Originally appeared on the Alabama Political Reporter website
Many within the legal community say that $221,610.77 is just so much spare change for the services of White and company. So, it may be that Hubbard is using campaign funds to supplement the actual cost of White’s services.
Some suggest that Hubbard is paying his legal fees in violation of the 2002 Attorney General’s opinion. The opinion by former AG, Bill Pryor, states that “Excess campaign funds may be used by an incumbent office holder to pay legal fees incurred pursuant to the defense of a criminal indictment if the indictment is related to the performance of the duties of the office held.”
One of the key phrases is, “pursuant to the defense of a criminal indictment.” Hubbard and his attorneys have steadfastly maintained that their work was related to an investigation of those who were disparaging Hubbard and his family. Critics argue that if that were the case then Hubbard would not be allowed to use these funds to pay White or Lance Bell because their services are not “legal fees incurred pursuant to the defense of a criminal indictment.” (See article here.)
On August 4, the Alabama political scene was rocked when ‘Politico’ reported findings from a confidential report revealing that Speaker Hubbard in collusion with the Republican State Leadership Committee (RSLC), had funneled over a million dollars into Alabama “improperly.”
The investigation was led by the notable D.C. law firm, Baker Hostetler.
Much of this had been previously reported by the Alabama Political Reporter. However, the Baker Hostetler internal investigation conducted at the request of the RSLC is yet another round of evidence of a still, very hot smoking gun.
The report concludes that Hubbard, along with senior members of the RSLC, violated Alabama law, in an attempt to hide “Toxic” campaign funds through a “one-for-one” money swap.
The 2011 report titled, “Investigation Into Alabama Activity During The 2010 Election Cycle,” was initiated by the RSLC Board of Director, and according to its authors, “Based upon our interviews with RSLC staff and our review of RSLC’s public and private financial records.” The report says that, “it appears that current and former senior RSLC staff, Tim Barnes and Scott Ward in particular, engaged in improper activities that, taken together, would lead an outside observer to conclude that RSLC had made contributions in the name of another. In particular, it appears that RSLC, with Tim and Scott’s full knowledge and approval, entered into an agreement with Mike Hubbard, State Party Chair and Speaker of the House in Alabama, under which Hubbard raised money for RSLC from Alabama donors which RSLC then contributed, on a ‘one-on-one’ basis, back to PACs and candidates controlled or supported by Hubbard.”
The scheme, revealed in the report, alleges that Hubbard raised money for the RSLC, which would then transfer the money back to Hubbard completely cleaned of its original donors (essentially political money laundering).
The report concludes that, “It would appear, then, to an outside observer, that Hubbard was raising money for RSLC that was either politically toxic or in excess of Alabama contribution limits, and then channeling that money through RSLC back to himself in order to get around the governing Alabama campaign finance laws.”
Hubbard however said that he had no deal with the RSLC and did nothing improper.
RSLC Chief of Staff Scott Ward however said, “That Mike Hubbard originally approached him with the one-for-one deal, under which Hubbard would raise money for RSLC in return for which RSLC would contribute the same amount of money back into Alabama.”
Ward told investigators that he took the proposal to Tim Barnes, then CEO of the RSLC, and that they, “agreed to make the deal,” with Hubbard. Staci Goede, Margee Clancy and Ben Cannatti, all staffers at the RSLC at the time confirmed the Ward account.
RSLC CEO Tim Barnes has denied any such arrangement with Hubbard. Following the Baker Hostetler Report, Barnes was terminated by the RSLC Board. The Board terminated Ward as well because as, “Hubbard’s go-between with Tim in making the ‘one-for-one’ deal. RSLC cannot afford to continue its association with him.”
The investigating attorneys believed that the action taken by Hubbard and the RSLC, “implicate violations of two sections of the Alabama Fair Campaign Practices Act: 1) making a contribution in the name of another, and 2) violating the PAC-to-PAC transfer law.”
Another, more interesting accounts of one-on-one money transfers was $850,000 to the Alabama Republican Party.
In 2010, Hubbard also instructed John Ross, his executive director at the ALGOP, to enter into a sub-contacting agreement with Florida based Majority Strategies.
In 2010, the ALGOP at Hubbard direction entered in to a contract with Majority Strategies of Ponte Vedra Beach, Florida, was for $848,687. Majority Strategies, then in turn, sub-contacted the printing of “hundreds of glossy and colorful campaign flyers for GOP candidates,” to a Hubbard business interest Craftmasters Printers, Inc. It is quite possible that the some of the money once cleaned by the RSLC, landed back into Hubbard’s own pockets, which if true could be a felony act of embezzlement.
According to the attorney’s report, the worry for the RSLC was “the question of what might be revealed by any sort of investigation or additional scrutiny as a result of the PAC-to-PAC transfer controversy. By themselves, RSLC’s public financial disclosures appear to raise serious questions about RSLC’s financial activity in Alabama.”
The report focuses heavily on the transfer of funds from the Poarch Creek Indians’ (PCI) casino operation to fund the Republican takeover of the Alabama State House.
The ‘Alabama Political Reporter’ was the first to report that then ALGOP, Finance Chairman, Sen. Del Marsh was the man who approached the Poarch Creek Indians for campaign contributions in 2010. When first reported Marsh and Hubbard denied, that the request was ever made. But after confirmation from Robbie McGee, of PCI, confirmed the request from Marsh, a slow acknowledgement was made by Marsh. Former Lt. Gov. turned lobbyist is also mentioned in the report as a lobbyist for the Tribe and contributor along with the PCI.
The report concludes that the revelation of “toxic” money from the gaming industry would have a devastating effect on the State’s Republican Party.
“If these events are made public, the resulting media frenzy will be a political disaster for Alabama Republicans, a disaster with which RSLC will forever be associated,” the report stated of the alleged scheme.
However, barely a ripple was seen, because the old mainstream media failed to delve into the controversy.
The attorneys who prepared the report also feared the illegal nature of the cleaning of the toxic money, might have been illegal on the part of Hubbard and RSLC.
“These records show, among other things, that RSLC received several hundred thousand dollars from politically-toxic sources in Alabama, including the Poarch Creek Indians, who have sizable casino/gaming interests, and their lobbyist, Steve Windom.” Windom (R) is a former Lieutenant Governor of Alabama and is now a prominent lobbyist.
“The records show that RSLC’s Alabama-registered entity (“RSLC-AL”) made contributions of almost the same amount to PACs controlled or supported by Mike Hubbard. This includes $523,000 in contributions to 136 Years PAC, NET PAC, and Citizens for a Better Alabama; and $850,000 in contributions to the Alabama Republican Party,” the lawyers said of the actions of the RSLC.
They also believed that, “Any journalist or investigator who reviewed these records would conclude, fairly or not, that RSLC made contributions in the name of another at least in part to hide the fact that Republicans were taking money from Indian gaming interests.”
These allegations by the ‘Alabama Political Reporter’ were met with denial, personal attack against its staff, and backlash from radio talking heads. Those same Hubbard faction radio mouth pieces dismissed the Baker Hostetler report on the RSLC relationship with Hubbard as “nothing new.”
Perhaps most troubling according to the RSLC internal report are contributions made to Citizens for a Better Alabama. “The $100,000 contribution to Citizens for a Better Alabama (“CBA”), which is not controlled by Hubbard, is particularly troubling. CBA is not a Republican PAC, and it is highly unusual, if not unprecedented, for RLSC to contribute money to a non Republican group. Worse, CBA appears to be the renamed “Citizens Against Legalized Lottery (“CALL”),” one of the Christian groups through which Jack Abramoff funneled Choctaw Indian-money to help Ralph Reed rally social conservatives against.”
