Tag: Tennessee Waltz

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Opinion

Keeping It Unreal

So the government fired five shots at John Ford and hit him once, federal prosecutors kept their Tennessee Waltz winning streak unbroken, and the E-Cycle FBI Actors Repertory Company closed another Memphis performance.

This one was a little shaky. Prosecutors said they are sending out a strong message of deterrence. But four years after its inception, Operation Tennessee Waltz still looks more like a sting targeting Democrats in Memphis and Chattanooga than a purge of “systemic corruption” in state government. Its success is due to secret tapes of a handful of public officials taking bribes from a fake company that their colleagues were too honest, too smart, or too irrelevant to deal with.

Or maybe they just know how to Google.

Type “Joe Carson” and “FBI undercover” in a Google search and you find that Joe Carroll, whose FBI undercover name is Joe Carson, starred in at least two FBI undercover productions before Tennessee Waltz. In “Operation Lightning Strike” from 1991 to 1994, he posed as a big shot for Eastern Tech Manufacturing Company, a phony business seeking crooked contracts in the aerospace industry in Houston. His undercover name? Joe Carson. The sting resulted in indictments and a mistrial.

In 2001, Carroll and the FBI resurrected “Joe Carson” in a Maryland undercover operation targeting state lawmakers. His phony Atlanta-based company was seeking crooked deals with Comcast for fiber-optic contracts. A former state senator, Thomas Bromwell, is under federal indictment but has not yet gone on trial.

Give the FBI, Carson, L.C. McNeil, and Tim Willis credit for pulling off a two-year Tennessee undercover operation, including the 2004 and 2005 legislative sessions, without a leak. The Ford tapes were so powerful that the defense barely tried to explain them away. They left no doubt that money was exchanged for special legislation. The sting worked, but it hasn’t yet exposed corruption in real deals in high places.

Operation Tennessee Waltz started in 2003, after FBI agents investigating phony contracts in Shelby County Juvenile Court found evidence of “systemic corruption” in state government. Seven of the 11 Tennessee Waltz indictments were announced at a press conference in Memphis on May 26, 2005. The investigation, convictions, and guilty pleas since 2003 have produced no indictments for bribery or other wrongdoing by any full-time state employee, lobbyist, or contractor. On tape, Ford boasts that he is the man who “does the deals” and “control[s] the votes,” but his trial was all about E-Cycle and legislation that never got beyond committee.

“Systemic corruption,” it seems, is a product of Shelby County and Hamilton County, two of the 95 counties in Tennessee. Five Memphians have been convicted or pleaded guilty. In a conversation with agent McNeil in 2004, Barry Myers, the bag man who later became a government witness, explained why lawmakers were wary of the free-spending black millionaire: “To be honest with ya’, most of the money I used to pick up come from white folks, white males, established businessmen that would send money to Kathryn, Lois, Roscoe, and John. That’s where the real money came from.”

Who spent the “real money” for “the big juice” — Ford, Roscoe Dixon, Kathryn Bowers, and Lois DeBerry? We don’t know. The payment of “consulting fees” by real companies is at the heart of Ford’s pending case in Nashville, which is not part of Tennessee Waltz. He has a hearing on May 3rd. Eli Richardson, assistant U.S. attorney in Nashville, said “it remains to be seen” how the Memphis case will mesh with the Nashville case, which apparently relies on old-fashioned evidence and witnesses.

“The conviction in Memphis opens up all kinds of possibilities for plea negotiation that didn’t exist before,” said Bud Cummins, a former federal prosecutor in Arkansas. “But there is not a whole lot of pressure on the government. They are still holding most of the cards. My best guess is they’re pretty intent on going to trial.”

Ford could appeal his Memphis conviction and request a sentencing delay until after he is tried in Nashville. If he is sentenced and goes to prison before his appeal is resolved, he could still be tried on the Nashville charges.

“We try people all the time who are sitting there in prison clothes,” Cummins said, although Ford would probably be unrestrained and in civilian clothes in the courtroom, with a federal marshal standing behind him.

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News

John Ford Guilty on Bribery Charge

John Ford became the latest casualty of the FBI’s Tennessee Waltz sting Friday when a jury returned a guilty verdict for bribery, one of five counts the former state senator was charged with.

That was Count Two of the indictment against Ford. The jury could not agree on Count One, a charge of extortion, and presiding Judge Daniel Breen declared a mistrial on that count.

Three other counts, relating to charges of witness intimidation alleged against Ford, resulted in Not Guilty findings.

Sentencing of Ford was set for Tuesday, July 31, at 9 a.m. — a point in time distant enough to allow for an appeal of the verdict by Ford, as well as possible negotiations between himself and the U,.S. Attorney’s office that might involve an offer of cooperation in future prosecutions.

The jury’s deadlock on the Count One extortion charge would seem to mean that defense attorney Mike Scholl gained some traction in his efforts to demonstrate undue inducements on Ford by FBI agents. The senator ultimately was persuaded to accept some $55,000 for legislative aid given the bogus E-Cycle computer firm.

There apparently was no such disagreement on Count Two, alleging bribery. That charge was backed up by countless FBI surveillance videos showing Ford, then an influential state senator, accepting sums of money in 2004 and 2005.

