The General Improvement Fund scandal grinds on in federal court in Missouri

The General Improvement Fund scandal grinds on in federal court in Missouri

Gone but not forgotten: The sprawling General Improvement Fund scandal that landed five former Arkansas legislators in prison, home detention or awaiting sentencing for taking payments from a beneficiary of state dollars that they helped obtain.

The legislative felons by name: Jonathan Woods (in prison); Micah Neal (home detention completed, and Jeremy Hutchinson, Eddie Cooper and Henry Wilkins IV (all have entered guilty pleas with sentencing delayed.)

Delayed sentencing, years after the pleas by the former legislators and others, is likely the result of keeping them handy to testify as expected in the last big trial scheduled for Oct. 22 in Springfield, Mo. This is the trial of Tom and Bontiea Goss, formerly the leaders of Soringfield-based Preferred Family Healthcare, which raked in tens of millions in Medicaid and other government money in multiple states, including Arkansas for various services, often related to behavioral health. It was aided in receiving state money and other beneficial treatment by legislators who’ve pleaded guilty to taking kickbacks, illegal campaign contributions, World Series tickets and other favors in return.

Lawyers for the Gosses have been battling the charges since they were indicted more than three years ago, in March 2019.

A flurry of court filings this week indicates the fight is still on and, so far, the Gosses are losing. The Gosses’ lawyers filed a batch of motions objecting to a federal magistrate’s recent refusal to dismiss charges against them based on a variety of legal arguments, such as the failure of the prosecutors to disclose certain information and improper use of Grand Jury material.

One objection is of particular interest, because it goes to the heart of the legislative bribery allegations related to the General Improvement Fund, particularly payments to Jonathan Woods, Jeremy Hutchinson and Henry Wilkins, all then senators, funneled through lobbyist Rusty Cranford, who has also pleaded guilty and is now serving a prison sentence at home thanks to a pandemic-related release from prison.

The key argument:

No matter if a district or an agency distributed it, individual legislators lacked any legal authority to decide who ultimately received GIF or how much they received. Like anyone else, the legislators could support applications; nothing more. The authority to choose which applicants received funds from GIF, and how much they received, rested with the district or agency tasked with allocating the funds.

The magistrate didn’t buy it, seeing the distribution of money by state agencies — a division of Human Services or economic development districts — related to the state itself. In practice, we know that the legislators’ recommendations were effectively binding on the state agencies.

The Gosses’ motion argues that mere recommendations by legislators on the spending of money that eventually reached the Gosses’ businesses didn’t constitute an “official act” as the bribery statute requires. Also, it argues, that the benefits legislators received didn’t come until after certain official acts, such as voting on legislation. The motion argues:

To show that a thing of value was promised or given to an official in exchange for an official act, the alleged offer or gift must occur before the official performed that act.

They contend, too, that a Virginia case provides that the government must prove a specific quid pro quo — payment for a specific act, to sustain the charges over the bribes.

It is not enough to allege a legislator agreed to take beneficial action; the agreement must identify the precise “question or matter” that the legislator agreed to influence.

These arguments have been made with varying degrees of success in courts around the country trying public officials on bribery charges. So far, however, no headway for the Gosses in Missouri.

You can read more about this theory here.







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