A 2013 report by the Alabama Political Reporter reveled that then Gov. Bob Riley (R) was the driving force behind Citizens for a Better Alabama. (See article here.)
Director for CBA, A. Eric Johnston, a Birmingham-based attorney and anti-gambling advocate, explained in the 2013 story the operational relationship between Bob Riley, Mike Hubbard and his 501c(4). According to Johnston, efforts by then-Governor Bob Riley allowed over a million dollars to flow through his nonprofit, Citizens for Better Alabama, into to the hands of Mike Hubbard. “Someone from the governor’s [Bob Riley’s] office would call and say you’re getting a check for $200,000 and you’re going to get a bill at the same time from [Mike] Hubbard’s deal and you need to pay that, that is what that money is for.”
After aligning with Riley and Hubbard in 2010, CBA raised and spent over $1 million after never receiving over $50,000 in donations in any previous year.
Based on 2010 campaign finances and other records, the CBA was a crucial conduit for passing campaign cash through the 501c(4) into a potentially lucrative aspect of Mike Hubbard’s financial bottom-line.
According to the IRS Form 990 tax return filed by CBA for 2010, the tax-exempt 501c(4) group took in a little over $1 million in donations. Of that amount, $413,750 came from Hubbard’s personal leadership PAC – the Auburn-based Network PAC – between February and October 2010.
Riley’s Gov PAC gave $292,000 and $314,500 was contributed directly to CBA through individuals at Riley’s request.
Johnston said that the money that his organization received was almost entirely for advertising, he said, “Mike was in that business and I thought it appropriate for him to handle it.”
According to the RSLC internal report, “We do not know why RSLC-AL made this contribution, though it appears to have been at Hubbard’s direction. Nor do CBA’s financial disclosures reveal where this money went. In fact, CBA’s November 2010 financial disclosure does not report the contribution at all.”
They also concluded that this revelation, “would cause a political firestorm in Alabama if made public. Both Hubbard and his ally, Governor Riley, have made a political cause out of eliminating non-tribe gaming in Alabama. Now, it would appear to an outside observer that this has been a hypocritical effort funded by Indian gambling interests in order to keep non-Indian casinos out of Alabama. RSLC was reckless in making a contribution to a group historically affiliated with Jack Abramoff.” (See article here.)
Also on August 4, APR reported that: Acting Attorney General W. Van Davis, Miles “Matt” Hart, and Deputy Attorney General Michael B. Duffy provided Moore’s attorneys with: a certified copy of the official transcript of Moore’s testimony before the Lee County Special Grand Jury on January 24, 2014; the substance of oral statements made by Moore to Special Agents with the Alabama Attorney General’s Office; a CD containing two recorded telephone calls between Moore and Josh Pipkin; certified copies of the official transcripts of the two recorded telephone calls between Moore and Josh Pipkin; a CD containing a recorded telephone call between Moore and Jonathan Tullos; a certified copy of the official transcript of the recorded telephone call between Moore and Tullos; phone records from Josh Pipkin; phone records from Jonathan Tullos; and an executed copy of the oath from the court reporter for the Lee County Special Grand Jury
The court documents reveal that the State also has a recording of Moore speaking with Jonathan Tullos, Executive Director at Wiregrass Economic Development Corporation. Tullos has refused to speak with the press, citing instructions from the prosecution.In a recording made by Josh Pipkin, Moore is heard relaying threats that he says he is communicating on behalf of Speaker of the House Mike Hubbard. It can be surmised that Tullos may have made similar recordings of conversations with Moore. The persecution may be using the Tullos recording to substantiate the validity of the threats made by Moore to Pipkin, on Hubbard’s behalf.The State also responded to Moore’s motion to suppress the two phone recordings and transcripts between Moore and Pipkin. This is the first time that the public has been made aware of two phone conversation between Moore and Pipkin.
Alabama Political Reporter was the first to report and release a copy of one of Pipkin’s recordings, while it was suspected that other tapes existed this is the first time it has been confirmed. Moore’s attorneys have argued that the tapes should be suppressed because Moore was in Florida at the time of the phone calls and therefore did not consent under Florida law to Pipkin’s recording of their conversations. However, the conversations were recorded in Alabama and therefore fall under Alabama law, not Florida’s.
The State said, “As an initial matter, the relief Moore seeks is simply not available to him. Courts in Alabama have repeatedly held that recorded conversations are not inadmissible simply because they were illegally recorded.”The State does not concede that both tapes were recorded while Moore was in Florida, and offers this further response, “In any event, the phone calls between Pipkin and Moore were legally obtained. It is irrelevant under Alabama law where Moore was physically located at the time of the phone calls because Pipkin recorded the conversations in Alabama. Since the law in Alabama is that only one party’s consent is required to record a conversation, then the recordings at issue here were unquestionably legal.” (See article here.)
Also in August the Office of the Speaker of the Alabama House of Representatives announced that the Speaker’s chief of staff Josh Blades had resigned. Prior to joining Hubbard in Montgomery, Blades worked for Hubbard when he was Chairman of the Alabama Republican Party.
As Hubbard’s Chief of Staff, Blades was one of the highest paid public officials in the state of Alabama at the princely sum of $109,801 in 2013.
Blades said in a statement, “I will always treasure the experience of working alongside Speaker Hubbard and our entire team, Being a part of the conservative reforms that Republican lawmakers implemented this quadrennium has been an honor and privilege. Now that the term is drawing to a close, however, I feel it is the right time to pursue new opportunities.”
The former Chief of Staff also thanked Hubbard and former Governor Bob Riley: “I am very grateful to have had the pleasure of serving the state I love for almost ten years under two strong leaders and great men in Governor Riley and Speaker Hubbard.”
Speaker Hubbard said, “When I hired Josh, I asked him for a commitment to stay through four legislative sessions, which he has done. Now that the final session of the quadrennium is complete and with a growing family, it is a logical and not unexpected that he consider other options.”
In 2013, according the reports from the Legislative Fiscal Office, the Office of the Speaker spent a whopping $2,257,179, a budget totalling more than the Office of the Governor ($1,187,616) and the Alabama Ethics Commission ($1,822,177).
The Speaker’s general counsel, James Entrekin, was promoted to replace Blades as Chief of Staff. Entrekin was the Chairman of the Greater Birmingham Young Republicans (GBYR) when tapped by Hubbard to join the Speaker’s staff late in 2013.
On August 8, 2014 APR wrote that in February, 2013, we revealed that in 2010, Governor Bob Riley, in conjunction with then Minority Leader Mike Hubbard, funneled money from various PACs, and from the RSLC to Citizens for a Better Alabama, (CBA), to stop bingo-style gaming from becoming legal in the State.
Certain statements made by the group’s founder, A. Eric Johnston, and various suspect actions by Riley and Hubbard, indicate there could be more to this story than just one group’s battle against gambling.
A recently disclosed 2011 investigation by the Republican State Leadership Committee, (RSLC), showed that there were great concerns over donations given to CBA from the RSLC:
“The $100,000 contribution to Citizens for a Better Alabama (CBA), which is not controlled by Hubbard, is particularly troubling. CBA is not a Republican PAC, and it is highly unusual, if not unprecedented, for RLSC to contribute money to a non Republican group. Worse, CBA appears to be the renamed “Citizens Against Legalized Lottery (“CALL”),” one of the Christian groups through which Jack Abramoff funnelled Choctaw Indian-money to help Ralph Reed rally social conservatives against,” the report concludes.” However, it appears that the investigator, nor the RSLC knew that it was Riley along with Hubbard who were in-fact controlling CBA, by proxy.
