Alabama: No Verdicts of Guilty in Graft Case

In Alabama, No Verdicts of Guilty in Graft Case
By CAMPBELL ROBERTSON

MONTGOMERY, Ala. — A sprawling federal investigation begun nearly two years ago into corruption at the highest levels of state politics concluded Thursday with acquittals or mistrials, ending, at least temporarily, a case that could have put sitting politicians and powerful campaign donors behind bars.

Of the nine defendants — including four current or former lawmakers, two high-profile lobbyists and one of the most powerful businessmen in the state — a federal jury found two not guilty on all counts and acquitted the rest on some counts, while a mistrial was declared on others. No one was convicted on any charge. Jurors had deliberated for a week.

The case, which involved allegations of a scheme in which casino operators and lobbyists bribed state lawmakers for favorable votes on a gambling bill, was unquestionably a complicated one.

But while the judge has already said he will schedule a new trial within the month and new indictments are even expected, the result was a serious blow to federal prosecutors, who had charged defendants on 39 counts including bribery and extortion.

“They scored zero today,” said Susan James, the attorney for Jay Walker, a former spokesman for an Alabama casino complex who was acquitted on all but two charges. “This jury didn’t give the government a thing, not one thing.”

Milton McGregor, a multimillionaire casino operator and prodigious political donor who was the chief target of the prosecution, was found not guilty on three counts and faced a hung jury on 14 others, including a conspiracy charge. “We appreciate the jury’s service in this important public corruption trial,” said a Justice Department spokeswoman. “Our prosecutors will discuss next steps as we move forward in this matter.”

It was an anticlimactic result to a political and legal saga in Alabama going back for years over the legality of so-called electronic bingo machines, which are nearly identical in appearance to slot machines.

The former governor, Bob Riley, and several judges found that these types of machines were against state law, despite the fact that they had sprouted up throughout the state and could be found in huge numbers at Mr. McGregor’s greyhound racing track, VictoryLand.

The machines were to be the cornerstone of another planned casino complex, called Country Crossing, in which Mr. McGregor had a financial stake.

In the spring of 2010, the state legislature considered a constitutional amendment that would have settled the legal question, permitting and regulating some forms of gambling, including electronic bingo.

During the session, rumors surfaced of a federal investigation, involving wiretapped phones and legislators wearing concealed recording devices. Last October, 11 people were arrested on charges of participating in a wide-ranging conspiracy to bribe lawmakers in return for “yes” votes on the legislation. Two would later plead guilty.

Over the course of the trial, jurors were treated to an inside look at a nexus of lobbying, politics and big business in Alabama, and the view was not pretty. Casual racism and sexism peppered expletive-laden conversations, promises of money were routine and many lawmakers, even those who knew they were on tape, seemed to have no problem bad-mouthing their colleagues.

Whether or not there are eventual guilty verdicts, there is certain to be collateral damage from some of the trial testimony.

The prosecution’s case largely revolved around the testimony of two men who had pleaded guilty to taking part in the alleged bribery scheme, thousands of phone calls that federal agents had intercepted and face-to-face conversations that were secretly recorded by three state lawmakers. Many of the conversations involved Mr. McGregor and lobbyists discussing campaign donations with lawmakers as they counted votes on the gambling legislation.

Defense lawyers argued that the discussions did not constitute bribery, even when cooperating witnesses said that bribery was implied and understood. The prosecution and the cooperating witnesses, defense lawyers argued, were giving a nefarious cast to conversations about the routine give-and-take of politics.



No convictions after 2-month Ala corruption trial
By PHILLIP RAWLS, Associated Press

MONTGOMERY, Ala. (AP) — The allegations stunned the Alabama Statehouse: lawmakers accused of selling their votes on legislation to legalize electronic bingo games at a time when the then-governor was ordering raids on gambling halls to seize the machines.

The buyers? According to federal prosecutors, those who would benefit most: casino owners who made a killing from gamblers attracted to the flashing lights and colors of the electronic machines.

The trial against two sitting senators and two former ones, a well-known casino owner and four others lasted more than two months that included a week of deliberations by jurors who Thursday delivered a stunner of their own — no convictions.

"The jury didn't give the government a thing, not a single thing," defense attorney Susan James said.

The inquiry started when three Republican legislators told the FBI they were offered campaign contributions if they would support the legislation.

The three used devices to record phone calls and meetings. The FBI wiretapped phones in a yearlong probe that coincided with former Gov. Bob Riley creating a gambling task force to shut down privately operated casinos. He contended they were illegal slot machines, while proponents portrayed them as a high-tech version of paper bingo, which is legal in some Alabama counties.

Legislators tried to pass electronic bingo bills in 2009 and 2010. Both failed.

Behind the scenes, federal prosecutors said, operators of the two largest private casinos and teams of lobbyists were offering millions in campaign contributions, benefit concerts by country music artists, free polling and hidden $1 million-a-year payments in return for votes.