The three intimidation counts were always regarded as the weakest points of the indictment, and, though surveillance evidence was presented in court to substantiate that Ford had issued threats against agent “L.C. McNiel” and undercover informant Tim Willis, it was not corroborated in depth and was clearly subject to alternate interpretations.

How the verdict came

News of a pending verdict was circulated at about 3 p.m., Friday, the third full day of deliberations. The 11th-floor courtroom of Judge Breen was quickly filled up by members of the media, friends and family of ex-Senator Ford, and representatives of the U.S. Attorney’s office and the F.B.I.

A message from the jury,shared with the prosecution and the defense by Judge Breen, quickly established that all counts had been resolved except for one. Sensing victory, chief prosecutor Tim DiScenza moved for acceptance of the available counts and for a declaration of mistrial on the unresolved one. Defense attorney Scholl asked for time to consult with his client.

In the end, DiScenza’s preference would be honored by Judge Breen after the judge had called the jury in and heard from its foreman that no agreement was possible on Count One.

Two circumstances had prefigured the outcome. One was a question had come to Judge Breen late on the evening before asking in effect for a definition of a phrase in the indictment relating to official culpability.

The other indication that a verdict of some sort was imminent came when jurors opted not to go out for lunch on Friday but had food delivered, which they ate quickly before resuming afternoon deliberations.

Ford ‘Disappointed’

Although the accusaed senator had enjoyed a leisurely lunch with members of his immediate and extended family at a downtown grill, his attitude was clearly one of somber apprehension, as was theirs. This was in stark contrast to an air of relaxation, even jauntiness, they had all exhibited during break periods on Wednesday and Thursday.

During that lunch, Ford took time out to insist that he had been the victim of entrapment and to express a wish that more time and attention had been devoted to that subject during the trial.

In a brief statement to members of the media after exiting the Federal Building, former Senator Ford, who remains free on bond, expressed disappointment with the verdict.

Although well-wishers for Ford and family members attended the trial throughout, a striking feature of the former senator’s trial was that it attracted less out-of-town media contingents and fewer demonstrators than had a previous one for Ford’s former state Senate colleague, Roscoe Dixon.

Dixon was convicted of bribery and extortion charges last year and is now serving a term in federal prison. Another local figure,former Shelby County Commissioner Michael Hooks Sr., pleaded guilty to similar charges and has yet to begin his term.

Tennessee Waltz indictees yet to be tried include former state Senator Kathryn Bowers and fortmer Memphis school board member Michael Hooks Jr.

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Opinion

Miami Vice

What happens in Vegas stays in Vegas, but what happened in Miami in 2004 during three days and nights of partying involving John Ford, an undercover FBI agent, and their dates was courtroom fodder this week in Ford’s corruption trial.

Ford’s girlfriend, Mina Nicole Knox, 26, took the witness stand for nearly two hours as the defense closed out its case in short order. Ford did not testify, and the defense presented only three witnesses, including Knox, attorney Allan Wade, and Ford’s friend William Watson.

At Flyer press time, prosecutors were undecided whether to call a rebuttal witness. Otherwise, U.S. district judge Daniel Breen said the two sides would make closing arguments Tuesday afternoon and the case could go to the jury after that. The trial is in its third week.

Knox, who described her relationship with Ford as “personal,” is a petite former model and professional cheerleader and aspiring actress. She answered questions in a sweet, perky voice as defense attorney Michael Scholl and assistant prosecutor Lorraine Craig asked her about details of her weekend with Ford, Tim Willis, and undercover agent L.C. McNeil in Miami in July 2004. The weekend included a party aboard the now famous E-Cycle yacht, which was in fact an FBI prop, where undercover FBI agents smoked cigars, had drinks, and danced salsa with Knox and several of her male and female friends, including Ford.

Under questioning by Scholl, Knox told jurors that McNeil spent the night with one of her girlfriends in a hotel room and a second night with another woman from their party. McNeil testified last week that in his undercover role he “mirrored” Ford’s party style, but he insisted there was no sexual relationship, drug use, or anything “inappropriate” in his role-playing. In real life, McNeil is an ordained minister and specialist in undercover operations who said “it is a challenge to separate the two” lives he leads.

The weekend in Miami is important because it marked the beginning of the buddy-buddy relationship between Ford and McNeil and established the terms by which McNeil would pay Ford $55,000 in what the government says were bribes over the next nine months. Scholl spent more than three days cross-examining McNeil, who made all the payments and recorded them.

When it came his turn to present witnesses, however, Scholl elected to make it short and sweet. Wade, who represents developer Rusty Hyneman, said he never saw Hyneman give Ford an expensive Rolex watch and that Ford did not really save Hyneman any money on a state environmental matter, as Ford boasts on a secret tape. The other witness, a clothing designer who has known Ford for 20 years, also testified about the Rolex.

Then it was Knox’s turn. She said the purpose of the trip to Miami was to attend a black film festival. She did not recall hearing anything about E-Cycle Management. The defense contends Ford was targeted by the FBI and entrapped.

Prosecutors changed tactics by having Craig, instead of assistant U.S. attorney Tim DiScenza, handle the cross-examination. She asked Knox why three versions of the weekend in Miami that she wrote differed in detail, especially about McNeil’s implied romantic involvement. Knox said the first account was written hastily and in broad terms. Her final account of the weekend was written earlier this month just before the trial began. Craig suggested Ford might have coached Knox, but she denied having any help.