According to Johnston, Riley and Hubbard not only procured the funds for CBA, they directed where the money would be spent.
Starting in 2009, the Birmingham-based/tax-exempt group became the public face of opposition to Sweet Home Alabama, and the shutting down of legal casinos operated at VictoryLand and Country Crossings. According to archived versions of its website, the CBA – run by Johnston – has “been an advocate for the family since 1991.”
In a 2009 letter penned by Johnston, he denounced the deceptive ads being run for the Sweet Home Alabama plan: “The Citizens for a Better Alabama may not have the millions of dollars it would take to combat these deceptive ads on the airwaves, but we do have the truth on our side.”
Before CBA’s relationship with Riley and Hubbard the group had an yearly average funding of around $40,000. However, in 2010 Johnston would have a million dollars to fight gambling, provided by his white knight Riley.
According to Johnston, when Riley became interested in ridding the State of bingo gambling, he was contacted by the Governor who said he wanted to help Johnston raise money.
“I don’t know why he [Riley] decided to do it [fight gambling] other than it was a propitious time to do it,” said Johnston. “Whatever he was doing was good. He was stopping illegal gambling.”
However, there are some very suspicious activities surrounding Riley and Hubbard funding of CBA. The way in which Riley passed along money to CBA and directed its flow is of particularly interesting.
According to Johnston, “Someone from the governor’s [Bob Riley’s] office would call and say you’re getting a check for $200,000 and you’re going to get a bill at the same time from [Mike] Hubbard’s deal and you need to pay that…that is what that money is for.”
“Hubbard’s deal,” according to Johnston, was a Hubbard business interest.
Johnston describes how money raised by Riley, went directly to Hubbard and that he never actually saw most of the money.
Johnston said that the money that his organization received was almost entirely for advertising, “Mike was in that business and I thought it appropriate for him to handle it.”
Again, a pattern emerges where donations from one group, is given to a third party and then finally back to one of Hubbard’s business interests. In this case, the money was being directed by Riley to Johnston then to Hubbard. Even the so-called small donations would be directed by Riley, “I would be informed by the governor’s office that I would be getting a check for 2 or 3 thousand dollars and we would have ad bills that cost that much,” said Johnston, “and that money would be for those bills.”
According to Johnston, “We ran a zero balance campaign. Whatever money came in was spent, a lot of it was coordinated through Mike Hubbard’s company.”
CBA is a 501(c)(4) nonpartisan non-profit corporation. According to Alliance for Justice, “The tax exemption for 501(c)(4) organizations applies to most of their operations, but contributions may be subject to gift tax, and income spent on political activities – generally the advocacy of a particular candidate in an election – is taxable.”
CBA records show that, $717, 750 of the almost exactly $1,000,000 raised and spent by CBA in 2010 came directly from partisan Republican PACS and campaign accounts controlled directly by Riley and Hubbard. That is 70 percent of all money raised and spent.
Another $100,000 came directly from another Republican PAC – the Republican State Leadership Committee (RSLC) PAC in Washington DC. Again from an internal memo from September of 2011, the RSLC stated that it was “unprecedented” for them to give political money to a non-profit such as CBA.
The total amount of unquestionably partisan Republican political money (as it came directly from GOP political committees) sent to CBA in 2010 totalled well over $800,000 – 80 percent of all money raised.
Of the remaining $200,000 raised by CBA, there were only 11 separate donors. Ten (10) of those donors had previously contributed political money to Riley and/or Hubbard.
According to CBA’s Form 990, almost all of the money spent – over $982,000 – was on advertising. That advertising was purchased by a Hubbard business interest.
Taking Johnston’s statement on spending into the equation, it seems likely that all of the nearly $1 million spent by CBA was spent with companies owned (either wholly or in partnership) by Hubbard.
All of these actions by Riley and Hubbard raise serious questions.
Did Riley and Hubbard hope to hide the fact that Hubbard business interest were receiving large sums from CBA? It would seem that by running the money through CBA, there would be no disclosure that then Alabama GOP Chair Hubbard was getting almost $1 million in personal business from the “anti-bingo” effort on the eve of a major state wide election.
Due to the overwhelming funding of the “nonpartisan non-profit” CBA directly from GOP PACS, was CBA in violation of federal tax law?
Could CBA owe back taxes on the partisan money contributed for political purposes?
It would certainly seem that CBA could be held liable for hundreds of thousands of dollars of unpaid taxes. As the sole officer of CBA, Johnston would be the person who would be held responsible, even if Riley and Hubbard were pulling the strings – as he has indicated in interviews.
Perhaps the more troubling questions are:
Why did the Republican State Leadership Committee send a $100,000 check to CBA after the bingo fight had been ended by disclosure of a federal investigation in April 2010?
Why did Hubbard’s Network PAC direct over $100,000 in GOP political funds to CBA after the bingo battle ended with the announcement of the federal investigation in April 2010?
Why did Hubbard send $75,000 of precious GOP political money from NETWORK PAC to CBA on October 25, 2010 – one week before the November election and at a time when the State GOP He headed needed every penny for last minute campaigning?
Johnston has a long history of opposing gambling in Alabama. It is likely he wanted to help fight gambling expansion; whether or not he knew that he would essentially be handing over his non-profit to Riley and Hubbard is unknown. (See article here.)
The repercussions of all of this have stretched far outside of Alabama’s borders. In August they stretched all the way to Virginia where Republicans are desperate to win the U.S. Senate seat, and hope that that will help the GOP gain back control of the U.S. Senate. Unfortunately Gillespie’s ties to Mike Hubbard are being used against him by his opponents.
On August 6, the Virginia Democratic Party wrote, “A full 48 hours have passed since news broke that while Ed Gillespie was chairman of the Republican State Leadership Committee, the organization conducted an internal investigation into a “risky campaign finance scheme.” It appeared that the RSLC was involved in a plan to move hundreds of thousands of dollars from the Poarch Creek Indian Tribe through the RSLC to the Alabama Republican Party from January 2009 to March 2011. Gillespie, who chaired the organization from January 2010 – January 2014 and received $654,000 in payments from the group, declined to answer reporter questions for the story. Two days later, Gillespie is still silent and has yet to tell Virginians what he knew about the scandal.”
In a press release the VA Democrats said,
“Here are the questions Ed Gillespie should answer to make clear to Virginians what he knew:
1) Was Ed Gillespie aware that, according to their own report, RSLC officials agreed to be a pass-through organization for Poarch Creek Indian tribe donations that were intended to fund the activities of the Alabama GOP?
2) If Ed Gillespie was aware, did he raise concerns about the legality of the RSLC’s involvement or take steps to try to stop it?
3) Was Ed Gillespie aware of other schemes at the RSLC to funnel money in this way?
4) If Ed Gillespie says he did not know prior to the July 2011 press reports, how is it possible that the chair of the organization, being paid $200,000 in 2010 alone, could not know?
5) When Ed Gillespie was presented with the report from the internal investigation, what actions did he take to ensure that similar schemes were not conducted? Did he put in place any new procedures, and if so what were they? Did Gillespie conduct an audit of fundraising operations in other states?
6) As the RSLC’s lead fundraiser, did Ed Gillespie and Mike Hubbard talk during the time frame that they overlapped, and if so, did they ever speak about RSLC fundraising?
7) Why was Ed Gillespie announced as national chairman in 2010, but not legally listed until 2011?
