Tag Archives: corruption

FBI, TBI raid Rutherford sheriff’s office in corruption investigation

MURFREESBORO, Tenn. (AP) — The Tennessee Bureau of Investigation and FBI have executed search warrants at the Rutherford County Sheriff’s Office and the sheriff’s home.

TBI spokesman Josh DeVine said in a statement on Thursday that the warrants are part of an ongoing investigation into possible public corruption involving multiple targets within the sheriff’s department.

DeVine said he couldn’t discuss specifics because of the continuing investigation.

Last month, the TBI confirmed it was looking into connections between Rutherford County Sheriff Robert Arnold and his family members who own companies that sell electronic cigarettes and snacks to inmates at the county jail.

Further from the Daily News Journal:

The FBI also confirmed the agency is conducting a search in Marietta, Georgia, related to this case.

JailCigs is based in Marietta, according to Georgia state records. Arnold’s aunt and uncle, John and Judy Vanderveer, are listed as owners of the company. Chief Deputy of Administration and Finance Joe Russell is also listed as an owner of the company, according to records on the Georgia secretary of state’s website.

Russell was placed on administrative leave with pay in late April after District Attorney General Jennings Jones asked for an investigation into the company’s dealings with Rutherford County Jail. Arnold has since suspended that contract.

The home of Chief Deputy of Administration Joe Russell was also searched on Thursday morning, Niland said.

TBI and FBI officials arrived at the Sheriff’s Office at 6:30 a.m. to start serving the warrants, Niland said.

Investigators remained on the scene hours later carrying bags out of the office on New Salem Highway.

Richard Beeler, informant in 1980s ‘Rocky Top’ corruption probe, dies in apparent suicide

Former Knox County law director Richard Beeler, an informant in the FBI’s Rocky Top investigation of the 1980s, died of an apparent suicide Thursday, reports the News Sentinel.

Beeler, 57, was law director from 1990 to 2000. Sheriff’s officers and the Knox County Medical Examiner’s Office were called to a home on Bernstein Lane about 6 p.m. Thursday, according to the Sheriff’s Office. Beeler was discovered on the back porch of the residence dead from an apparently self-inflicted gunshot wound, according to the Sheriff’s Office.

His body was taken to the Regional Forensic Center for further examination, according to the Sheriff’s Office news release. An investigation into his death is ongoing.

Beeler aided in the FBI corruption investigation of state Rep. Ted Ray Miller in the late 1980s. That investigation led to a grand jury indictment against Miller, who died of an apparent suicide the day before the charges were expected to be returned.

Beeler later entered private practice after leaving Knox County.

Note: From memory, Beeler — acting as a lobbyist at the time — told investigators that Miller, then chairman of the House State and Local Government Committee, had solicited a bribe in exchange for help in passage of legislation involving a Knox County incinerator project in the committee. Beeler wore a tape recorder while talking to Miller about the deal. Miller also died from a self-inflicted gunshot.

TDOT to remove ‘corrupt officials’ billboards

The Tennessee Department of Transportation is moving to take down two bright yellow billboards on Interstate 240 in Memphis that declare TDOT Commissioner John Schroer and another department employee are “corrupt officials,” reports the Commercial Appeal.

The back-to-back signs sit atop a pole, one facing east and the other west, just west of the Perkins exit.

The boards state: “PUBLIC CORRUPTION: T DOT COM. SCHROER AND SHAWN BIBLE ARE CORRUPT OFFICIALS”.

The “T DOT COM.” refers not to some dot-com company, but to the Tennessee Department of Transportation commissioner. He is “Schroer,” full name John Schroer.

“Shawn Bible” works for TDOT, too. She is in charge of the Beautification Office, which, among other tasks, regulates billboards along the rights-of-way.

The agency is about to come crashing down on what courts have ruled to be an illegally erected billboard. Not because of the signs’ corruption allegation, but because the structure stands within the Nonconnah Creek flood way (where billboards are prohibited).

…William H. Thomas Jr., doing business as Thomas Investments, built the billboard, according to TDOT and court documents.

Thomas applied for the billboard permit from TDOT on June 8, 2006, court records show. A month later, TDOT denied the permit, citing the wrong zoning.