Jurors appeared to be listening intently to Knox, in sharp contrast to previous days in which witness testimony dragged on and was often interrupted by private conversations between the judge and lawyers. The courtroom was also unusually crowded with Ford supporters.

After Knox testified, there was a bench conference, after which Breen announced that the proof was complete unless the government decided during the lunch break to produce a rebuttal witness.

The anti-climactic end of the testimony left spectators and reporters guessing about the outcome and offering their opinions about the high and low points of the trial. With Ford declining to take the stand, the role of star witness must fall to either McNeil or undercover informant Tim Willis.

McNeil got the most face time, and the tapes of his payoffs to Ford were devastating, but for my money the trial’s most dramatic testimony came from Willis when he recounted his visit to Ford’s office in February 2005.

Willis was nervous, very nervous.

He had just gotten a call from Ford asking him to come to Ford’s office in downtown Memphis.

The call was short. Ford wanted to talk about one of Willis’ clients. Since Willis had only one client — E-Cycle Management — he could imagine what Ford was going to ask him: Are you working for the FBI?

Say what you will about Willis, he kept Operation Tennessee Waltz alive for three more months until the unveiling of the indictments on May 26, 2005. His commentary from the witness stand on the tape in which Ford threatens to shoot him was the signature moment in the trial.

The meeting at Ford’s office was Willis’ finest hour as an undercover informant. He outfoxed the fox in his own office, nervously shifting a miniature hidden recording device from one pocket to another while making up stories to counter each of Ford’s probes and keeping his nerve when Ford threatened to shoot him if he found out he was being betrayed.

At the time, Tennessee Waltz had been running for 15 months. Ford had been under suspicion since at least April 19, 2004, and had taken $40,000 in payments from an undercover FBI agent. Ford’s Memphis office was on the second floor of a small building on Third Street, with no easy access or interior observation points for FBI agents. Willis was on his own.

“I had a funny feeling about the call,” he testified.

So he called FBI agents Brian Burns and Mark Jackson, who told him to go ahead and to take a recorder with him.

After they talked awhile, Ford got down to business. How well did Willis know L.C. McNeil, the E-Cycle executive who had been paying Ford? What kind of contract did Willis have with E-Cycle? Was it for two years or three years? Where else did the company do business besides Tennessee?

“I’m just trying to figure out why they need a bill,” said Ford.

Then the big question: “Are they legit, man?”

Ford said Roscoe Dixon and two other unidentified people had warned him to be careful. Unknown to Ford, Dixon, hired a month earlier by Shelby County mayor A C Wharton as an administrative assistant, had been secretly taped for more than a year and had already been caught taking bribes from Willis. But Willis did not pay any bribes to Ford and testified that he didn’t even know Ford had been bribed when he went to his office that day.

To each question, Willis made up an answer. E-Cycle, he suggested, was a shell company for a get-rich-quick stock scheme. McNeil and his partner Joe Carson “hated each other,” and McNeil might be trying to sabotage the deal. McNeil grew up on the rough side of Chicago and might have been a drug dealer as a kid.

Ford wasn’t satisfied. The FBI has a lot of shell companies too, he countered.

“Let me ask you,” he said to Willis. “You ain’t workin’ for none of them motherfuckers?”

Ford whispered that he had a gun and said he would use it. Willis, as he had done several times before, broke into nervous laughter.

“He said he would shoot me dead and go tell my wife that I ran off with another woman,” he testified.

Ford was on the right trail but was missing enough pieces that Willis was able to talk his way out of the jam. The truth was worse than Ford suspected. McNeil was an FBI agent and instructor in undercover operations.

“The feds ain’t cut no deal with you?” Ford asked Willis, who had worked in his campaign in 2002.

In fact, that is exactly what they had done. Willis nervously shifted the recorder around in his pockets, sending static through the audiotape played for the jury.

As Willis was leaving, Ford threatened him again, telling him that if he was working for the FBI, “you gonna die right now.” He touched Willis on his shirt — Willis described it as a pat down — to see if he was wired, and Willis lifted up his shirt. As Willis walked down the stairs, Ford said, “It will not ever come back what you and I said.”

Little did he know that Willis would make it all come back. For the next three months, he never met with Ford again without an FBI agent in the room.

“We almost shut down the operation because of the threat,” Jackson testified.

Since he began cooperating with the government in 2003, Willis has been paid approximately $215,000. But on that day in February 2005 in Ford’s office, Willis was worth every dollar the government paid him.

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Opinion

Analyzing the Ford Trial

The government “can’t just go trolling for public officials, can they?”

The answer is “absolutely not.” FBI agent Brian Burns said that from the witness stand in John Ford’s trial in response to a question from defense attorney Michael Scholl, just like he said it from the witness stand in Roscoe Dixon’s trial last year in response to a question from assistant U.S. attorney Tim Discenza.

So when the FBI and federal prosecutors set up Operation Tennessee Waltz to root out “systemic corruption” in state government in 2003, they did not target John Ford. And when Captain Quint and Matt Hooper and Chief Brody set out in that fishing boat and started chumming the waters in Jaws, they were not looking for a big shark.

