990 saving money in order to eventually have the $350,000 that was in possession. ... After saving the cash, HURWITZ said he invested it into a Merrill Lynch account and later withdrew its entirety between 1989-1990. HURWITZ advised that he did not have any documentation to support that claim, but that he could possibly find it. Since approximately 1990, HURWITZ said he has had the $350,000 in cash in his possession.

Hurwitz also said he has been using the money to supplement his income and pay his bills and expenses, wrote the officer, who said the cash was more likely drug profits.

Hurwitz is still in jail in California. A pre-trial hearing is scheduled for Sept. 9. Oregon has filed an arrest warrant for Hurwitz because he is on post-release supervision and left the state without permission.

Learn more

You can read previous stories about the murder and tax case here.

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