The Courier-Journal from Louisville, Kentucky • Page 36

4 THE COURIER-JOURNAL THE FORUM SUNDAY, JULY 30, 1995 BOPTROT: THE INSIDE STORY i 7 P- -j- wwww w- giiniiiumi iupiiiiJiiULi iiiii iiwi in in hum mammrn 1 M' 1 WI WW NMi ilk-. SEN. DAVID LEMASTER left, shown entering jail and leaving 24 hours later) -tvX Lf V-wt. 1 "a ---t-nMl nrlii nn i 1 i iffliiilii iriiamii iiii PsZ'Hmdi 1 Jan. 7, 1992: an investigation's climax SEN.

JOHN ROGERS (above, holding subpeona) Senate Republican leader, from Somerset Indicted April 6, 1994: extortion conspiracy, attempted extortion, mail fraud, lying to the FBI. Charges alleged Rogers and others agreed to accept "a portion of profits from a bank" if he used his position as senator and vice chairman of Senate Banking and Insurance Committee to help pass a 1984 banking bill; and lied to the FBI in 1992 when asked about the matter. Disposition: Convicted by jury on all charges; sentenced to 42 months in prison. Resigned from Senate and is serving time at federal prison camp in Manchester. BRUCE WILKINSON Director of appointments to boards and commissions for Gov.

Wallace Wilkinson, his uncle, 1987-91. Indicted July 27, 1992: extortion conspiracy, mail fraud. Charges alleged Bruce Wilkinson took a $20,000 cash bribe on Jan. 7, 1992, in exchange for having earlier agreed to help fix the outcome of an arbitrator's ruling in a dispute over racing dates between Henderson race tracks and Ellis Park. 11 cross paths with John W.

"Jay" Spurrier III. Spurrier was the long-time lobbyist for Kentucky Utilities, a man whose side activity as a harness-industry regulator propelled him into the arcane world of racing squabbles and that seamy underside of the General Assembly the BOP committees, which oversee racing legislation. Spurrier was arguably the feds' biggest catch of BOPTROT. Though he became a pariah because of his role in the probe he now works at a retirement community in 1991 the diminutive Lexingtonian was at the apogee of his considerable power. He operated out of the offices of House speakers and majority leaders and spent part of his time in Washington, where he was a golfing buddy of then-House Ways and Means Chairman Dan Rostenkowski.

He was an old-fashioned lobbyist who displayed unfailing courtesy to lawmakers and served as an impresario, arranging legislative junkets and dinner parties at his condo in the Holiday Inn Capital Plaza. As court-approved phone taps later showed, he operated under an assumption that an enemy might catch him and ruin him. He used McBee as insulation. In August 1991 Koumas' recorder caught McBee stressing one point about the initial payments being made to McBee and Spurrier: "Spurrier is like a silent partner in this deal. You're not going to say you are getting help from Spurrier." To foil anyone wearing a wire instinctive behavior, perhaps, for a man who had spent many years scheming with politicians Spurrier spoke in codes, jabbered jargon and mumbled incoherently.

"You could never understand what he said," the late Lyle Robey, a friend, once recalled. "He talked in that kind of jabberwocky." To keep himself insulated from the big arbitration payoff, Spurrier asked that McBee arrange for Koumas to pay it as a legal fee to McBee's wife, who is an attorney. But she refused. Then McBee and Spurrier discussed candidates for the role of bagman a person who could take the cash from Koumas, follow instructions from McBee and drop the money off at a location where Spurrier could pick it up and maintain deniability. "What about John Hall doing it? He works for 'em," McBee suggested.

FBI agent Christiansen, listening to that tapped conversation as it happened, could hardly believe his luck. The flipping of John Hall would pay off after all. Snaring Spurrier Spurrier and McBee had told Koumas that, for $50,000, they had someone who could fix the crucial arbitrator's decision in Riverside's favor. The feds did not know who that was (and later said in court that the conspirators never did fix the decision). The phone taps kept the feds informed of each step in the scheme.