Seven days into the Ford trial, the case for entrapment is as murky as the case for bribery is clear. Jurors have seen and heard tapes of 10 payoffs to Ford, totaling $55,000, in 2004 and 2005. Each one is made in the context of conversations about Ford helping undercover FBI agents posing as business executives get special legislation for E-Cycle Management. Undercover agent L.C. McNeil counts out stacks of $100 bills and passes them across a desk to Ford, who often puts them in his pocket without bothering with an envelope. Some of the videos are shot from multiple angles and are as clear and carefully analyzed as NFL football replays, with McNeil, à la Boomer Esiason, circling the money with a red marker on his computer screen.

“I can walk into a room and get more done than 10 motherfuckers,” Ford says on one tape in a typical example of the former senator’s bravado and ratiocination. Obscenity may be edited out of family newspapers but not federal trials.

The prosecution’s biggest problem is probably also Ford’s best hope: showing that it caught Ford without setting him up. In the current news climate, with the Justice Department and U.S. attorney general Alberto Gonzales under fire for the firing of eight federal prosecutors, possibly for political reasons, establishing that Tennessee Waltz was nonpartisan is especially important.

Here’s an overview of the trial as of Tuesday, April 17th:

Who’s on the stand? Undercover FBI agent L.C. McNeil (not his real name) has been on the stand for most of four days. He was Ford’s running buddy in 2004-2005 and taped hundreds of hours of conversations. He is the government’s key witness because he actually made the payoffs to John Ford in a way that, in hindsight, seems like a dead giveaway to an undercover sting.

“I don’t target anyone,” McNeil said in response to a question from Discenza. “My focus is to go out and conduct a fair and balanced investigation.”

In two days of cross-examination, Scholl has done everything but shout “liar liar pants on fire” in numerous efforts to get McNeil to depict acting as lying.

Who is L.C. McNeil? The short answer is undercover specialist who looks like he could kick anyone in the courtroom’s ass. The long answer is more complicated. In real life, he is 39 years old, African-American, 6’1″, 220 pounds, a former Los Angeles policeman, a graduate of Oral Roberts with a theology degree, and a former full-time minister who was still ministering last year. For some reason, the government got McNeil to divulge most of that information in the Dixon trial but only gave the Ford jury an abbreviated resume and let Scholl flesh out the details.

In his fake identity, McNeil was the single father of a son in Chicago, a music producer and investor in lucrative stock offerings, and a world traveler. On the tapes, he and Ford are partying, talking about women in language that would get a budding Don Imus in trouble, and going to sports events. But McNeil is not nearly as foul-mouthed as Ford. He calls Ford “cat” and “doctor” and almost always ends his phone conversations with “Peace.”

Does he ever slip up? It’s hard to say, but there seems to have been a close call or two. McNeil always refers to his fellow undercover FBI agent Joe Carroll (alias Joe Carson) as simply “Joe.” Inevitably, Ford says something like “who?” And McNeil says, “My partner.” But he never uses his full name, which is perhaps too easy to confuse with his real name. And his fake career in music and movies, by coincidence or design, put him in Los Angeles and New York at the same time that one of Ford’s daughters was trying to break into the business there. He even says he will contact her, but apparently he never did. Nor did Ford check him out, which might have blown the cover.

Was John Ford targeted? At some point, he obviously was, but when and how are key issues in the trial. The FBI and prosecutors had to comply with guidelines for undercover operations and get approvals from higher-ups in Washington. Given the notoriety and history of the Ford family, it seems likely that Gonzales or his predecessor were in the loop, but that has not come out in court.

The jury must decide whether Ford was “predicated” or predisposed to take a bribe or entrapped by overzealous FBI agents. That’s the reason why so much has been made of an April 2004 dinner at Morton’s Steak House in Nashville when Ford and McNeil met for the first time. Kathryn Bowers, who definitely was an early Tennessee Waltz target, arranged the dinner and E-Cycle paid for it.

“I got a brother on City Council and another brother on County Commission and I control the votes in both places,” Ford says. But he was not an eager player. In his cross-examination of McNeil, Scholl played a tape on which Ford said he was too busy to help.

“It takes five months of my time, and I just don’t have time to do it,” he says.

The next day, McNeil and Tim Willis, his undercover informant, visit Ford at his Nashville office in the legislative plaza. Ford wants to talk more about the music business, but McNeil wants to talk about E-Cycle.

“Do you think we’re in good position to do some things?” he asks.

Three months later, Ford travels to Miami to meet Willis and McNeil, supposedly for a black film festival. He gets a tour of E-Cycle’s yacht and an earful of Willis blabbing interminably on his cell phone at lunch one day. Scholl’s tapes, in contrast to the government’s tapes, present Ford as quiet and mainly interested in the music business and women.

The man who came to dinner: The government wants to start the Ford story at the dinner at Morton’s. Ford came to the dinner, apparently without a personal invitation. Other legislators did not. Bowers, like Ford, is a black Democrat from Memphis. The road through Bowers and Dixon, another early target, would logically lead to Ford.

Ford’s self-assessment as political godfather was not shared by everyone. In tapes played at Dixon’s trial, Dixon says to E-Cycle executives that “we’re all leaders in the Senate.” And Bowers says, “The Senate didn’t have no leaders.” Also, Barry Myers, a Dixon understudy who testified against him at trial, says on tape that the powerful Sidney Chism-Willie Herenton Democrats “don’t give a fuck” about the Fords.