On Oct. 4, agents arrested nine people and charged them with bribery and fraud in an alleged scheme that the head of Justice Department's criminal division called "astonishing in scope ... a full-scale campaign to bribe legislators and others."

For months, jurors listened to more than 80 recordings of lawmakers, lobbyists and casino owners — some with salty language and racially charged comments — as prosecutors tried to prove their case. The defense pushed the argument that it's normal to discuss campaign contributions in an election year and that none of the 12,000 recorded phone calls had any senator agreeing to commit bribery by exchanging a vote for a campaign contribution.

After five days, jurors said they were deadlocked on many of the charges and didn't think they could ever come to a conclusion. The judge told them to keep talking.

Two days later, they came back and outright acquitted two defendants — state Sen. Quinton Ross Jr. of Montgomery and Robert E. "Bob" Geddie Jr., lobbyist for Victoryland casino owner Milton McGregor.

The rest, including McGregor, were acquitted on some charges and the 11 women and one man on the jury could not reach verdicts on other counts. U.S. District Judge Myron Thompson declared a mistrial on all unresolved charges and said he will announce a date for a retrial within a month.

Geddie's attorney was visibly upset as he left the courthouse.

"It's an unbelievable thing that the government can put an innocent citizen through this with no evidence," Jimmy Judkins said.

After the failure to convict, at least this time around, the Justice Department issued a two-sentence statement that did not indicate whether prosecutors would continue to pursue all unresolved charges against the remaining seven defendants.

"We appreciate the jury's service in this important public corruption trial. Our prosecutors will discuss next steps as we move forward in this matter," spokeswoman Laura Sweeney said in an email.

The attorney for accused state Sen. Harri Anne Smith of Slocomb said the Washington-based prosecutors failed to paint Alabama politics and members of the Legislature as dishonest.

"To say that Alabama is besmirched with bad politics is not true. We've got a great Legislature," Jim Parkman said.

Smith was acquitted of one count of bribery, one count of extortion and nine counts of honest services fraud. Jurors failed to agree on the other charges against her.

She, Ross and two former senators on trial voted in favor of the legislation that passed the Senate in 2010. The FBI disclosed its investigation of Statehouse corruption two days later, and the bill died in the House without ever coming to a vote.

Smith and Ross won re-election after being indicted. Ex-Sens. Larry Means of Attala lost, and Sen. James E. "Jim" Preuitt of Talladega dropped his re-election campaign.

Means was acquitted on 14 of the 16 charges against him and got a mistrial on the remaining two, conspiracy and bribery. Preuitt was found not guilty of 12 of 15 charges, with mistrials declared on one count each of conspiracy, bribery and lying to an FBI agent.

Federal prosecutors have gone after corruption before in the state with much more success.

They produced convictions of former Gov. Don Siegelman and former HealthSouth CEO Richard Scrushy for bribery and 17 people, including three legislators, in an investigation of corruption in the state's two-year college system.

And prosecutors did get three people to admit guilt in the gambling case. Country Crossing casino developer Ronnie Gilley and two of his lobbyists, Jennifer Pouncy and Jarrod Massey, pleaded guilty to conspiracy and testified against the nine defendants.

McGregor's attorney said the split decision and the prospect of a retrial leaves efforts to pass pro-gambling legislation and reopen closed casinos in limbo. McGregor was acquitted of one count of bribery and two counts of honest services fraud. The jury failed to reach a verdict on his 14 other charges.

During the trial, Gilley and lobbyist Massey talked about arranging a campaign fundraiser for Smith with country singers Lorrie Morgan and John Anderson to make sure she supported the gambling bill and testified about working with McGregor to offer a $1 million-a-year job to another senator who was helping the FBI.

Pouncy testified about offering $2 million in campaign support to Preuitt, agreeing to give a $100,000 contribution to Means, and being aggressively pursued by Ross for donations as the Senate was approaching a vote on the gambling bill.

Republican Sen. Scott Beason of Gardendale wore a recording device in one meeting where Gilley, Massey and McGregor were seeking his vote, and he recorded McGregor saying, "Ronnie and I are just alike in that we've got a bad habit of supporting our friends."

Alabama's Republican governor and GOP legislative leaders declined comment after the split decision because some charges must be retried.

Others on trial and the decisions:

— Jay Walker, spokesman for Country Crossing casino, was acquitted of 11 counts of honest services fraud. A mistrial was declared on one count each of conspiracy and bribery.

— Joseph Raymond "Ray" Crosby, a former bill writer for the Legislature, got a mistrial on his only count of bribery.

— Thomas E. Coker, a lobbyist for McGregor, was acquitted of 11 counts and got a mistrial on one count each of conspiracy, bribery and honest services fraud.

Associated Press writer Bob Johnson contributed to this report.