8) Was Gillespie aware of the severance agreement for Barnes? Was he a part of the negotiation? What were the terms?”
Despite Republican momentum and widespread dissatisfaction with the policies of President Barack H. Obama a University of Mary Washington University Poll in late September has Gillespie trailing Democrat Mark Warner 47 percent to 37 percent. How badly is his involvement with Mike Hubbard hurting Gillespie?
On August 18, 2014 the ‘Alabama Political Reporter’ wrote of infighting within the Alabama Attorney General’s Office over this investigation.
Sources from both within and outside of the Attorney General’s Office have confirmed that Luther Strange’s Chief Deputy, Kevin Turner, is orchestrating a plot to remove chief prosecutor Matt Hart from the Lee Country Grand Jury investigation. In this latest effort, it is said that Turner has devised a plan whereby a “personnel complaint” has been lodged against Hart.
“He is trying to poison Hart’s relationship with Luther,” said one individual with knowledge of the inter-working of the Attorney General’s Office.
According to two individuals closely aligned with the AG’s office—who wish to remain nameless—the complaint against Hart has been filed with Charla G. Doucet, Chief of the Attorney General’s administrative division. This bogus complaint is the first step in an administrative process to have Hart reassigned or fired from his position as Chief of the white collar crimes division.
The latest internal coup against Hart is believed to be the result of political pressure from Hubbard, along with former Gov. Bob Riley.
It is believed that Riley is in full damage control mode over potentially damning information that has led investigators to his children, most notably his daughter Minda Riley Campbell.
According to Hubbard’s book, ‘Storming the State House’, in 2010, Gov. Riley’s daughter Minda Riley Campbell served as Governor’s Circle Coordinator and Campaign Advertisement Producer for the ALGOP.
The publication of the leaked internal investigation by the Republican State Leadership Committee, (RSLC), and the subsequent investigation, shows that $200,000 of Poarch Creek Indian, (PCI) gaming money—laundered by Hubbard and the RSLC—was funnelled into Republican State Senate campaigns. It also shows that $50,000 was divided between a Hubbard business interest and SRM Media. The laundered funds received by SRM Media are believed to be payments made to Minda Riley Campbell.
“Bob Riley has brought his full power, which is considerable, to bare on the Attorney General’s Office to ruin Matt Hart, and stop this investigation,” said an individual with close ties to the AG’s office.
Minda Riley Campbell was also instrumental in the growth and development of the Alabama 2014 PAC, which raised millions for Riley and Hubbard’s incumbent protection plan. The Alabama 2014 PAC established by Riley, Hubbard and Senate President Pro Tem Del Marsh, has received close scrutiny due to some questionable donations and expenditures.
Minda Riley Campbell’s husband, James Campbell, is a partner at Bradley Arant Boult Cummings L.L.P., the powerful Birmingham based law firm which boasts of 350 attorneys in its stable. The firm employed Turner before he took his position with the AG’s Office.
Inside the Attorney General’s Office, the effort to sabotage the Grand Jury, by eliminating Hart, is thought to be the work of Strange’s closest ally, Turner.
Turner’s personal cell phone records from mid-March 2014 to mid-April 2014 —observed by the Alabama Political Reporter —show Turner made numerous private calls to Hubbard, Rep. Barry Moore and possibly former Gov. Riley. Turner’s personal cell records show that several calls coincide with the arrest of disgraced lawmaker Rep. Greg Wren and Rep. Barry Moore. Not only does this raise serious ethical questions, it also begs the question, if there are any criminal complications for Turner and others?
Why would Luther Strange’s second-in-command be in such close personal contact with principles in a criminal investigation?
Do these phone conversations point to a coordinated scheme to thwart justice from within the Attorney General’s Office?
Is Turner leaking secret information, planning a strategy, or is there another answer as to why the second highest officer in the State’s Attorney General’s Office is communicating with those under criminal investigation?
Is Turner working in cooperation with Hubbard, Riley and others to stymie the Lee County Grand Jury investigation by removing Hart from the investigation? This is not the first time Turner has tried to hamper Hart’s efforts in the Lee County public corruption investigation.
A few months ago, on a Friday, Turner informed Hart’s staff that he was reassigning Hart to Birmingham and that he would no longer have an office within the AG’s office in Montgomery. Turner ordered the case files for the Lee County Grand Jury kept in Montgomery away from Hart’s new office location, according to sources within the AG’s office.
According to those present, Hart, upon arriving at his office, found a letter informing him of his reassignment. According to sources with immediate knowledge of the situation, Hart, along with W. Van Davis, confronted Strange and the ensuing heated discussion resulted in a reversal of Turner’s orders.
Such a toxic atmosphere surrounded Turner actions that veteran AG Official John Gibbs, resigned his office, according to those close to Gibbs. Turner has been described by co-workers as a paranoid drinker with a mean streak.
As a result of Turner’s actions, the day-to-day workings of the white collar criminal division were transferred temporarily from Hart. He remained the head of the criminal investigation in Lee County and also the Montgomery investigation into Alabama State University, which is being overseen by Fayette County, District Attorney Chris McCool, who was appointed Special Attorney General, after AG Strange recused himself from the ASU investigations. (See article here.)
On August 21 the ‘Alabama Political Reporter’ reported that Wednesday, August 20, was the deadline for arguments to be filed before the State’s Supreme Court in the Barry Moore perjury case.
In July, Moore’s attorneys filed a motion with the Alabama Court of Criminal Appeals asking the court to consider technical legal challenges to the prosecution case against Moore. Under a rarely used statue, Chief Justice Roy Moore and Criminal Appear Chief Mary Windom (who is married to former Lt. Gov. Steve Windom) decided to lift the case up to the higher court, in an effort to expedite the proceedings.
Attorneys agreed that regardless of the outcome in the Criminal Court of Appeal, the matter would ultimately be appealed to the higher court.
Moore’s attorneys argued that W. Van Davis was improperly appointed “Special Attorney General,” and therefore the proceedings of the Lee County grand jury are illegitimate. Therefore, the case against Moore, and by extension Hubbard or others is void.
According to the revision made to Moore’s motion, the Supreme Court agreed to “decide fundamental constitutional issues affecting the jurisdiction of the ‘special grand jury’… and the extraordinary recusal by the Attorney General of Alabama.”
Moore’s attorney Bill Baxley arguments were thoroughly rejected by Lee County Circuit Court Judge Jacob A.Walker III in June.
Former Lt. Gov. Baxley tried to convince Judge Walker that Attorney General Luther Strange did not have the authority to appoint W. Van Davis, as his representative in the Lee Country investigation.
Judge Walker dismissed that argument saying, “The Court accepted an in camera document from the State, which supports the position that Mr. Davis was appointed by the Attorney General to assume oversight of a legislative corruption investigation on or around January 31st, 2013, as well as any criminal matters arising from that investigation. Furthermore, the letter informs Mr. Davis that the chief of the special prosecution division will report directly to him. These actions appear to be supported by the authority of sections 12-17-184(10), 12-17-216 and 36-15-15 of the Code of Alabama. A redacted copy of the letter which was filed under seal is attached to this order as Exhibit A.”
According to Alabama code, a District Attorney is required to, “go to any place in the State of Alabama and prosecute any case or cases, or work with any grand jury, when called upon to do so by the Attorney General or the Governor of the State of Alabama, and to attend sessions of courts and transact all of the duties of the district attorney in the courts whenever called upon by the Attorney General or the Governor to do so.”