What are the risks of the entrapment defense? It’s a chess game, and prosecutors can counter with evidence such as the Rolex watch gift from developer Rusty Hyneman to Ford to bolster their predication argument. It is still early in the trial, and Discenza likely has more witnesses and more evidence that he might not have been able to put before the jury without the entrapment defense. There has already been testimony that Ford was involved in three previous FBI investigations.

Could the bribes be construed as legitimate? The intent is as clear as the video quality. McNeil always brings the conversation around to E-Cycle legislation so there is little, if any, chance of the payment being depicted as a legitimate consulting fee. Ford, of course, drives home the nature of the payments by playing the part of the dutiful legislator in the early tapes and, in the later tapes, threatening anyone who rats him out.

So, it’s a slam-dunk case? Never. That’s for the jury to decide.

Where’s Tim Willis? In the wings. The government will have to put him on the stand to talk about the witness-intimidation charge against Ford. He will take his standard beating from the defense (this will be the third trial in which he has testified) and will be questioned sharply about his moviemaking, which could suggest that he saw the whole thing as a sort of “Tim’s Excellent Adventure” project to advance his career.

Deleted scenes: Like the dozen or so reporters in the courtroom each day, the defense and prosecution are each trying to create a storyline for an audience by selectively choosing quotations, characters, and incidents. Scholl has effectively changed the plotline for now, but his points are sometimes hard to decipher. Discenza works faster and always has his witnesses repeat what he considers to be key statements.

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News The Fly-By

The Cheat Sheet

CREDIT: Greg Cravens

Police arrest a man at a downtown parking garage who was posing as an attendant and taking money from patrons. This makes us wonder: Was he wearing a uniform? Was he standing in the little booth? Where was the real attendant? Did the lot even have a real attendant? We’ve considered giving out awards for the city’s best con job, since we’re seeing so many of them lately, but we really don’t want to encourage this kind of behavior.

As part of its Tennessee Waltz Greg Cravens

sting, the FBI gathered 57 videotapes of former senator John Ford saying some very interesting things to informants. In one video, Ford tells an undercover agent posing as a businessman that he can get him Grizzlies tickets anytime he wants and offers this odd reassurance: “I got your back. I got your front. I got your injured knee.” The agent did indeed have a knee injury, but when one grown man tells another grown man, “I got your front,” we say, back away.

In more Ford news — this time involving Edmund, not John — the city councilman wants it clear that during an argument about his select treatment by Memphis Light, Gas and Water, he supposedly told Carol Chumney, “Don’t make me your pawn” instead of “Don’t make me your punk.” Oh yes, that’s much better.

The good people of Walls, Mississippi, are offended when a private club erects a series of billboards along Highway 61. The first one reads, “Got Beer?” and the second one beckons, “Got Boobs?” We won’t say where you would go for the beer, but Walls should consider itself fortunate. For all the boobs you need, just keep driving to Memphis and look at the long list of civic leaders caught in the Tennessee Waltz scandal.

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Opinion

The Big Dance

The government showed its Tennessee Waltz playbook in the Roscoe Dixon trial last year, but prosecutors face a few more obstacles as they try to convict John Ford.

The X-factors include Ford himself, his attorney Michael Scholl, bagman Barry Myers, controversial U.S. attorney general Alberto Gonzales, and the Justice Department’s public corruption prosecutors in Nashville, who have Ford under a separate indictment.

In many ways, of course, the trials will be more alike than different. Prosecutor Tim DiScenza will play obscenity-laced audio and videotapes of Ford wheeling and dealing with an undercover FBI agent pretending to be an executive of E-Cycle Management. The payoff picture will be shown from different angles. Jurors will hear how the phony company was created and the role played by informant Tim Willis. Willis and the FBI agents who pretended to be free-spending E-Cycle executives will testify.

But Ford is an iconic name in Memphis politics, and he was a genuine leader in the Tennessee Senate. Dixon, on the other hand, was a plodder and secondary figure even in the estimation of his friends. He bumbled through an appearance on the witness stand, and his lame alibi and inconsistencies made him easy prey for DiScenza. The shrewdness that made Ford a self-described consultant with a high-six-figure income could also make him a formidable defendant, whether or not he chooses to testify. His reputation as a big talker given to outrageous overstatements might actually help him fight the three counts of his indictment that accuse him of threatening Willis.

Scholl has the benefit of learning from the trials of Dixon and Calvin Williams, a former Shelby County employee who was also convicted. Dixon’s attorney, Coleman Garrett, opened with the entrapment defense. Dixon went off in another direction when he took the witness stand. Based on pretrial motions, Scholl will apparently argue that Ford considered the money he got from E-Cycle to be a legitimate consulting fee.

The key witness against Dixon was Myers, described as being “like a son” and “protégé” to the senator. Myers, who did not begin cooperating with the FBI until the Tennessee Waltz indictments became public, was the bagman for Dixon and others. On secretly recorded tapes with E-Cycle bigshots, Myers calls Ford “the big juice” and one of the “heavy hitters” in the legislature. But Myers was not as close to Ford as he was to Dixon. As far as we know, Myers was not Ford’s bagman. Nor is some other bagman waiting in the wings to testify against Ford. It appears that Ford did his own collections.