He built it anyway, based on a construction permit he got from the Office of Construction Code Enforcement which, in error, thought the site was not in the flood way.

…The case had been tied up in courts for several years. The Tennessee Court of Appeals ruled June 27 that the billboard is illegal and must be removed.

TDOT has given notice to Thomas to remove the billboard within 30 days or the agency will dismantle it at his expense. The 30 days have not expired, TDOT spokesman Nichole Lawrence said.

…Asked if there would be a response, legal or otherwise, to the corruption accusations, Lawrence said, “That is not a decision to be made by TDOT, but by the individuals themselves.” Asked if Schroer and Bible would respond to the billboard’s accusation, Lawrence said, “I don’t know that there will be any kind of response.”

Jury returns guilty verdict in Knox corruption trial

A trial that put a spotlight on corruption in the Knox County Trustee’s Office ended late Friday with a guilty verdict, reports the News Sentinel.

Jurors in Knox County Criminal Court spent more than seven hours deliberating before deeming Delbert Morgan, 58, guilty of felony theft. Judge Steve Sword set an Oct. 23 sentencing date.

The conviction carries a penalty range of eight to 12 years, but Morgan, who has no criminal history, qualifies for probation and perhaps judicial diversion. Diversion would keep the conviction off his record if he stays on the straight and narrow during a probationary period.

Defense attorney Jeff Daniel said a request for diversion “could be a possibility.”

Morgan was accused of ripping off taxpayers to the tune of $200,000 for collecting pay and benefits he did not earn. Prosecutors alleged he was a ghost employee put on the payroll by his college buddy, former Trustee Mike Lowe, as a favor.

…But Daniel framed the case not as thievery or corruption, but as a basic misunderstanding of the employment deal between Morgan and Lowe.

“The state is using all this evidence to create a false impression of this position he did not have,” Daniel said.

Morgan testified Lowe needed help valuing property deeded to the county when efforts to collect property taxes failed. Morgan already was a successful businessman with his own work to do. He agreed to help his buddy but, Morgan testified, on his own time.

Lowe said he’d set him up on a salary, and Lowe aide Sam Harb would handle his pay. Morgan signed blank time sheets and collected his paychecks.

Morgan testified he couldn’t remember how much time he spent working for Lowe but pegged the figure at no more than 15 hours per week. Harb admitted in testimony he’s the one who filled out the time sheets with all those bogus hours.

If anyone was a thief, Daniel argued, it was Harb.

“Sam Harb put the times in there,” Daniel said. “Why is Sam Harb not indicted?”

The way Daniel saw it, Morgan — albeit clueless about his salary or why his checks grew fatter over time — did the work Lowe said he would pay him to do.

Fortune finds TN the nation’s third most corrupt state (trailing MS and LA)

Lifted from the News Sentinel:
Researchers have developed an index that estimates the most and least corrupt states in the union, Fortune magazine reports.

Tennessee is ranked third on the list, preceded by Mississippi at No. 1 and Louisiana at No. 2.

To develop the index, the researchers, from the University of Hong Kong and Indiana University, studied more than 25,000 convictions of public officials for violation of federal corruption laws between 1976 and 2008 as well as patterns in state spending, according to Fortune.

The Forbes report is HERE.

Small town mayor puts city employees to work on building son’s house

News release from state comptroller’s office:
The mayor of the tiny Tipton County town of Brighton directed two public works employees to help build a house for his son, an investigation by the Comptroller’s office has revealed.

Brighton Mayor Jeff Scott sent the employees to property owned by his son, Hunter Scott. The employees initially thought that they were going to locate water meters on the property. However, when they arrived, they were ordered to do other tasks, including removing tree stumps, handling landscaping work and digging, preparing and pouring the house’s foundation.

During the course of the three days the employees were working at the construction site, they used a backhoe, dump truck, trailer and two other vehicles owned by the town. Mayor Scott oversaw their work during most of those three days.

Mayor Scott told the employees not to fill out their public works department time sheets for the time they had spent at the construction site because they would be paid by a private contractor who was supervising the project.

That contractor, a friend of Mayor Scott’s, later told investigators from the Comptroller’s office that he didn’t have a contracting license and was merely acting as a helper. The contractor paid for the employees’ time and reimbursed the town $200 for the use of the backhoe.

