The National Attorneys General Training & Research Institute

The National Attorneys General Training & Research Institute The National Attorneys General Training & Research Institute

CEPI Newsletter September 2018

This monthly 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 express a view as to the accuracy of news accounts or affirm any position taken by the authors of the hyperlinked articles.

Cases

State

Court of Criminal Appeals Upholds Auburn Republican Mike Hubbard's Conviction on 11 of 12 Charges: The Alabama Court of Criminal Appeals has affirmed the conviction of former Alabama House Speaker Michael Hubbard, who was convicted in June 2016 of a variety of charges related to his violation of the Alabama Ethics Law. Hubbard, who helped pass those very same ethics laws, argued—among other things—that the laws were unconstitutionally vague.

AG Steve Marshall Announces Sentencing of Former Health Dept. Employee to Suspended 10-Year Sentence for Felony Ethics Violation: A former Administrative Assistant for the Alabama Department of Public Health, who pled guilty to stealing over $15,000 from the state by falsifying travel vouchers, has been sentenced to four years of supervised probation and ten years in prison (which were suspended), and has been ordered to pay restitution.

Ex-Valley Metro CEO Stephen Banta Pleads Guilty to Fraud 3 Years After 'Republic' Inquiry: Following charges brought by the Arizona Attorney General’s Office, former Valley Metro Chief Executive Stephen Banta pled guilty to fraud. Banta was charged with using public funds to pay for extravagant personal travel and dining. His acts were originally uncovered by reporters who discovered that he routinely few first class and stayed in $600-a-night hotels.

Ex-Quartzsite Police Employee Pleads Guilty to Stealing Cash: Christy Conley, a former evidence technician for the Quartzsite, Arizona, police department, has pled guilty to stealing about $20,000 in cash from an evidence safe in 2017. In an effort to hide her crime, Conley also set fire to the evidence room.

AG: Employee Charged with Stealing $139,000 from School District: The Arizona Attorney General’s Office has indicted the former business manager for the Western Arizona Vocational Education District, Deborah Long. Long is accused of stealing more than $139,000 from the district over a nearly 5-year period.

MBTA Worker Repairing Fare Boxes Now Accused of Stealing $450,000, Authorities Say: Former Massachusetts Bay Transit Authority automated fare technician Stephen P. Fagerberg is alleged to have stolen $450,000 from fare boxes he was charged with repairing. The loss amount is a result of additional investigation done by the Massachusetts Attorney General’s Office after his June arrest, when it was believed he’d stolen approximately $80,000 from transit boxes.

Former Monroe County Judge Pleads Guilty in Prostitution Case: In a case brought by the Michigan Attorney General’s Office, former Monroe County Judge Jarod Calkins has pled guilty to hiring women for the purposes of prostitution. According to an affidavit filed in the case, Calkins engaged in non-consensual, violent acts with the women.

Another Year in Prison for Griego: Former New Mexico State Senator Phil Griego, who was previously convicted of other corruption-related offenses after trial, pled guilty to stealing money from his campaign account and lying about that theft on campaign finance reports. Greigo was sentenced to a consecutive year in prison for the new case. Both cases were brought by the New Mexico Attorney General’s Office.

JFK Supervisor Took Bribes, Broke Rules to Let Other Countries Park Their Planes Overnight: Prosecutors: Marlene Mizzi, the former assistant duty supervisor at John F. Kennedy Airport in New York, has been charged with receiving a reward for official misconduct. One of her alleged bribers, a Qatar travel coordinator who made arrangements for that country’s United Nations delegates named Joseph Jourieh, was also charged. Jourieh is alleged to have provided Mizzi with meals, limo rides, and a watch. The Port Authority Inspector General warned employees that the agency “would not tolerate violations of the public trust or any other corrupt acts.”

Queensbury Couple Pleads Guilty in Money-Laundering Scheme: Robert J. Mirel and Debra Burnett, former owners of Arlington Manipulators, pled guilty to grand larceny, money laundering, fraud and tax fraud in connection with a long-running scheme to obtain money from businesses without delivering any products. The New York Attorney General’s Office brought the case, which is expected to result in an order of over $1.3 million for restitution and several years in prison for both defendants.