In the year since Dixon went to trial, the political climate has changed. The Justice Department has taken a pounding from Democrats, who now control Congress, and some Republicans. Last month, it came to light that Gonzales was involved in the firing of eight federal prosecutors, including Bud Cummins of Little Rock. A Republican, Cummins said he resented the misstatements about the firings more than the dismissal itself and believes the Justice Department has lost credibility.

Gonzales is due to testify before the U.S. Senate next week, if he survives that long. Ford jurors will be instructed not to read or watch news during the trial, but Scholl may have an opportunity to suggest that Ford was politically targeted as a Democrat.

Dixon jurors were introduced to the concept of “predication” or predisposition to commit a crime. “You can’t go out trolling for public officials, can you?” DiScenza asked an FBI agent, who explained that Tennessee Waltz began as an investigation of Shelby County Juvenile Court. Jurors heard tapes of Dixon and Myers discussing bribes for helping a dental clinic (for which Dixon was not indicted) to show he was predicated.

In the minds of many Memphians, John Ford was predicated by being John Ford — a fast driver and big talker with marriage problems and expensive tastes. But that won’t cut it in court. Prosecutors will have to be careful not to trip over their own colleagues in Nashville.

In 2006, Ford was indicted in Nashville in connection with his “consulting” payments from companies doing business with the TennCare program. The indictment pushed Ford’s trial date back to April to allow Scholl to review hundreds more documents. Nashville prosecutors will only say that their case will follow sequentially the Memphis Ford trial.

(Check www.memphisflyer.com for regular trial updates.)

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Opinion

Politics and Justice

How long do you think it will take the national media to follow the strands of the fired federal prosecutors story to Tennessee? I’d say about two weeks, at most.

On April 9th, former state senator John Ford goes on trial in federal court in Memphis. He’s a big fish in his own right and he’s the uncle of Harold Ford Jr., who is a celebrity, and the brother of Harold Ford Sr., who had his own federal trials in 1990 and 1993. The second trial, which resulted in Ford’s acquittal, was marked by exactly the sort of political meddling in the Justice Department that is now being exposed in the Bush administration.

There are so many good angles it’s hard to cram them all in, but here goes.

Don Sundquist’s name could come up in the John Ford trial because the powerful senator from Shelby County was a go-to guy from 1994 to 2002, when Sundquist was governor. Ford has a May 22nd trial date in Nashville on charges related to consulting.

But there’s much more. When he was a congressman in 1991, Sundquist recommended that Hickman Ewing Jr. be replaced by Ed Bryant as U.S. attorney for Western Tennessee. Ewing and his assistants were on the trail of Harold Ford Sr., who confronted Ewing in an elevator in the federal building in 1989 and told him, “You are a pitiful excuse for a U.S. attorney, but I can guarantee you that you won’t be the U.S. attorney much longer.”

Like the eight fired prosecutors who are now in the news, Ewing was replaced in mid-term. Ewing, Sundquist, and Bryant are Republicans, while Ford is a Democrat. In 1993, Bill Clinton was the newly elected president, and when Democrats in the Justice Department tried to influence jury selection in the second Ford trial, the government’s two trial attorneys resigned, albeit for only a day. So did Bryant, who was going to be replaced anyway along with 92 other U.S. attorneys as part of the new administration.

Sundquist, of course, went on to become governor. In his second term, when Tennessee Waltz was still just a song, federal prosecutors began an investigation of fraudulent state contracts. One close friend of Sundquist, John Stamps, was sentenced to two years in prison in 2005. Another Sundquist friend, Al Ganier, was indicted on federal obstruction charges in 2004. Three years later, he doesn’t even have a trial date. But in a court order in 2005, U.S. district judge Karl Forester wrote that Sundquist was “the impetus” for the federal investigation and said prosecutors had evidence that Sundquist “improperly interceded” on Ganier’s behalf.

Sundquist has not been charged and has said he is confident he is not under investigation. If the phrase “improperly interceded” rings a bell, that’s what has Joseph Lee on the hot seat over at MLGW in connection with another Ford, brother Edmund.

Meanwhile, federal prosecutors in Memphis and Nashville who were there at the start of the political corruption investigations have moved on. In Memphis, Terry Harris took a job with FedEx. In Nashville, Jim Vines resigned in 2006, and first assistant Zach Fardon left in January.

Will Attorney General Alberto Gonzales resign? He apparently lied about what he knew about the firings and when he knew it. Lying can be criminal. It was one of the factors that got Roscoe Dixon such a harsh prison sentence, and it’s one of the charges against Michael Hooks Jr., scheduled to go to trial later this year.

The bumbling of the Justice Department has been criticized by, among others, Bud Cummins, former U.S. attorney in Arkansas, who was fired last year to make room for a pal of Karl Rove and then smeared by his old bosses. Two years ago, Cummins, a Republican, staunchly defended Gonzales and President Bush.

If Republican prosecutors are upset, how do you suppose Democratic pols feel about being seven times as likely as Republicans to be indicted? A suggested opening argument in the John Ford trial: “Ladies and gentlemen, in the 1996 presidential election, Memphis delivered Tennessee, whose electoral votes clinched it for Clinton/Gore. The Republicans and Karl Rove never got over it, and Mr. Ford is the victim of a political vendetta by a Justice Department whose leadership lies.”