Speaker Mike Hubbard’s white collar criminal defense attorney, J. Mark White, has stated to the press that this only applies to district attorneys, suggesting that Davis does not fit the requirement because he is retired from his post as St. Clair County DA.
However, Davis is a Supernumerary District Attorney, and according to State code cited by Judge Walker,
“Supernumerary district attorneys shall take the oath of office prescribed by the constitution for judicial officers and shall have and exercise all the duties, power and authority of district attorneys of the judicial circuits or circuit courts and shall, upon request of the Governor, the Chief Justice of the Supreme Court or the Attorney General, conduct investigations, attend any regular, adjourned or special session of any circuit court in any of the judicial circuits of Alabama for the investigation of or the prosecution of any criminal case or the prosecution or defense of any case in which the state is interested.”
If for some reason the Supreme Court of Alabama decides to rule in favor of Moore, legal authorities say this would open a “Pandora’s box” of litigation.
In 2010, the State’s case against chancellor of Alabama’s two-year college system, Roy Johnson, was prosecuted by another St. Clair County DA, Richard Minor, who was acting as a Special Attorney General in the case, after AG Troy King recused himself. Ironically, Johnson pleaded guilty to the State ethics charge before Lee County Circuit Court Judge Jacob A. Walker III.
If the court suddenly ruled the use of DA’s as Special Attorney Generals, then several lawyers believe that Johnson could appeal his conviction by the State. (See article here.)
On September 1, the ‘Alabama Political Reporter’ reported that Speaker Hubbard had spent almost a million dollars on his re-election campaign and almost $200K from his personal campaign account to pay legal fees.
Hubbard had around $55,000 in his principle campaign account, not enough to pay his white collar criminal defense lawyer, J. Mark White. Hubbard’s Storming the Statehouse PAC has less than $10,000, a far cry from the millions he had once predicted for his “incumbent protection plan.” However a well-heeled fundraiser was scheduled for 11:30 to refuel Hubbard’s ‘Stormin the State House’ PAC.
It is also being bantered about that big donors like “Yellow Feller” Jimmy Rane, who owns Great Southern Wood and is also President Pro Tempore of the Auburn University Board of Trustees, were putting pressure on AG Luther Strange as well as members of the State’s Supreme Court to rule in Hubbard’s advantage.
Rane said a year earlier at the dedications of the Mike Hubbard Center at Auburn University, “ I know that Lee County has a good man… if a fistfight breaks out, give me a call.”
Rumors swirling around Montgomery claim that Rane himself had recently appeared before the Lee Grand Jury. (See article here.)
On September 5, the Alabama Supreme Court ruled with the prosecution in the case against indicted lawmaker, Rep. Moore. Shocking almost no one familiar with the case thought Baxley’s pre-trial appeal would succeed. The high court held that the Lee County Grand Jury was properly empaneled and that Special Attorney General W. Van Davis and Matt Hart were legally appointed by the State’s Attorney General’s Office to oversee the investigation into Speaker of the House Mike Hubbard and others. Judge Greg Shaw recused but all other judges agreed to deny.
Moore’s case on two counts of perjury and two counts of making false statements, all of which are felony crimes was set for September 15 in the Lee Count Circuit Court. (See article here.)
On September 9, the Alabama Political Reporter’s editor Bill Britt speculates that a donation of $33,333.00 made to former Gov. Bob Riley’s Alabama 2014 PAC can be linked to a $78 million dollar loan made by the Retirement Systems of Alabama (RSA) to fund Si02 Medical Products. The loan’s genesis began with a $750,000 economic development agreement between the State’s Department of Commerce and CV Holdings, LLC, in 2010.
According to the company’s website, Si02 Medical is a “160,000 square foot manufacturing facility in Auburn, Alabama. The facility houses research and development and the manufacturing of “…silicon-oxide coated containers, utilizing… plasma glass coating technology.”
The company website states that SiO2 Medical Products is a “privately held company… founded and supported by CV Holdings, LLC.” Bloomberg Business describes CV Holding LLC as a company that, “Engages in the design, development, manufacture, and marketing of polymer products primarily for packaging applications. It provides packaging solutions to the pharmaceutical and diagnostic markets; manufactures and fills vials; and manufactures children’s cups, as well as insulated and non-insulated cups for promotions and retail applications. The company has operations in Amsterdam, New York; and Auburn, Alabama. CV Holdings, LLC was founded in 2002 and is based in Amsterdam, New York.”
CV Holdings, LLC owns several other companies including Capitol Cups also located in Auburn. Capitol Cups’ website states that the company “is a leading supplier of insulated and non-insulated travel cups, tumblers, and children’s spill-proof cups for the food, retail, sports and fundraising industries.”
Chances are high if you drink from a cup with an Auburn or Alabama sports logo, you are holding a cup manufactured by Capitol Cups. The president and CEO of CV Holdings which oversees Si02 and Capitol Cups, is Robert Abrams of Amsterdam, NY.
Abrams made the donation of $33,333.00 to Riley. Abrams also signed the economic agreement shortly before Riley left office in 2010. And it was Abrams that signed the loan agreement for the $78 million from RSA. The donation of almost exactly one-third of $100,000 to Riley’s PAC, appears as a huge red flag.
When the Alabama Political Reporter called Si02 in Auburn the receptionist took our name and number and promised a returned call. Within 15 minutes of our call to Si02 headquarters in Auburn we received a call back from the President and CEO of CV Holding Mr. Robert Abrams.
When we spoke with Abrams in early September, he did not offer an explanation for the unusual amount of the contribution, only saying that he supported those who worked to promote business development in the State. When asked about the remaining two-thirds of the possible $100,000 he simply stated that he gave to groups that worked in business development in Alabama.
On October 10, 2010, then, Gov. Riley, signed a project agreement with CV Holdings worth $750,000 in taxpayer dollars, once the company met certain conditions.
The two major conditions of the agreement between Riley and Abrams were that the company would secure $90,000,000 in funding to be invested in the building of a new manufacturing facility in Auburn and that the company would employee at least 250 individuals to work at the facility.
In March, 2012, RSA Chief Executive Officer Dr. David Bronner, along with Speaker of the House Mike Hubbard and other State dignitaries, announced the investment of $90 million dollars into SIO2 Medical production facility in Auburn, with $78,000,000 in loans from funds belonging to State workers.
Dr. Bronner wrote that the $78 million dollar loan was secured by “37 patents and other intellectual property covering the company’s developments, a pledge of stock, and all other assets of the company. The interest rate is 8% and the company will pay the RSA a success fee upon maturity of the loan. The success fee will be 22% of the average daily outstanding balance of the loan for each year the loan is outstanding.”
Bronner also stated that the agreement between RSA and CV Holdings, LLC was two years in the making. Individuals with knowledge of the protracted negotiations between RSA and CV Holdings, LLC, contend that Bronner initially expressed a reluctance to such a high-stakes investment.
In the Alabama Political Reporter’s conversation with Abrams, he expressed a close working relationship with Auburn Mayor Bill Ham. When asked about his relationship with Hubbard, he did not reply directly, only saying he worked with all those in business development in Auburn.
Since the 2010 takeover by the Republican Supermajority, Bronner has been under constant attack by GOP members in the House and Senate.
Many of those attacks ended when in January 2012 Leura Canary was hired as general consul for the RSA. Leura Canary is the former United States Attorney for the Middle District of Alabama. She is also the wife of Billy Canary, the head of the Business Council of Alabama, (BCA) and a close associate of former Gov. Riley and Speaker Hubbard.