According to three local companies interviewed by investigators, a backhoe would typically rent for $240 to $312 per day. Investigators were unable to calculate how much of the town’s fuel was used at the job site due to a lack of adequate recordkeeping.

Investigators concluded that the use of town-owned equipment and town employees was an apparent abuse of the mayor’s power and created potential liability issues for the town.

The investigators recommended that the town’s board of mayor and aldermen calculate all costs funded by the town on the construction project and seek reimbursement from the mayor, his son and/or the contractor.

Also, investigators learned that one member of the board of aldermen had used the town’s backhoe at his home on two occasions and public works department employees and equipment were used to spread asphalt on private property owned by another local resident. Investigators recommended that the town also calculate those costs and seek reimbursement from the property owners.

“It is unacceptable for officials to use public resources for the exclusive benefit of private individuals,” Comptroller Justin P. Wilson said. “People pay taxes and fees with the expectation that money will be fairly distributed to provide services to all citizens, not just a select few who happen to know somebody at city hall. I commend our investigators for their fine work in bringing these issues to light.”

To view the investigation online, go to: http://www.comptroller.tn.gov/ia/.

John Ford: ‘The mistake I made was simply to trust people’

Former Tennessee state senator John Ford, convicted of bribery-related charges in the “Tennessee Waltz” corruption scandal, talked about his trial, conviction, and jail conditions with WMTV of Memphis in his first television interview since being released from prison.

Excerpts:

“Some say what I don’t know won’t hurt you. I beg to differ. What you don’t know will hurt you,” said Ford. “I don’t know what their motivation was … Except to go after John Ford.”

He wishes he had taken the stand during his trial
.
“[The video captured with taking money] was shown over and over again. They said, ‘Oh, he must have been doing something wrong.’ The mere fact of someone passing money to you or you taking money from someone is not a crime,” he said. “It’s not a federal crime. It’s not a state crime. It’s not a state law crime.”

Federal prosecutors called the tapes smoking guns. It consisted of eight video clips of Ford taking stacks of $100 bills from an undercover FBI agent in exchange for political favors.

Ford’s defense attorney Mike Scholl argued at the time that Ford believed the payments were for legitimate business advice.
“That money, in essence, was for me working for, as a consultant for the person who lied, so to speak, that they were in a music production business and wanted me to do things to help promote them,” said Ford.

…”When they pass the money along to you, for something else you’re doing for them, they do it and start talking about this bill. It makes it appear as though you’re receiving this for a bill,” said Ford. “He said, ‘Well look, I have your money for your consultant work. He does that and when he’s doing it, he starts saying he has this bill on this company and blah, blah, blah.”

Ford says he was advised not to take the stand during his trial and said his attorney ignored his request to argue entrapment.
Attorney Mike Scholl says if Ford wanted to argue entrapment he would have had to admit to taking a bribe.

….Despite prison conditions, Ford has ‘no regrets’

“It was overcrowded and they had me sleeping on the floor for three months, concrete,” said Ford. “I only ate enough to survive. I think I lost 25 pounds and a great deal of my health. I was in perfect health.”

Ford moved to a half-way house after his release from prison in August 2012. A state law passed during his time behind bars that prohibits felons from running for office does not apply to Ford.

“I can run again, if I want to. The law doesn’t stop me from running. The law was passed after and the law can’t go back,” said Ford.
Ford cannot go back either. He says he has no regrets.

“It hurt my children more so than it did me and a lot of my constituents, because it was something they couldn’t understand,” said Ford. “The mistake I made was simply to trust people I didn’t know that well … “It’s not how far you fall, it’s how you get up.”

DesJarlais makes ‘most corrupt’ list of CREW

News release from Citizens for Responsibility and Ethics in Washington:
Washington, D.C. — Today, Citizens for Responsibility and Ethics in Washington (CREW) named Rep. Scott DesJarlais (R-TN) one of the most corrupt members of Congress. Rep. DesJarlais, a licensed physician, engaged in inappropriate sexual relationships with two patients and made numerous false statements about his conduct, earning the congressman a place in CREW’s Most Corrupt Members of Congress report, an annual, bipartisan look at Washington’s worst.

