This compendium of news reports about corruption and ethics issues is brought to you by the Center for Ethics and Public Integrity (CEPI). Neither the National Association of Attorneys General nor the National Attorneys General Training & Research Institute expresses a view as to the accuracy of news accounts, nor as to the position expounded by the authors of the hyperlinked articles.
CEPI RESOURCES
2022 NAGTRI National Anticorruption Academy: The NAGTRI Center for Ethics & Public Integrity is pleased to partner with New York Law School in hosting a week-long Anticorruption Academy in New York City, New York from October 24-28, 2022. The Academy will provide prosecutors and law enforcement officers with essential tools to investigate, charge, and try corruption cases. From explaining legal concepts like legislative immunity and judicial privilege, to teaching about financial investigations, to addressing ethical issues that may arise in corruption cases, the Academy will address the needs of both new and seasoned corruption fighters. While we encourage in-person attendance, we are also offering a live-streamed, virtual version of the program. The Anticorruption Academy will feature presentations by current and former prosecutors, including from the U.S. Department of Justice Money Laundering and Asset Recovery Section, and by academics, including members of the New York Law School faculty and administration. Attendees will receive a copy of The Anticorruption Manual: A Guide for State Prosecutors, a comprehensive guide to investigating, charging, and trying corruption cases, which retails for $125. Please contact Maria Humayun at mhumayun@naag.org if you have any questions.
The Anticorruption Manual: A Guide for State Prosecutors: CEPI’s comprehensive Anticorruption Manual was published in August 2021. This is the first publication in thirty years to guide prosecutors who investigate and charge public corruption crimes. It is the first-ever book designed to address the needs of state and local corruption prosecutors. The book is available for purchase; members of the attorney general community should log into to their NAAG accounts to access a discount code, and other prosecutors should email Zayn Hasan at zhasan@naag.org for their discount code. A free sample chapter addressing judicial corruption is available for download. A series of articles further describes the purpose and contents of the manual.
CORRUPTION CASES
STATE
2 Ex-Phoenix School District Accounting Specialists Indicted in Connection with Fraud Scheme: Two former budget accounting specialists in the Wilson Elementary School District in Phoenix, Arizona were indicted on charges relating to their alleged embezzlement. Ryan Mariano was indicted on charges of fraudulent schemes and artifices, theft over $25,000, misuse of public funds, and forgery. He is alleged to have misused his position to deposit unauthorized district checks exceeding $25,000 into his personal account. April Childs was indicted on charges of fraudulent schemes and artifices, theft over $4,000, and forgery. Childs is accused of depositing unauthorized district checks exceeding $4,000 into her personal account. The case was investigated by the Office of the Arizona Auditor General, which produced a report, and is being prosecuted by the Arizona Attorney General’s Office.
Glenwood Mayor Resigns After Pleading Guilty to Theft of Asphalt Millings: The mayor of Glenwood, Arkansas, Billy Smith, pleaded guilty to theft of property and abuse of office. In August 2021, Smith hired a private company to transport thousands of dollars of asphalt millings from a state resurfacing project to his home and the home of a family member to resurface their private driveways. Smith resigned from office and will pay $3,000 in restitution, a $250 fine, and court costs. The case was investigated and prosecuted by the Public Integrity Division of the Arkansas Attorney General’s Office.
Kentucky Sheriff Indicted on Charges of Misconduct, Witness Tampering: Donald Jones, Sheriff of Webster County, Kentucky, was indicted on charges of official misconduct and tampering with a witness. Jones allegedly contacted a potential witness in a case in his jurisdiction and made a false statement with intent to affect the witness’s testimony. Jones also allegedly gave advice to a defendant in a criminal case he helped investigate. Jones was charged by the Kentucky Attorney General’s Office.
Former Sterling Heights City Council Candidate Charged with Election Fraud: Paul Manni, an unsuccessful candidate for Sterling Heights City Council in Michigan, was charged with nine counts of forging a signature on an absentee voter ballot application and nine counts of making a false statement on an absentee voter ballot application. In the November 2021 election, Manni allegedly personally dropped off approximately 50 absentee voter applications with his signature. Nine of the voters included in the applications were contacted by the staff of the City Clerk’s office and stated that they did not seek to apply for an absentee ballot. None of the applications turned in by Manni resulted in a valid ballot going to the voter. The Michigan Attorney General’s Office is handling the case.