Publisher and journalist Bob Martin writing about Leura Canary’s hiring said,
“Two capitol observers told me they believe Canary is being hired because of other reasons; one of them being that Bronner needs to improve RSA’s relations with the Republican-controlled legislature.”
Canary’s hiring not only coincides with an improved relationship between Bronner and the Republican leadership, it also aligns with the closing of a $78 million loan made to finance Si02 in Auburn.
The $33,333.00 donation from Abrams to Riley occurred in November 2012, eight months after the closing of the loan from RSA. The hiring of Leura Canary, the improved relationship with Republican leadership, the closing of the loan from RSA and the donation to Riley’s 2014 PAC falls neatly into a pattern, that has become a signature of Speaker Hubbard and his close associates.
One question about the $33,333.00 contribution the overwhelming response is “Where is the other $66,666.00?” (See article here.)
On September 10, APR reported on an email from Speaker Hubbard announcing a Caucus meeting for Thursday, November 6, 2014 at 11:30 a.m. in Montgomery.
The email which was provided to APR read, “The purpose of this meeting will be to determine, by a vote of the Caucus, our nominees for leadership positions and operating Rules for the upcoming quadrennium. Since there will be a brand new legislature elected on November 4, it is imperative that we make decisions on our leadership and organization so that there will be no lack of direction as we head into the Legislative Orientation in December as well as the constitutionally-mandated Organizational Session in January.”
The stated purpose of the meeting is to “determine, by a vote of the Caucus, our nominees for leadership positions and operating Rules for the upcoming quadrennium.”
There is speculation that the actual, underlying reason for the meeting is that Hubbard is terrified that he will be defeated as Speaker. In 2010, before winning the House, the Republican caucus decided to institute a “pledge” whereby leadership positions were determined by a vote in the caucus, which could not be changed when it came time for the actual process on the House floor.
When the “pledge” was instituted into the process Hubbard and his fellow House Republicans thought they would gain control of the House, but did not realize that they would have a supermajority. The reason for the “pledge” was to keep Democrats from having any say as to who would be elected Speaker or any other positions. However, by creating a supermajority, the need for the “pledge” was not really necessary.
There is speculation that Hubbard wants to use the “pledge” to ensure that his fellow Republicans can’t vote against him as Speaker.
Hubbard is counting on not being indicted before the elections, with the idea of being elected Speaker before he faces any criminal charges. Hubbard could then hold the “pledge” over his caucus member’s heads as a way to retain his speaker’s seat even after indictments were served.
House members who spoke off the record for fear of retaliation are worried that Hubbard’s plan might work. “This is a diabolical scheme, because if he can pull this off we are almost trapped into keeping him as speaker, even while he faces criminal charges.”
Another Legislator told APR that he thinks that the “pledge” would and should be void if Hubbard is in fact charged with committing crimes and using his office for personal gain. “After what the caucus did to Scott [Beason], it would be silly to think we would have to elect Mike, even if he is indicted.”
Another said, “If he is indicted he must step-down or be removed, said a long-serving republican House member, we cannot have an indicted Speaker, it is unacceptable.” (See article here.)
On September 17, the Alabama Political Reporter reported on court documents which were unsealed revealing that Deputy Attorney General Henry T. “Sonny” Reagan, had unsuccessfully tried to quash his subpoena to testify before the Lee County Grand Jury. The Grand Jury is investigating possible criminal activities committed by Speaker of the House Mike Hubbard and others. After being served a subpoena to appear before the Lee County Grand Jury, on August 27, 2014, Reagan filed a sealed writ of mandamus to quash the Lee County subpoena.
This case was originally filed in the Supreme Court. According to court records, the Supreme Court assigned this case to the Alabama Court of Criminal Appeals on September 4. Judge Mary Windom (R) of the Court of Criminal Appeals promptly recused by a filing on September 5.
Reagan was represented before the Lee County Circuit Court and later before an Alabama higher court by Bill Baxley and Rob Riley, the son of former Gov. Bob Riley. Baxley also represents indicted Republican lawmaker State Rep. Barry Moore. Baxley is on record as the attorney getting paid by Hubbard to represent Moore.
Reagan served as Riley’s Chief Legal Advisor during the crusaded against electronic bingo in the State. Riley recruited Reagan to be point man on litigation against Milton McGregor and VictoryLand Casino. After Riley left office, Reagan returned to the Attorney General’s Office where he has served as the chief prosecutor in gaming cases. In the last two weeks, Reagan argued against McGregor and VictoryLand Casino, before Montgomery County Circuit Court Judge William Shashy.
The court rejected Reagan’s writ against his Lee County testimony, at which time Reagan sought to have the court documents sealed from the public. The court denied Reagan’s request and unsealed the documents on Wednesday.
In his petition, Reagan challenged the validity of a subpoena he was served as well as the Grand Jury itself. He also argued the Grand Jury was illegally convened and is being illegally operated. Reagan sided against his boss Attorney General Luther Strange and with Baxley and Moore in saying that Strange did not have the right to appoint W. Van Davis to act on the AG’s behalf in the Lee County Grand Jury (This was the argument put forward by Baxley in the Moore case which was rejected by Lee Country Circuit Court Judge Jacob A.Walker III and an Alabama upper court).
The court also, once again found that AG Strange (R) did have the authority to appoint Davis and that that Grand Jury is legal.
Also in the petition, Reagan argued that Hart was retaliating against him because he had filed a “personnel complaint” with Charla G. Doucet, Chief of the Attorney General’s administrative division. These types of complaints are the first steps in an administrative process which could see Hart reassigned or fired from his position as Chief of the White Collar Crimes Division. In his complaint to the AG, Reagan asked that Hart be reassigned.
In August, the Alabama Political Reporter revealed that sources from both within and outside of the Attorney General’s Office had confirmed that Luther Strange’s Chief Deputy, Kevin Turner, was orchestrating a plot to remove chief prosecutor Matt Hart from the Lee Country Grand Jury investigation. A plan was devised to have a “personnel compliant” lodged against Hart. Reagan it appears was the instrument used to deliver the coup de grâce, against Hart.
Lee County Circuit Court, Judge Christopher Hughes, presided over the hearing for Reagan’s first petition and denied Reagan’s motions as well as an oral motion to stay pending appeal, and Reagan was forced to testify before the Grand Jury.
Reagan through his attorneys Riley and Baxley, then asked the Court that Reagan’s testimony before the Grand Jury be stricken from consideration or, compel the trial court to disband the Lee County Grand Jury therefore nullifying Reagan’s testimony. These requests were rejected by the court.
According to the court documents presented by Riley and Baxley over the past several months, Reagan and Hart were engaged in an interoffice dispute not related to the Lee County Grand Jury.
Reagan has sent several memorandums to Attorney General Luther Strange, Chief Deputy Attorney General Kevin Turner, and/or Chief of the Attorney General’s Administrative Division Charla Doucet, listing alleged instances of misconduct by Hart.
On July 22, 2014, Reagan sent a formal complaint against Hart for misconduct and requested that Hart be transferred to another office.
The basis for the complaint was the fact that Hart had threatened to subpoena Reagan to testify in front of the Lee County Grand Jury if he failed to acquiesce to Hart in the interoffice dispute involving office space and location. However, evidence present in camera before Judge Hughes and the Court showed that the so-called “interoffice dispute” had nothing to do with Reagan’s being subpoenaed.
All accusations were rejected by Lee County Circuit Court, Judge Hughes and an Alabama upper court.
Judge Hughes denied Reagan petition after hearing in camera evidence that show that Reagan had not been subpoenaed to testify in Lee County because of an “interoffice dispute.”
