Business cards, Web site, phony CEO disguise FBI sting at Capitol
They had business cards, a Web site, and a chief executive who lobbied lawmakers over wine and finger food at a downtown reception.
But the electronics and computer recycling firm was phony, a front for an elaborate FBI sting operation to catch Tennessee lawmakers accepting bribes.
The two-year undercover operation, code-named “Tennessee Waltz,” ended Thursday in the arrest of four lawmakers and a former legislator on bribery charges.
“This was a major-league effort,” said Neil Cohen, a former state prosecutor. “It’s not uncommon — it’s ongoing all the time all over the country, but there aren’t many at this level, where there’s this much effort and resources and time devoted to one particular sting.”
E-Cycle went so far as to register as a corporation with the Georgia Secretary of State, listing its chief executive officer as “J Carson.” It also had a storefront in downtown Memphis, not far from the Beale Street entertainment district.
Undercover agents, posing as executives of E-Cycle, offered lawmakers free trips to Florida and served them wine and food over live music at a reception at a downtown Nashville hotel in late January.
“I think it’s fair to say this type of thing is expensive,” said George Bolds, spokesman for the FBI office in Memphis, who said he could not reveal the exact cost of the sting. “It’s kind of an extraordinary and sensitive technique used.”
Cohen said new technology made it possible for federal agents to collect much of the evidence on video or audiotape.
“There may be an awful lot of proof,” Cohen said.
Prosecutors played a video in court Friday of state Sen. John Ford watching an undercover agent count out $10,000 and an audiotape of him threatening a potential witness. Ford, the uncle of U.S. Rep. Harold Ford Jr., is the only lawmaker accused of threatening witnesses.
Ford, a Memphis Democrat who has been in the Senate for more than 30 years, resigned from the Legislature on Saturday, saying he wanted to clear his name and spend more time with his family.
The four lawmakers indicted — Sens. Ford, Kathryn Bowers and Ward Crutchfield; and state Rep. Chris Newton — were all sponsors of a bill proposed by E-Cycle.
But the E-Cycle bill didn’t look terribly suspicious on its face, and it was working its way through the Legislature until Newton withdrew it the day before he was arrested.
It would have given the state the option of getting rid of its old computer equipment by sending it to a “qualified electronic recycling company.” The company would buy the equipment at fair market value and dispose of the equipment outside the state.
State Rep. Charles Sargent, R-Franklin, was among six co-sponsors of the E-Cycle bill who were not indicted. “I took a look at it, and it was basically a recycling bill. It would keep this kind of equipment out of landfills,” he said.
Sargent said he attended the January reception thrown by E-Cycle, but doesn’t remember meeting any E-Cycle executives.
“I think I had three receptions that night,” he said.
Another bill sponsor who wasn’t charged, state Rep. Paul Stanley, R-Germantown, met twice with E-Cycle’s chief executive officer, a man named “Joe Carson.” Once, they met over lunch at a Memphis restaurant to discuss the bill.
Both Stanley and Sargent said they did not take any money from E-Cycle.
“I’m concerned about the perception of it,” Stanley said. “It’s a very unfortunate situation. If you read the bill, it sounds like a good bill.”