Platkin Announces Charges Against Trenton Police Officer Who Allegedly Hid Gang Ties: Rudy Lopez, a police officer in Trenton, New Jersey, was charged with official misconduct, conspiracy, and tampering with public records. The records charge is based on Lopez’s denial on his job application that he was associating with gang members. Prosecutors alleged that, in fact, Lopez was regularly communicating with an imprisoned member of the Almighty Latin King and Queen Nation. Lopez allegedly helped the incarcerated individual plan an assault against a suspected cooperating witness. The case is being prosecuted by the Office of Public Integrity and Accountability in the New Jersey Attorney General’s Office.
Pennsylvania Defense Attorney Paid Clients for Sex, Prosecutors Say: Corey Kolcharno, a criminal defense attorney and former prosecutor in Lackawanna County, Pennsylvania, was charged via criminal complaint with promoting prostitution. Kolcharno worked as an assistant district attorney until 2011, when he began working as a private practice defense attorney. The alleged crimes occurred while Kolcharno was in private practice, working for clients experiencing financial hardship, substance abuse, and other difficult circumstances. Kolcharno performed legal services for a client and did not request payment, but instead requested sexual acts from the client and paid her money for those acts. The case was investigated and is being prosecuted by the Pennsylvania Attorney General’s Office as well as the Pennsylvania State Police.
FEDERAL
FBI Arrests Former Rep. T.J. Cox on Dozens of Fraud Charges: Former California congressman, T.J. Cox, was indicted on charges of wire fraud, money laundering, financial institution fraud, and campaign contribution fraud. Cox allegedly participated in multiple fraud schemes over several years. Cox diverted client money into personal, unauthorized accounts, resulting in a gain of over $1.7 million. He fraudulently obtained mortgage loan funds for a rental property and fraudulently obtained a $1.5 million construction loan. Cox used some of the fraudulently obtained money for his campaign for Congress, funding and reimbursing individual donations from family and friends.
Real Estate Mogul Linked to SF Corruption Scandal Found Guilty of Bank Fraud: A jury has found Victor Makras, a San Francisco, California real estate broker, guilty of making false statements to a bank and of bank fraud tied to fraudulent representations made in a mortgage refinance loan application. Makras falsely represented that the borrower was indebted to Makras in an inflated amount of $915,000, which concealed from the lender actual debts owed by the borrower. Makras was indicted jointly in October 2021 with Harlan Kelly, the former General Manager of the San Francisco Public Utilities Commission, who was allegedly the borrower and co-conspirator in the scheme to defraud the bank. Kelly has pleaded not guilty and not yet gone to trial. The case against Makras and Kelly is related to the a case against former San Francisco Public Works chief, Mohammed Nuru, who pleaded guilty to one count of honest services fraud in January 2022 and was recently sentenced to seven years in prison.
Alexandra Cadet Took Bribes to Help Drug-Treatment Centers Open Faster. Now She’s Headed to Prison: Alexandra Cadet, a licensing specialist for the Florida Department of Children & Families in Palm Beach County, Florida, and Shannel Escoffery, a consultant for drug-treatment facilities, pleaded guilty to extortion conspiracy. The conspiracy consisted of Escoffery working with facilities to prepare their licensing applications and telling them that extra cash would expedite the licenses. That extra cash was delivered in part to Cadet, who would expedite the applications.
Woman Accused of Stealing $1.3 Million from State Tuition Assistance Program: Karen C. Lyke, a counselor at the Georgia Vocational Rehabilitation Agency, was charged in a criminal information with one count of conspiring to commit federal program theft for forging records and creating fake students with disabilities and illnesses to obtain monetary benefits totaling over $1.3 million. Georgia’s Vocational Rehabilitation Program helps people with disabilities by providing funding and tuition assistance for college education. Lyke used names of friends and family members to create fraudulent medical records and other official records necessary to apply for financial benefits. Lyke used the stolen funds to pay for personal expenses. Lyke also stole government computers and sold them for profit. Lyke has stated that she intends to plead guilty.
Shreveport Police Officer Facing Serious Charges Today: James Cisco, a police officer in Shreveport, Louisiana, was indicted on charges of wire fraud for allegedly defrauding the City of Shreveport out of funds designated for overtime pay for police officers. Cisco is alleged to have claimed that he worked overtime when he did not and falsified reports regarding his work hours.