Gov. Wilkinson appointed as arbitrator a young lawyer (from a Bowling Green law firm that supported him politically). In an opinion filed in the final hours before Wilkinson's term ended on Dec. 9, the lawyer ruled for Riverside. Spurrier then arranged the payoff, with McBee carrying out the instructions.

Koumas was to pay Hall $50,000. Hall would report it as income for lobbying and keep $20,000 to cover his taxes on the income. Hall would then deliver the $30,000 (in packages: $10,000 in one, $20,000 in the other) to Frankfort, meeting McBee at Flynn's Restaurant on Jan. 7, 1992, where he would get further instructions. That day was the climax of BOPTROT.

Some 40 FBI agents were in Frankfort. Hall met agents at the Best Western Motel that morning. A tape recorder was strapped to his body. His most important instruction was not to leave the money unattended be sure to give it to a person. Agents used $20 bills so that they would have a bulky package.

They recorded each serial number, photocopied each bill, and then sprayed the bills with a fluorescent powder supposedly undetectable except under special light. A transmitter was concealed in a black briefcase; the money was put inside. And because of Frankfort's hilly terrain, the FBI had an airplane overhead all day to assure that the transmitter's signals could be relayed to the FBI receivers on the ground. Hall met McBee outside Flynn's. "There's your message," McBee told Hall, handing him a note.

"Read it and tear it up and hand it back to me." Hall, who forgot his eyeglasses, had trouble making it out. He started reading the note aloud. "I don't know what it says," McBee growled. "I don't want to know." "The annex Capitol?" Hall stammered. "No! The hotel," McBee replied.

The note told Hall to take the money to room 418 of the Holiday Inn Capital Plaza. Spurrier had ar Paintsville Democrat and chairman of Senate Business Organizations and Professions Committee. InrtintfiH Mav 19. 1993- attfimnt to commit extortion, interstate travel in aid of racketeering, lying to the FBI. Charges alleged LeMaster took bribes totalling $6,000 during the 1992 legislative session from Spurrier and agreed to oppose possible legislation harming harness racing industry; lied to FBI when asked if he had taken money from Spurrier.

Disposition: Acquitted of extortion and racketeering, convicted of lying. Sentenced to a year in prison, fined $30,000 plus costs of incarceration and probation. Conviction on lying charge upheld by U.S. Court of Appeals in May. LeMaster resigned last year after being sent to jail to begin his sentence.

Was freed after he submitted his resignation. He has been temporarily suspended from practicing law and is living in Paintsville awaiting outcome of further appeals of his case. HOUSE SPEAKER DON BLANDFORD Philpot Democrat who served longer than anyone in history (eight years) as speaker of the Kentucky House. Indicted Nov. 12, 1992: extortion conspiracy, racketeering, attempt to commit conspiracy, lying to the FBI.

Charges alleged that during the 1992 legislative session Blandford took $1 ,500 in bribes from lobbyist Bill McBee for agreeing to oppose possible legislation that would hurt harness racing tracks; accused of pattern of racketeering activity that linked the 1992 bribes with actions in the 1980s when he allegedly defrauded his campaign fund by taking $6,518.50 from it and giving it to his staff and himself; and lied to FBI when asked about these matters. Disposition: Convicted of extortion, racketeering and lying. Acquitted of attempt to commit conspiracy. Sentenced to 64 months in prison, fined $1 0,000 and ordered to pay $108,000 cost of incarceration. Now serving time at federal prison in Terre Haute, Ind.

BUEL GUY Chief executive assistant to Speaker Blandford. Indicted Sept. 3, 1992: lying to the FBI. Charge alleged Guy lied when he told FBI agents he had not taken cash payment from Bill McBee in 1990. Disposition: Pleaded guilty.