When Reagan finally testified before the Lee County Grand Jury, he invoked his 5th Amendment right. While recognizing that Strange had recused himself from the Lee County proceedings the court ruled that Strange was to be informed about Reagan’s actions. The court made clear that the Attorney General had a mole inside his organization. (See article here.)
Following these revelations Alabama Attorney General Luther Strange (R) placed Reagan on administrative leave for the allegations that he had been leaking information to suspects under investigation.
Speaker Mike Hubbard’s criminal defense attorney J. Mark White has been spinning the revelation of Reagan’s complaint against Special Prosecutor Matt Hart, as evidence that there was a political prosecution of his client. White is now faced with the cold-hard-facts, that Reagan has most likely committed criminal actions to help Hubbard thwart justice from with inside the AG’s Office.
Acting Attorney General Van Davis said in a written statement, “In January 2013, Attorney General Luther Strange directed me to act as the Attorney General in a matter involving potential public corruption in Alabama. During the investigation, we determined that a member of Attorney General Strange’s staff, Deputy Attorney General Henry T. (“Sonny”) Reagan, for a period of months, had undisclosed communications with individuals affiliated with people indicted or under investigation by the Lee County Special Grand Jury. Reagan also took other action to impede or obstruct the investigation.”
Davis continued, “On September 17, 2014, in accordance with court orders and pursuant to my duties as Acting Attorney General, I informed Attorney General Strange of Mr. Reagan’s activities. On September 18, 2014, I received a letter from Attorney General Strange informing me that he had taken immediate action to place Mr. Reagan on administrative leave pending resolution of these matters. I appreciate Attorney General Strange giving the matter top priority for support from his Office. I have every confidence in the professionalism and integrity of the work being conducted by the members of the Attorney General’s staff assigned to me.” (See article here.)
On September 26, the Alabama Political Reporter wrote that a letter from Deputy Attorney General Henry T. “Sonny” Reagan is just the latest in a series of coordinated attacks, to sow discord and confusion over the Lee County investigation into possible criminal activities by Speaker of the House Mike Hubbard and others.
Reagan’s letter dated September, 22, 2014, and addressed to Attorney General Luther Strange and copied to others including, Gov. Robert Bentley, unleashes a torrent of unsubstantiated accusations against Matt Hart, the Chief Prosecutor in the Lee County Grand Jury investigation.
The existence of Reagan’s letter was immediately leaked to certain members of the media, with a prominent female reporter for the Associated Press reportedly calling the Governor’s Office within a half-hour of the Governor’s office’s receiving the letter.
The contents of the letter were reported by the Opelika-Auburn News, at 7:41 pm Tuesday, September 23. The Opelika-Auburn News is the paper of record for the House District represented by Speaker Hubbard, the very man whose court records show is the principle target of the Lee County Grand Jury investigation.
Other news outlets received the leaked letter, including al.com, which allowed Hubbard’s criminal defense attorney J. Mark White to call Reagan’s letter “courageous.”
A political insider, who asked not to be identified, said, “This is classic defense propaganda: throw a grenade over here while the bank is being robbed over there.”
But he, like many others, felt the leaked letter was orchestrated to damage Hart’s credibility, paint the media as patsies and draw suspicion around the proceedings.
Reagan is represented by attorneys Bill Baxley and Rob Riley, the son of former Gov. Riley. Riley and White represent Speaker Hubbard. Baxley also represents indicted Republican lawmaker, Rep. Barry Moore, who is accused of perjury and making false statements before the same Grand Jury. Many defense attorneys in Montgomery have expressed alarm by the potential conflicts in this ménage of attorneys and clients.
Several legal professionals speaking on background have said, it is possible that Rob Riley, White and others, may be using attorney/client privilege to understand the many avenues of the investigation, and to shape their clients defense both in the media and before the court.
The efforts to obstruct the investigation in Lee County are so widespread, that attempts were made by members of the Hubbard/Riley inner circle to convince Gov. Bentley to stop the investigation…..an offer that Bentley soundly refused to even contemplate, according to sources close to the governor.
Reagan testified before the Lee County Grand Jury on August 27, 2014. He testified for almost an hour before asking to speak with his attorney, Bill Baxley (defense attorneys are not allowed in grand jury hearings). After meeting with Baxley, an emergency appeal was made to Lee County Circuit Court Judge Hughes to have Reagan’s Grand Jury testimony quashed. However, Judge Hughes, after being made aware of the prosecution’s evidence against Reagan, (in camera) ordered that he resume his testimony. It was at this point that Reagan took the fifth on advice of counsel.
On September 18, Reagan was placed on administrative leave by General Strange, “in the best interests of the agency,” pending a full administrative hearing.
The letter, rather than being about an internal dispute as Reagan has claimed, is actually filled with many self-serving prose, whereby Reagan portrays himself as “a lifelong public servant,” and one who has, “spent my entire adult life serving either as a soldier in the United States military or as an attorney for the State of Alabama.” Reagan says he has been, “tested in combat and… tested in the courtroom, but I have always done what I believed was right.” Yet during his testimony before the Lee County Grand Jury Reagan, evoked his Fifth Amendment Right, to avoid self-incrimination.
Reagan wrote in his letter to Strange that, “I have always done what I believed was right” yet none inside the AG’s Office or anyone that was contacted for this report could remember a time when a Deputy Attorney General had ever taken the fifth in a criminal court proceeding.
In his letter Reagan states, “My complaint into Mr. Hart’s office misconduct has no bearing on the work of the Lee County Grand Jury. Even if my complaint culminated in Mr. Hart’s internal discipline, the Grand Jury’s work would continue.”
Those inside and outside of the Attorney General’s Office believe that Reagan’s letter—which was leaked to the press— and his personnel complaint, are all part of the larger plan to discredit Hart and to impede the investigation against Speaker Hubbard and others, so the investigation is slowed before the election or killed outright.
In his letter, Reagan repeatedly accuses Hart of [Working] “in concert with reporters to reveal information regarding the grand jury to the press to help his cases.” Hart has never revealed any Grand Jury information to this publication or this reporter. The Attorney General’s Office has steadfastly refused to answer questions about the Lee County investigation asked by this publication or this reporter. In his letter, Reagan appears to be fighting for his job. But, if the statements made by Davis are found true in a court of law, Reagan could be facing not only disbarment but also jail time. (See article here.)
On September 29 the Alabama Political Reporter wrote that in a June, 2014 interview with Inside Alabama Politics, James L. (Jim) Sumner, Jr., the Director of the Alabama Ethics Commission, stated that his office had never received an ethics complaint concerning Speaker of the House Mike Hubbard, R-Auburn. However, an ethics complaint against Hubbard was filed with his office in December, 2013.
The over 50 page complaint reads like a chronicle of articles written by the Alabama Political Reporter over the last several years. It details many suspect actions taken by Hubbard with detailed evidence. Yet, Sumner denies its existence.
Hugh R. Evans III, who serves as General Counsel for the commission, acknowledged – in writing – the receipt of the complaint on December 12, 2013. In a letter to attorney John Aaron, who filed the complaint, Evans confirms receipt of the complaint and also provides Aaron with a case file number.
The complaint against Michael G. Hubbard was assigned case number 2013-308. In his letter, Evans also states that a Special Agent would be assigned to investigate the matter. That agent was Tony Goubil, former chief investigator for the Mobile County District Attorney’s office. Goubil contacted Aaron to arrange a meeting soon after the letter was received but then, for undisclosed reasons, broke off all contact, even refusing to return any of Aaron’s phone calls. Evans’ letter showing that the complaint had been received and assigned a case number and an agent, raises serious questions about Sumner’s denial, and Goubil’s truncated communication with Aaron.