Late Hyattsville Mayor Accused of Embezzling Funds from D.C. Charter School Network: In a civil forfeiture complaint in rem, the U.S. Department of Justice has alleged that Kevin Ward, the late mayor of Hyattsville, Maryland who died by suicide in January 2022, embezzled $2.2 million from KIPP DC, a charter school operator in Washington, D.C. for which Ward worked as the senior director of technology. The action seeks to forfeit specific real properties, vehicles, and art and sports memorabilia that were purchased with proceeds of wire fraud and theft from a program that received federal funds. At the beginning of the COVID-19 pandemic, KIPP DC transitioned to remote learning and planned to purchase additional computers and software. Ward allegedly registered a corporation, Tenret Tech, in April 2020. Ward allegedly arranged for KIPP DC to pay Tenret Tech $2.2 million between April 2020 and October 2021 for computers, software, and related services. Tenret Tech never delivered any of those products or services.
Former Detroit Cop Who Led Integrity Unit Pleads Guilty in Bribery Conspiracy: Former Detroit (Michigan) Police Lieutenant and former leader of the department’s integrity unit, John F. Kennedy, pleaded guilty to conspiracy to commit bribery. Kennedy conspired with another police officer, Daniel Vickers, to accept over $14,000 and other benefits from the owner of a towing company and from an undercover federal agent in exchange for persuading other officers to make towing referrals to that towing company. By making direct towing referrals, Kennedy and Vickers were also violating the city’s rules and ordinance requiring a rotation of towing companies. This case is part of the broader federal investigation into corruption in Detroit, known as Operation Northern Hook.
Flordell Hills Clerks Accused of Stealing $663,000 from Tiny North St. Louis County Town: Maureen Woodson, former city clerk of Flordell Hills, Missouri, and Donna Thompson, former assistant city clerk, were indicted on charges of wire fraud and mail fraud. The pair, who were roommates, are alleged to have embezzled $663,000 between 2016 and 2022 from Flordell Hills through wire transfers and bank checks. They allegedly used the stolen money to pay for personal expenses, including entertainment and gambling. The annual budget for the town is about $400,000.
Ex-St. Louis Alderman John Collins-Muhammad Admits Federal Corruption Charges: Former St. Louis, Missouri, alderman John Collins-Muhammad pleaded guilty to charges of bribery and honest services wire fraud. Collins-Muhammad admitted accepting $7,000 in cash, $3,000 in campaign donations, a new cell phone, and a new car from a local businessman in exchange for sponsoring bills providing a property tax abatement to the businessman. Collins-Muhammad was indicted with two other St. Louis officials, Lewis Reed and Jeffrey Boyd, who have also pleaded guilty.
Former Tennessee House Speaker Glen Casada, Cade Cothren Indictment Carries Heavy Penalties: Former Tennessee House Speaker Glen Casada and his aide Cade Cothren were indicted on charges of theft from programs receiving federal funds, bribery and kickbacks concerning programs receiving federal funds, honest services wire fraud, conspiracy to commit money laundering, and other related crimes. Casada, Cothren, and another conspirator allegedly sought to enrich themselves by using their positions to approve Phoenix Solutions to provide mail services to other members of the Tennessee General Assembly. Phoenix Solutions was allegedly operated by Cothren, even though it was purportedly run by a fictitious political consultant. Casada, Cothren, and the other conspirator allegedly sought to obtain government funds for Phoenix Solutions and political consulting businesses owned by Casada and the other conspirator. Casada and the other conspirator also allegedly received bribes and kickbacks from Cothren in exchange for approving Phoenix Solutions as a vendor.