State Sen. Jeff Woodburn Arrested On Domestic Violence, Assault Charges: The Vermont Attorney General’s Office has charged State Senator Jeff Woodburn with domestic violence, criminal trespass, and criminal mischief. Woodburn allegedly hit and bit his partner on multiple occasions, and also kicked in the door to her home and entered without her permission. Although some members of the senator’s party called upon him to resign, he was recently reelected.

Federal

How America Stopped Prosecuting White-Collar Crime And Public Corruption, in Charts: The Washington Post looks at data from federal white-collar and corruption cases to conclude that such prosecutions appear to have dropped substantially.

US Judge off Corruption, Kidnapping Cases After Emails: Central District of Illinois Judge Colin Bruce has been removed from all criminal cases—including the corruption case against ex-congressman Aaron Schock—after it was revealed that he exchanged emails with a paralegal at the U.S. Attorney’s Office prosecuting Schock. Those emails—which the U.S. Attorney’s Office of the Central District of Illinois disclosed to defense attorneys when it discovered them earlier this year—included the judge’s criticisms of federal prosecutors who were trying a case before him. The case has been reassigned to a judge in the Northern District of Illinois—and the U.S. Department of Justice has also reassigned prosecution of the case to Assistant U.S. Attorneys in that district.

Ex-Judge Loses Appeal in Bribery Case: Former Texas state district judge Angus McGinty has, nearly three years after being sentenced to federal prison for taking bribes, lost his appeal. McGinty argued that his defense attorneys urged him not to cooperate with law enforcement because they, too, were implicated in his bribery scheme. The Fifth Circuit concluded that even an unwaivable conflict does not invalidate a conviction where the defendant “knows of the conflict, keeps the district court in the dark, and later seeks to invalidate his conviction based on the alleged conflict.” The court nonetheless suggested that prosecutors should take a proactive approach when they that defense counsel may have a conflict of interest: “We take this opportunity to remind prosecutors that the prudent course in a case like this is promptly and fully to disclose a potential conflict to the district court.”

Former East Chicago Councilman Sentenced to 20 Years Prison for Drug-Related Murder: Former East Chicago City Councilman Robert Battle—who was reelected to a second term while murder charges were pending against him—has been sentenced to 20 years in federal prison. Battle, who was a drug dealer in addition to being a politician, shot and killed a man to whom he owed a drug debt. Less than two months before that murder, Battle had been stopped by federal authorities, who seized over $100,000 of drug money from him. Battle agreed to cooperate with police and promised to inform them if he saw his supplier. Instead, in mid-October 2015, Battle murdered the supplier when the supplier came to his house to discuss the drug debt.

Ethics

Lawyer is Suspended for Flashing Gun at Deposition, Other 'Appalling' Behavior: In Nevada, an attorney has been suspended from the practice of law for over six months after calling his litigation opponent names and showing a gun during a deposition. James Pengilly was representing himself as a defendant in a defamation lawsuit when he called the plaintiff names and gestured to a gun on his hip during a deposition.

NJ Attorney General Creates Office to Investigate Corruption: The New Jersey Attorney General has announced a new Office of Public Integrity and Accountability, which will focus on allegations of civil rights violations, wrongful convictions, and matters involving public officials. The office will report directly to the attorney general.

Wantage Municipal Prosecutor Sanctioned for Misleading Court: A municipal prosecutor in Wantage, New Jersey, has been disciplined with a letter of admonition for violating the state’s Rules of Professional Conduct. William Haggerty admitted that he failed to disclose he was the brother of a utility board’s chairman when he prosecuted a case in which utility board was the “victim” of an individual who tampered with its equipment. Haggerty’s omission resulted in a mistrial in the case after the defendant asked a witness about the relationship between the chairman and the prosecutor.

Faithful Execution: The Persistent Myth of Widespread Prosecutorial Misconduct: In a recent law review piece, an Assistant U.S. Attorney in Tennessee (and former New Jersey Assistant Attorney General) argues that the—to use the words of the now-disgraced former Ninth Circuit Judge Alex Kozinksi—alleged “epidemic” of prosecutorial misconduct is more accurately described as occasional incidents of individual shortcomings among a small number of prosecutors.