Perhaps, Sumner turned this over to law enforcement, because we are aware that a Grand Jury has been looking into possible illegal activities involving Hubbard.
Still, approximately six months after Evans confirmed receipt of the ethics complaint against Hubbard, Director Sumner told Inside Alabama Politics, when asked why his office never investigated Hubbard, “…I think first and foremost my answer would be: number one, we never had any knowledge of many of the things that are being alleged; and number two, we never had a complaint. So the critics can certainly take whatever criticism they want of that, but first for some agency to be able to do something they have to know something. And we have always operated based on the information we knew at the time. I won’t go beyond that, but that should go a long way toward answering the critics.”
Sumner categorically states on the record that “we never had a complaint,” yet, his own general counsel and special agent confirmed not only that a complaint had been filed, but that it was under active investigation.
Sumner has refused to answer this publication’s questions on this matter and others. Sumner has disparaged APR and its editor, Bill Britt, both personally and professionally. According to associates, he has used foul language in reference to this publication and this reporter. These harangues came after our report on Sumner’s okaying Hubbard’s “consulting contract,” with American Pharmacy Cooperative, Inc., (APCI) without ever personally examining the document.
Sumner told the Alabama Political Reporter in June, 2013, “No, I never saw a contract and didn’t ask to see a contract.”
In June, 2013, this publication revealed that Hubbard was instrumental in placing language into the State’s General Fund budget that would have guaranteed APCI exclusive rights to provide prescription medication for the State’s multi-million dollar Medicaid program.
Disgraced Republican lawmaker, Greg Wren in April, 2014, plead guilty to using his office for personal gain for aiding Hubbard in placing the 23 words into the General Fund Budget.
Sumner retired on October 1 and has been replaced on an interim basis by former Samford Law School Dean John Carroll.
Sumner has been confirmed as having spoken to members of the Attorney General’s Office, who are investigating Hubbard in relation to the Grand Jury hearings in Lee County. (See article here.)
On October 7 APR reported that an angry Speaker Hubbard, according to several members who were present at the most recent meeting of the Council for Leaders in Alabama Schools (CLAS), an association that represents School Administrators across the State, threatened certain State School Superintendents.
On September, 22, Speaker Hubbard was in attendance at the CLAS board meeting to give a legislative update to the groups Board of Directors. At the meeting according to CLAS board member Bobby Jackson, Hubbard was confronted about the Alabama Accountability Act.
Earlier this year, 30 Superintendents of Alabama’s 136 school systems filed an Amicus Brief with the court, in support of a lawsuit claiming the Alabama Accountability Act is unconstitutional.
According to several members present, Hubbard was confounded by Dr. Dee Fowler, Superintendent of Madison City Schools, “And he [Hubbard] kinda got a little offended,” said Jackson.
Fowler, one of the Superintendents who signed the amicus brief, was then threatened by Hubbard, according to several members present. “He told Dee he and the others [who signed the brief] would regret what they had done,” according to Jackson, “it got heated.”
It was relayed that Fowler had questioned why the State Legislature passed the Accountability Act without input from educators or administrators, and why they had passed an act that violated the State Constitution to which Hubbard replied, “The Legislature makes it own rules.”
In May, Montgomery Circuit Court Judge Gene Reese declared the law unconstitutional, saying the Act violated a provision of the State constitution requiring that each piece of legislation cover only one content topic. The case is under appeal.
The 30 Superintendents who agreed with Judge Reese were the targets of Hubbard’s threats.
The bill was passed with a legislative slight-of –hand in conference committee, changing the simple School Flexibility Act into a complex taxpayer funded tax-credit for private schools.
The Accountability Act with its Scholarship Granting Organizations has been a windfall for groups like the one headed by former Gov. Bob Riley, who heads the Opportunity Scholarship Fund and receives 5 percent of all money collected. Riley’s groups have amassed around $25 million and counting.
Hubbard, Riley, along with Senate President Pro Tem Del Marsh have continued to defend the Act, even in the face of the court’s findings. The constitutionality of the Act will be decided by the State’s Supreme Court perhaps later this year.
Hubbard, who is known for his threats and bullying behavior was said to have left the CLAS Board meeting, “in a huff.” (See article here.)
On Saturday, October 18 the Associated Press’s Kim Chandler reported that Speaker Hubbard denied any wrongdoing in an interview he made on Friday amid statewide speculation that he could be arrested at any moment.
Hubbard acknowledged that for 14 months a special grand jury has been seated in his district investigating public corruption. The Speaker called the grand jury a, “political witch hunt.” and said he is confident he has done nothing wrong.
Hubbard told the reporter, “I’ve got the confidence that I have never done anything wrong, never used my office improperly.”
Hubbard declined to say who is responsible for this, “Political Witch Hunt.” Hubbard said, “I have my own theories of where that goes and who all is behind it, and I am confident that in time, we will that find it out.”
Hubbard complained to reporters, “It’s been very stressful, stressful for me, stressful for my family, totally unfair, hard to believe that it is even taking place.”
Hubbard’s attorney Mark White reportedly declined to answer if Speaker Hubbard has been offered a plea deal, but did say that Hubbard would never accept a plea bargain because he didn’t do anything wrong.
On Monday, October 20 Acting Attorney General W. Van Davis announced the arrest of Speaker Mike Hubbard on almost two dozen felony ethics violations.
In the statement, “W. Van Davis announced the arrest today of Michael Gregory Hubbard, a representative from the 79th District in the Alabama House of Representatives, Speaker of the House, and former Chairman of the Alabama Republican Party, for felony ethics law violations. Speaker Hubbard, 52, of Auburn, surrendered this afternoon to special agents of the Attorney General’s Office at the Lee County Jail.”
Specifically, the indictment charges Speaker Hubbard with the following twenty- three felony Ethics Law violations: four counts of using of his office as Chairman of the Alabama Republican Party for personal gain; one count of voting for legislation with a conflict of interest; eleven counts of soliciting or receiving a thing of value from a lobbyist or principal; two counts of using his office as a member of the Alabama House of Representatives for personal gain; four counts of lobbying an executive department or agency for a fee; one count of using state equipment, materials.
If convicted, Speaker Hubbard faces a maximum penalty of two to twenty years imprisonment and fines of up to $30,000.00 for each count, all of which are Class B Felonies. Acting Attorney General Davis commended those who are handling this case, noting in particular Special Prosecutions Division Chief Matt Hart, Deputy Attorney General Mike Duffy and investigators with the Special Prosecutions Division.
Monday’s indictments confirm many of our greatest fears. Speaker Mike Hubbard allegedly strayed too far from the ethical and legal path or at least that is what a grand jury believes may have happened.
An indictment should never be confused with a conviction. The burden of proof is on Van Davis and Matt Hart and the prosecution to prove their charges beyond a reasonable doubt in the minds of twelve jurors. None of the defendants have yet had an opportunity to present their sides of the story and all of the accused should be presumed innocent until such time as a jury of their peers finds them guilty of having committed a crime.
Another question to ponder is what will the U.S. Justice Department do? The FBI and the U.S. District Attorney’s office can either join Hart’s prosecution, let the state of Alabama deal with its own matters, or start their own investigation into alleged wrongdoing by Alabama elected officials?
Stay tuned to the Alabama Political Reporter for further updates on this and other political news in the state of Alabama. No one else in the state, covers the political arena in Alabama with the same passion, balance, and 24/7 focus that we do.
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