‘Mere Gratuities’: Dallas Developer Convicted of Bribing Dwaine Caraway Gets Sentence Vacated: The Fifth Circuit Court of Appeals has vacated the bribery conviction of Ruel Hamilton, a real estate developer in Dallas, Texas who was convicted in June 2021 of one count of conspiracy and two counts of bribery of an agent of a local government receiving federal funds and sentenced to eight years in prison. The evidence at trial showed that Hamilton paid Carolyn Davis, then Chair of the Dallas Housing Committee, tens of thousands of dollars and Davis, in return, supported including Hamilton’s housing project on a slate of projects recommended to the state to receive low-income housing credits. The project was recommended to the state but did not actually receive any credits. Davis pleaded guilty in 2019 to accepting bribes. Hamilton also paid $7,000 in 2018 to then councilman, Dwaine Caraway, while Hamilton was seeking to persuade the Dallas City Council to get an ordinance on the ballot in an upcoming election. Caraway pleaded guilty in 2019 to one count of conspiracy to commit honest services wire fraud and one count of tax evasion in an unrelated matter. The Fifth Circuit ruled that the jury instructions, which “told the jury that neither a quid-pro-quo exchange nor any ‘official act’ by the councilmembers was required,” was erroneous because federal programs bribery “does, in fact, require a quo; a quid alone will not suffice.” The case has been remanded to the district court, where federal prosecutors will have the opportunity to retry Hamilton with a jury instructed in a manner consistent with the Fifth Circuit’s requirements, which differ from the majority of federal courts of appeal.
Former Richardson Mayor Laura Maczka Jordan Sentenced to Six Years in Federal Prison for Bribery, Tax Fraud: Former mayor of Richardson, Texas, Laura Maczka Jordan was sentenced to six years in prison after a jury convicted her of bribery concerning a program receiving federal funds, conspiracy to commit bribery concerning a program receiving federal funds, tax fraud, and conspiracy to commit tax fraud. Mark Jordan, her husband, was convicted of the same crimes and received the same sentence. While she was mayor, Laura Jordan began a romantic relationship with her now husband, who is a real estate developer. The mayor voted to change zoning rules to allow him to build apartment complexes in residential areas and to increase the number of units allowed. She also approved her now-husband’s company receiving an economic development reimbursement of $47 million. In exchange, he offered the mayor $18,000 in cash, $40,000 by check, and other benefits such as travel and home renovations, as well as a job at his company.
San Antonio Man Sentenced for Embezzling $1.1M from Johnson City While He Worked There: Anthony Holland, former City Secretary and Chief Administrative Officer of Johnson City, Texas, was sentenced to 37 months in prison after pleading guilty to one count of theft from a state or local government that receives federal funds. Holland falsified city financial records to embezzle over $1.1 million. In addition to incarceration, Holland must pay $1,175,866.91 in restitution.
ETHICS
Lawyer’s Group Text Causes 2nd Florida Murder Case Mistrial: Assistant State Attorney Katya Palmiotto, while prosecuting a homicide case in Broward County, Florida, sent a text message complaining about a ruling in the case to a group that included Judge Peter Holden, who was presiding over the case. The group that received the text message consisted of current and former homicide prosecutors. Holden, prior to taking the bench in 2018, was a homicide prosecutor and he remained a member of the group text chat. The defense attorney moved for a mistrial based on the ex-parte communication between the prosecution and the judge. Holden granted the motion.
Top St. Louis Prosecutor is Reprimanded for Discovery Missteps, Misstatements in Then-Governor’s Prosecution: St. Louis Circuit Attorney Kimberley Gardner was formally reprimanded by the Missouri Supreme Court for her handling of a 2018 investigation into then-Missouri Governor Eric Greitens. The reprimand follows a joint stipulation by Gardner and the Missouri chief disciplinary counsel’s office that Gardner had violated rules regarding access to evidence, discovery, and candor toward the court. The original ethics complaint against Gardner was filed in March 2021.
Board: SD Gov. Kristi Noem May Have ‘Engaged in Misconduct’: The South Dakota Government Accountability Board found sufficient information that Governor Kristi Noem may have engaged in misconduct in relation to Noem’s role in her daughter’s application to become a real estate appraiser. The board recommended appropriate action but did not specify what that action was. With respect to a second complaint—whether Noem misused the state airplane—the board referred the matter to the South Dakota Attorney General’s Office for investigation.
INTERNATIONAL
U.S. to Return to Peru Funds Seized from Ex-President in Odebrecht Case: The U.S. Department of Justice will return to Peru approximately $686,000 that was seized from Alejandro Toledo, former president of that country. Brazilian construction company Odebrecht allegedly paid Toledo $25 million in bribes between 2001 and 2006 in exchange for highway construction contracts. Toledo used $1.2 million of that money to purchase real estate in Maryland. That real estate was sold and Toledo had been keeping proceeds of the sale in an American bank account.