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News The Fly-By

Watching the Evidence

The diamond-studded Rolex is ticking away the days until former state senator John Ford’s federal trial for bribery.

Judge Daniel Breen heard arguments for and against the admission of Ford’s Rolex wristwatch as evidence in the federal government’s bribery case against Ford in a motion hearing Tuesday afternoon in U.S. District Court.

The watch is an extremely rare model, with a meteorite face encircled in diamonds. Rolex values the piece at $46,800. Ford defense attorney Michael Scholl inspected the watch in court and gave Ford another look at it.

Ford openly discussed the watch during a taped conversation with undercover FBI agents during Operation Tennessee Waltz. In the conversation, Ford revealed that developer Rusty Hyneman gave him the watch after Ford saved Hyneman $1.3 million with a “big favor.” Ford estimated the value of the watch at $50,000 on the tape, claiming, “I paid zero.”

Scholl possibly previewed his defense strategy for the trial, as he focused on the boasting that his client and undercover agents engaged in during their transactions, suggesting that Ford merely talked big to impress his company.

Scholl played the court a tape of an undercover FBI agent on the case encouraging another to “have some fun [with Ford], and if we catch him, we catch him.”

The defense also played tape of Ford explaining his purchase of a Rolex to one of the agents, which calls the veracity of Ford’s “I paid zero” claim into question.

Scholl similarly depicted his client’s claim of having saved Hyneman over a million dollars in state levied fines as another case of willful inflation.

FBI agents arrested Ford on May 28, 2005, in Nashville, and seized the watch as evidence. Scholl initially charged that the confiscation was illegal.

“This is irrelevant to the trial,” Scholl commented, adding, “This is designed to confuse the jury from the real issue.”

The real issue is the indictment, and Scholl stated that “nothing in the indictment alleges anything with the watch.”

The pre-trial hearing marks the final court action prior to Ford’s trial, scheduled to commence April 9th.

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Opinion

Another Ford Indictment

John Ford was United American Health Care’s rainmaker.

Back in 2000-2001, the Detroit-based company that manages health care for Medicaid patients was in the ditch. Its publicly traded stock (symbol: UAHC) was selling for around $1. Business was lousy. It was about to lose its management contract with the state of Michigan. Then the company found financial salvation via a lifeline to Memphis and Nashville through Ford.

Using the time-tested Memphis practices of cronyism, strong-arming the state Senate, turning low-income Ford voters into revenue-generating customers, and — according to a new federal indictment — corruption, Ford helped turn UAHC around.

By 2002, UAHC was enrolling thousands of new members, most of them coming from Tennessee’s TennCare plan. Its headquarters was still in Detroit, but its business was in Memphis and West Tennessee. Operating as OmniCare, the CEO was Ford’s friend Osbie Howard, who was city of Memphis treasurer from 1992 to 1995 under Mayor Willie Herenton and Herenton’s campaign treasurer in 1999. Another key executive was Stephanie Mebane Dowell, formerly Herenton’s administrative assistant and later legislative director for Methodist Le Bonheur Healthcare until 2001.

Things were rosy for a few years. The stock soared to $7 a share. Howard was earning over $300,000 a year and had 83,000 shares of stock and options on 130,000 shares. Ford was secretly collecting “consulting fees” from UAHC of $10,000 a month, totaling more than $400,000 by 2005.

But that was the year the roof caved in. Two OmniCare employees, including in-house attorney Felicia Corbin Johnson, blew the whistle on illegal acts in civil lawsuits. Federal investigations targeted Ford’s ties to OmniCare and other HMOs and, in a separate investigation, bribes he allegedly took from an FBI undercover company called E-Cycle Management.

Howard resigned, and UAHC publicly admitted he was “involved” with Ford in a partnership called Managed Care Services Group (MCSG) that was “not approved by UAHC and [was] not consistent with UAHC’s code of conduct.” The stock price plunged from $6 to $2. A few weeks later, Ford was indicted for the first time.

The new indictment, released Monday in Nashville, charges Ford with wire fraud and concealing his so-called consulting work for TennCare contractors. Howard is not mentioned by name, but the indictment refers to an “Individual B” described as “a high-level executive with UAHC, with United American of Tennessee and with OmniCare and also a 30 percent owner of MCSG.”

Howard could not be reached for comment. In the 1999 Herenton campaign, he was pleasantly low-key and accurately predicted that the mayor would get about 46 percent of the vote. Among the losing candidates was Joe Ford, John’s brother. That Herenton campaign, managed by A C Wharton, was notable for the amount of money spent — more than $800,000 — in a fairly short time in a race that was not close.

According to the indictment, John Ford, as an influential senator and a member of the TennCare Oversight Committee, was the key to the growth of OmniCare, and OmniCare was the key to the growth of United American Health Care. With Ford’s help, OmniCare enrolled more than 100,000 uninsured West Tennesseans in its managed-care network.

“After November 1, 2002, substantially all of UAHC’s revenues were derived from its ownership of, and provision of services to, OmniCare through UAHC’s wholly owned subsidiary,” the indictment says. U.S. attorney Craig Morford said it shows Ford’s “appalling willingness” to use his public position for personal gain.