(Click here to read the full report on Rep. DesJarlais.)

“The doctor-patient relationship is sacred, and a doctor who exploits that relationship to prey on women commits an undeniable abuse of power,” said CREW Executive Director Melanie Sloan. “Rep. DesJarlais’ repeated crossing of that ethical boundary directly reflects on his fitness to serve in Congress.”

In and around 2000, while working as a physician and before his election to Congress, Rep. DesJarlais engaged in a sexual relationship with a patient. News reports revealing the affair quoted from the transcript of a phone call Rep. DesJarlais recorded between himself and his patient in which Rep. DesJarlais, who was married at the time, urged his patient to get an abortion. After the disclosure of the affair, Rep. DesJarlais claimed he was not involved in recording the phone conversation, contradicting sworn testimony he gave during his 2001 divorce proceedings. When the record of his testimony was made public, Rep. DesJarlais retreated from his previous statements. He has repeatedly said the woman was not pregnant and did not have an abortion, contrary to her own testimony during the divorce proceedings. Rep. DesJarlais also engaged in a sexual relationship with another patient, and prescribed painkillers for her on dates at his home.
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Nashville: An Isolated and Corrupt State Capital?

Researchers who reviewed federal court convictions of state government officials from 1976 through 2002 say that the more isolated a state capitol is from the overall state population, the more corruption. (Note: The period would catch the convictions of Ray Blanton era officials, who were tried after he left office, and the “Rocky Top” scandal but not the 2005 “Tennessee Waltz” scandal.)
From a Los Angeles Times story on the study:
The most corrupt state capitals – Jackson, Miss., Baton Rouge, La., Nashville, Tenn., Pierre, S.D., Springfield, Ill., and Albany, N.Y., for example – are all more isolated than average. Nashville is the least so, being a major city in its own right although distant from other population centers in the state. Springfield and Pierre rank as the two most isolated on the list. The less isolated the capital, the more likely it is to rank low on corruption.
Isolation doesn’t explain everything, of course. Some states, such as Oregon, Washington and Vermont, have unusually low levels of corruption. But the impact of isolation appears strong.
What might cause the relationship between isolation and corruption, the researchers asked. One possibility was that newspapers, which provide most coverage of state governments, may be less likely to cover the capital when it is further from their circulation areas. So they examined the content of 436 U.S. newspapers, searching for references to state government. Sure enough, “in states where the population is more concentrated around the capital,” the study found “more intense media coverage of state politics, and therefore greater accountability.”
For example, they noted, newspapers in Massachusetts, where Boston, is the capital and by far the state’s largest city, cover state government more than do newspapers in New York, where Albany is a relative backwater.
“It stands to reason that when citizens are better able to monitor the performance of public officials and punish those who do misbehave, there will be less scope for the latter to misuse their office for private gain,” the researchers wrote.
The relationship between newspaper coverage and corruption has another troubling implication. In the past decade, the number of reporters covering state capitals has dropped sharply – a reduction of more than 30% between 2003 and 2009, according to a census by the American Journalism Review. If less coverage leads to more corruption, those staff cutbacks should provide plenty of work for prosecutors in years to come.

Former State Board Member Facing Felony Charges

A former Gov. Phil Bredesen-appointed member of the state Department of Commerce and Insurance’s Collection Service Board now faces federal charges, including 16 felony counts, related to three different investment schemes.
More from The City Paper:
In March 2011, the Tennessee Bureau of Investigation arrested Edward Shannon Polen, on three felony charges of theft, but the full scale of his alleged crimes came into focus on Monday when prosecutors from the U.S. Attorney’s Office in Nashville charged Polen with scamming 74 individual investors and banks out of $8,796,000.
Bredesen appointed Polen to the Collection Service Board, which oversees debt collection agencies in the state, in July 2008. He served a full term, before resigning on April 5, 2011, according to board minutes.
Polen, also a former Robertson County commissioner, is charged with five counts of bank fraud, three counts of mail fraud, three counts of wire fraud and two counts of money laundering for operating three investment schemes.
“Despite his assurances to investor-victims of significant returns on their investment … Edward Shannon Polen never intended to invest their funds as promised,” the charges state.