Venezuelan Man Paid Bribes to Win Oil Contracts from State-Chevron Joint Venture, Feds Say: Rixon Rafael Moreno Oropeza, a Venezuelan businessman, has been indicted on charges of money laundering. Moreno allegedly paid bribes to a relative of Venezuelan President Nicolas Maduro to obtain multimillion-dollar contracts from a joint venture between Petropiar, Venezuela’s state-owned oil company, and Chevron U.S.A., Inc. Moreno allegedly sent millions of dollars in bribes to Petropiar officials from bank accounts that he controlled in Miami, Florida, and, in exchange, he received millions of dollars in contract payments from Petropiar into those Miami bank accounts.
OTHER
Judge Again Rejects Graham Bid to Throw Out Subpoena in Atlanta-Area Trump Probe: As part of the Fulton County Special Purpose Grand Jury investigation into attempts to disrupt the Georgia 2020 elections, U.S. Senator from South Carolina Lindsay Graham received a subpoena. Graham sought to quash that subpoena on the grounds that his testimony would be protected by the federal Speech or Debate Clause. On August 15, the federal district court denied the motion to quash. Graham appealed and, on August 22, the Eleventh Circuit Court of Appeals temporarily stayed the August 15 order and remanded to determine whether partial quashal or modification of the subpoena was appropriate. Graham argued that the court should quash the subpoena relating to any questions about phone calls Graham made to Georgia election officials because they were investigatory phone calls protected by the Speech or Debate Clause. The district court determined that, in some instances, fact-finding inquiries can be protected by Speech or Debate Clause, but that it was not proven that Graham’s phone calls were entirely fact-finding in nature. If a phone call involved persuading Georgia election officials to throw out ballots or otherwise change election processes, it would not be protected by the Speech or Debate Clause. The Speech or Debate Clause also would not preclude questioning regarding Graham’s communications with the Trump Campaign or Graham’s public statements about the Georgia’s 2020 elections. Georgia Governor Brian Kemp has also received a subpoena to testify as part of the same investigation and has sought to quash that subpoena, arguing that the Fulton County District Attorney Fani Willis has politicized the investigation, that sovereign immunity applies, and that some of the information sought may be protected by attorney-client privilege or executive privilege. Kemp’s motion to quash was denied, but the court ordered that his testimony be delayed until after the November 8 election.
Atlanta Prosecutor Must Face Lawsuit Over Witness’ Arrest: A three-judge panel of the Eleventh Circuit Court of Appeals determined that a Fulton County, Georgia assistant district attorney, Antoinette Stephenson, is not entitled to absolute immunity for failing to withdraw a material witness warrant. Stephenson had obtained a warrant requiring Kidanemariam Kassa to appear as a witness at trial. Kassa appeared voluntarily. After the trial ended, Stephenson failed to ask the trial judge to recall the warrant, which resulted in Kassa being arrested and jailed for six days. Kassa sued Stephenson for deprivation of civil rights and Stephenson moved to dismiss citing absolute prosecutorial immunity. The Eleventh Circuit disagreed with Stephenson, allowing the suit to proceed. The State of Georgia, as amicus, has petitioned for a review by the full Eleventh Circuit.
Former Judges Who Sent Kids to Jail for Kickbacks Must Pay More than $200 Million: Mark Ciavarella and Michael Conahan, two former Pennsylvania judges who were previously convicted of racketeering, money laundering, and conspiracy for accepting over $2 million in illegal payments from the builder and co-owner of two for-profit detention centers to which the judges sent thousands of juveniles, were found liable for over $200 million in civil damages to the families of the juveniles. After hearing testimony from individuals who appeared before the judges as juveniles and from parents of then-juveniles, the federal court hearing the civil case awarded $106 million in compensatory damages and $100 million in punitive damages to the plaintiffs. The court explained that “children and adolescents suffered unspeakable physical and emotional trauma at the hands of two judicial officers who swore by solemn oath to uphold the law” and called the judges’ actions “cruel and despicable.”
SC Attorney General Wants Investigation into Spending Practices in Richland One: The South Carolina Attorney General’s Office requested that the Office of the Governor call for the Office of Inspector General to investigate Richland County School District One’s use of state funds through the State Purchase Card Program. The request regarding District One follows an investigation of misspending in District Two in the same county. The Attorney General’s Office applauded the investigation into District Two and stated that it has received many similar complaints about District One. Parents of school children alleged that District One employees have misspent education funds on personal transactions including purchases from grocery stores, fast food restaurants, florists, dry cleaners, and social groups.