A New Panel Can Investigate Prosecutors. They Plan to Sue to Block It.: New York has created an 11-member commission with the power to investigate the state’s 62 district attorneys if it believes their conduct is unprofessional, unethical, or unlawful. The president of the District Attorneys Association of the State of New York has spoken against the bill creating the commission, calling it “flawed and unconstitutional” and warning that the “interference will breed more public corruption and distrust of our public officials.”

Portland Criminal Defense Attorney Suspended for 1.5 Years: Gary Bertoni, a criminal defense attorney in Oregon has been suspended from the practice of law for 18 months after repeatedly “disregard[ing] … the interests of his clients.” The sanction follows his conviction for failing to pay employment taxes.

Prosecutors Worry a New Ethics Opinion is a 'Tactical Weapon': In Tennessee, an opinion issued by the state’s Board of Professional Responsibility in March of this year is the subject of debate by the defense bar and by federal and state prosecutors. The opinion would require prosecutors to turn over all exculpatory evidence “as soon as reasonably practicable,” upon pain of suspension or disbarment. The Tennessee District Attorneys General Conference and the state’s three United States Attorneys have requested that the board withdraw its opinion.

Investigative Tools

The New Frontier: Using Artificial Intelligence To Help Fight Corruption: Our friends at the Global Anticorruption Blog discuss how artificial intelligence tools can be harnessed by both private and public sectors to prevent and uncover corruption.

Navigating Data Privacy for Cross-Border Investigations: In an article discussing the EU’s GDPR, the FCPA Blog notes that some countries have enacted “data localization” laws that require their citizens’ data to be stored within their borders. Such laws are intended to prevent that data from being compromised in other countries and to ensure that it is accessible to the home country’s government if it is needed during, for example, a criminal investigation.

International

Former Colombia Anti-Corruption Chief Pleads Guilty to U.S. Bribery Charges: Luis Gustavo Moreno Rivera, the former Director of Anti-Corruption in Colombia, has pled guilty to soliciting a $132,000 bribe to undermine an investigation into a Colombian politician. Rivera requested the bribe from former Córdoba, Colombia, governor Alejandro Lyons Muskus. Muskus was, unbeknownst to Rivera, a cooperating witness for the U.S. Drug Enforcement Administration; during recorded conversations, Rivera offered to inundate his prosecutors with work so that they would not be able to focus on the investigation into Muskus.

Brazil Police Seize $16m From Equatorial Guinea's VP Delegation: In a sign that he was undeterred by his recent French corruption trial and the forfeiture of $30 million in ill-gotten gains to the United States in 2014, the vice president of Equatorial Guinea, Teodorin Obiang Nguema, attempted to smuggle more than $16 million worth of cash and luxury watches into Brazil. A French court had sentenced Ngeuma to a three-year suspended sentence in October 2017 for money laundering and embezzlement, and ordered the seizure of about $115 million in assets. Switzerland and the Netherlands have also seized items from Nguema, including a $120 million yacht.

Malaysia’s Ex-Leader Najib Razak Is Charged With Money Laundering: Malaysian authorities charged former prime minister Najib Razak with money laundering, in connection with the 1MBD fund (1Malaysia Development Berhad), a sovereign wealth fund that has also been the subject of investigations in the United States and Switzerland.

UK Court Rules KBR Must Turn Over Documents in Unaoil Case: A court in the United Kingdom is requiring the U.S.-based general counsel of KBR to disclose documents in connection with a notice served on KBR by the U.K. Serious Fraud Office (SFO). KBR had claimed that it would not make the documents available to the general counsel and argued that the SFO notice did not reach extraterritorially, but the court rejected both arguments.

U.S. Company Manager Pleads Guilty in PDVSA Bribery Scheme: A Venezuelan official and his U.S.-based briber have both pled guilty to conspiring to violate the Foreign Corrupt Practices Act. Petróleos de Venezuela, S.A. (PDVSA) official Jose Orlando Camacho and Texan Juan Carlos Castillo Rincon are among fourteen people who have entered guilty pleas in connection with the scheme.


Amie Ely is the Director of the Center for Ethics & Public Integrity and the Editor of the CEPI Newsletter and may be reached at 202-326-6041. The CEPI Newsletter is a publication of the National Association of Attorneys General. Any use and/or copies of this newsletter in whole or part must include the customary bibliographic citation. NAAG retains copyright and all other intellectual property rights in the material presented in this publication. For content submissions or to contact the editor directly, please e-mail aely@naag.org.

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