Sentenced to two years' probation, including 30 days in federal halfway house and 60 days' home detention; fined $500, plus costs of detention and supervision. Guy resigned in wake of indictment and now operates a woodworking business in Frankfort. JOCKEYS' GUILD INC. Charged Nov. 23, 1992 extortion.

Charge alleged the Jockeys' Guild paid about i $1,400 to Bill McBee during December 1986 convention in Las Vegas to influence McBee and other legislators on racing legislation. Disposition: Pleaded guilty, fined $25,000. aiding fitl 1 i Disposition: Convicted of extortion, acquitted of mail ranged with the hotel management to get the keys to that room, and one adjoining, tor the day. But Hall's problem was that the note instructed him to put the mon ey in the dresser drawer of Room 418 and leave, locking the door on his way out. As he drove to the hotel, Hall tried to call his FBI handler, agent Chns tiansen, on his car phone.

But Hall no ticed that McBee had gotten in a car and was following. Hall was finally able to get a distance from McBee, and he called Christiansen. But just as he was explaining that the note or dered him to leave the money, Hall drove down Louisville Road hill, a dead spot for cellular phone calls, and the phone went dead. He drove around the hotel in a panic, unable to make phone contact with Christian sen. He decided to drop off the mon ey, and then rush to a pay phone outside the hotel.

Hall was terrified as he walked into the hotel with the briefcase. "I knew people were watching me there. 1 didn know who what side of the fence or what," Hail said. "I'm not knowing who the other side is, who's watching me, or who's going to blow my head off." He took the elevator to the fourth floor and walked to 418. As the instructions from McBee said, the door was unlocked.

"There was nobody there. I look under the bed. I even walked in the bathroom, pulled the shower curtain back," Hall said. He put the briefcase in the drawer and left: What Hall did not know is that Spurrier was nearby listening behind the door of the adjoining room. After Hall had gone, Spurrier walked into the room, opened the drawer and found the briefcase.

He took the money from the briefcase and put it in a small plastic laundry bag with a drawstring. Spurrier later testified that as he was leaving the room he noticed he'd almost forgotten Hall's nice briefcase. In a fatal, final act of courtesy as a lobbyist, Spurrier went back and retrieved the briefcase with its transmitter hidden inside. Caldwell and three other government attorneys were just across the plaza, looking out the window at the hotel. They listened transfixed to the transmitter's signal recording Spurrier huff and puff his way up five flights of steps to his condo on the ninth floor.

They heard a door open, then the See BOPTROT Page 5, col. 1, this section conspiracy. Charge alleged Bronger took three cash payments totalling $2,000 during the 1992 session in exchange for his help in blocking legislation that would hurt harness race tracks. Disposition: Pleaded guilty. Sentenced to 10 months in prison, plus two years' supervised probation and 200 hours of community service.

Resigned from House at the time he was charged; completed his sentence at federal prison camp in Manchester and now runs a concrete sealing business in Louisville. SEN. HELEN GARRETT Paducah Democrat and member of Senate leadership whose phone call to a race track owner in 1990 sparked the entire investigation. Indicted Aug. 31, 1992: mail fraud.

Charge alleged that on Sept. 28, 1990, Garrett solicited and got a $2,000 bribe from Riverside Downs in exchange for helping the track with legislation. Disposition: Pleaded guilty. Sentenced to four years' probation, fined $30,000, ordered to pay $2,000 in restitution. Garrett, who was defeated for reelection before BOPTROT surfaced, is retired and living in Lexington with her daughter.

Continued from Page 1 ation of the South Carolina legislature (Operation Lost Trust). If he cooperated, the federal agents said, he could be a hero of a similar story in Kentucky. Hall agreed to cooperate. Agents took him to dinner that night so he could cool down. At dinner he was reunited with Koumas.