Ford was scheduled to make an initial court appearance this week.

According to recent financial filings, UAHC’s business plan is basically unchanged. It plans to “grow business in Tennessee” where it has 115,000 members and relationships with 19 hospitals and 900 doctors. Dowell is chief executive officer of UAHC Health Plan, OmniCare’s successor.

For the first quarter of fiscal year 2007, UAHC had revenues of $4.2 million. Last week, four days before the indictment was unsealed, UAHC successfully completed a private placement of new shares of stock, raising $6.5 million. The stock was selling this week at slightly under $9 a share.

The other company mentioned in the latest Ford indictment is Doral Dental. Again, the parent company is conveniently based out of state (Wisconsin) where its ties to Ford were less likely to be scrutinized. Doral Tennessee had the TennCare dental contract, thanks to Ford, and allegedly paid him more than $400,000.

Whether or not they knew all the details, Ford’s senate colleagues were aware of his consulting business (he listed consulting as his occupation in the Tennessee Blue Book) and the fortunes being made in the stock market. Some were apparently envious. In secret tapes played at his bribery trial, former Senator Roscoe Dixon talks about the subtleties of steering business to certain dentists and HMOs and says “everybody got some semi-hustle.”

The whole premise of phony E-Cycle Management and Tennessee Waltz was high-rollers using lucrative state contracts to boost their revenues and credibility and make a killing in the market. And the template was real companies such as UAHC and Nashville-based Corrections Corporation of America.

The Flyer erroneously reported last week that Southland Park Gaming and Racing is owned by Penn National Gaming. It is owned by Delaware North Company.

Categories
Opinion

Waiting Game

After Roscoe Dixon’s sentencus interruptus last week, television reporter Mike Matthews asked the former senator how he was holding up financially. Dixon admitted he was feeling some strain and joked that Matthews might want to buy him lunch.

While Tennessee Waltz defendants are feeling the strain, cooperating witnesses are feeling no pain. Foremost among them are Tim Willis and Darrell Catron, who have been living large since they began cooperating with the FBI in 2003.

Catron, who lost his job in the Tennessee Waltz scandal and an inexpensive house to foreclosure, bought a new, $265,000 house in April, according to public records. Catron could not be reached for comment. U.S. attorney David Kustoff would not discuss whether Catron, who lost his county job in 2001, is being paid by the FBI.

Catron’s friend and partner in crime, Tim Willis, has been getting at least $6,000 a month plus expenses from the FBI, according to testimony in Dixon’s trial. Secretly recorded videotapes played at the trial showed the natty Willis driving an expensive car and entertaining Dixon and other visitors at his home in Harbor Town. Willis, who went undercover posing as a lobbyist for the sham company E-Cycle Management, has even been making an indie movie about his adventures.

Well, undercover work is tough, potentially dangerous (serious or not, John Ford can be heard on a secret tape threatening to kill Willis if he double-crosses him), and requires a high degree of skill. Willis has shown his chops on tape and on the witness stand. We’ll see about Catron.

But the contrast between the lifestyles of cooperating witnesses and stonewalling defendants is stark. Dixon had to give up a $100,000 a year job as an assistant to Shelby County mayor A C Wharton. Senator Ward Crutchfield of Chattanooga gave up a job last year as attorney for the Hamilton County school board that, according to secret audiotapes, paid him $150,000 a year. John Ford gave up his Senate seat and lost his license to sell insurance. Kathryn Bowers gave up her Senate seat and was arrested for DUI this summer. Michael Hooks Sr. resigned from the Shelby County Commission and appeared abject as he changed his plea to guilty. His son, Michael Hooks Jr., faces trial and has blown a once promising career as a consultant. All of the defendants face mounting legal bills and prison sentences if convicted.

Catron, on the other hand, has not been sentenced, and Willis, who previously did prison time on a credit-card conviction, is a free man after he finishes testifying.

Dixon will be sentenced October 13th. Judging from the large number of Dixon supporters, feds, and audio-visual specialists in the courtroom at last week’s aborted session, both sides are preparing to do some rehashing, even if it is unlikely to influence super-attentive U.S. district judge Jon McCalla. Next up, on November 6th, is Calvin Williams, charged with extortion and bribery while serving as a county employee. He has promised (threatened?) to write a book about his experiences as a young black Republican activist and former chief administrator for the Shelby County Commission. He now has a low-level county job and is represented by the federal public defender. On his way out of the federal building last month following a court appearance, he vowed, “I will not be a Roscoe Dixon. I wouldn’t go to trial if I didn’t have a defense.”

And the government, we can assume, wouldn’t try him if there weren’t a case, although the indictment doesn’t spell out exactly what he supposedly did. In 2005, he and former Juvenile Court clerk Shep Wilbun were standing outside a courtroom, literally minutes from going to trial on state criminal charges, when the special prosecutor suddenly and inexplicably dropped the case.

The Williams trial could feature Willis in a reprise of his starring role as accuser. Call it “The Clash of Brash” — the tell-all author Williams facing the tell-all filmmaker Willis. In a Flyer interview before his federal indictment, Williams said he and Willis were friends and business partners at one time but fell out “because [Willis] had too many people with their hands in the cookie jar.”