"Koumas wanted to know if I was holding up okay, like it was Old Buddy Week. And here I am with four FBI agents and they're all patting each other on the back, joking and laughing," Hall recalled. "I'm thinking: What in the hell is going on here?" Greed overcomes caution After months of effort, Koumas was able to establish a rapport with a major suspect McBee. "I guess his own greed eventually took over," Koumas said in explaining how he won McBee's confidence. Koumas used that rapport, eventually, to arrange a meeting with McBee's friend Jay Spurrier, the undisputed king of Frankfort's lobbyists and a state harness racing commissioner.

Koumas arranged to talk with Spurrier on an Aug. 9, 1991, airplane flight from Orlando to Atlanta. A later indictment identifies this encounter as the moment when Spurrier first agreed to help Riverside. Koumas soon succeeded in passing some modest bribes to McBee and through McBee to Spurrier tor Spurrier influence as a member of the harness commission to get favorable racing dates for Riverside in the coming year. Ihen, in a conversation he record ed at the bar of the Marriott Griffin Gate Resort in Lexington on Nov.

1, 1991, Koumas drew Spurrier into talking about a prospective arbitrator's decision to apportion the lucrative rights to conduct wagering on thoroughbred races simulcast into Henderson County. The case pitted Riverside against Ellis Park. "What's it worth?" Spurrier asked. "I'll be sitting with the guy who can appoint him (the arbitrator) tomorrow." "Name it," said Koumas. "I don't know," said Spurrier.

"They'll probably say 50." The FBI now had a lead on a hot $50,000 payoff and a realistic dream of finally flipping a real insider, perhaps" the ultimate insider Spurrier. Spurrier's rules By looking into harness racing in Kentucky, the FBI was destined to took bribes of up to $8,000 to help Riverside Downs get racing dates it wanted for 1992; conspired to fix the outcome of arbitrator's ruling in dispute between Riverside Downs and Ellis Park and took $6,000 bribe as part of this conspiracy. Disposition: Pleaded guilty. For his cooperation, he was given light sentence: home detention for six months, two years' probation; fined $2,000. Spurrier, fired as lobbyist for Kentucky Utilities when BOPTROT surfaced, is now working at The Lafayette at Country Place, a Lexington retirement community.

REP. CLAY CRUPPER Dry Ridge Democrat who was chairman of House Agriculture and Small Business Committee. Indicted June 8, 1992: interstate travel in aid of racketeering. Charge alleged that in December 1990, while at Jockeys' Guild convention in Las Vegas, he took a $400 bribe in exchange for agreeing to help Riverside Downs. Disposition: Pleaded guilty.

Sentenced to three years' probation, including 90 days in a halfway house; fined $10,000, plus costs of detention and supervision; ordered to perform 300 hours of community service. i friniT miwi ftinWbdfc iihi fraud. Sentenced to three years in prison followed by two years of supervised release. Fined $20,000. Conviction upheld by U.S.

Court of Appeals in May. Serving sentence at federal prison camp in Manchester. SEN. JOHN HALL Henderson Democrat who secretly cooperated with the FBI in early phase of the investigation. Indicted April 28, 1992: extortion conspiracy, interstate travel in aid of racketeering.

Charges alleged Hall extorted $4,850 from harness track Riverside Downs in late 1990, keeping $1,500 of it and giving the rest to other lawmakers on a December 1990 junket to Las Vegas convention of the Jockeys' Guild. Disposition: Pleaded guilty; sentenced to 30 nights at halfway house; 90 days' home incarceration and three years' probation; fined $5,100. Hall, who was defeated for reelection before BOPTROT surfaced, still owns a paint and glass store in Henderson. JOHN W. "JAY" SPURRIER III The dean of Frankfort lobbyists and former chairman of Kentucky Harness Racing Commission, Spurrier was nabbed 1 -o'ii i 1 i Professions Committee.

Indicted June 23, 1992: three counts of extortion conspiracy, one count interstate travel with intent to promote unlawful activity. Charges alleged McBee conspired to extort $30,000 from Dueling Grounds Race Course in Simpson County in exchange for helping to pass a 1990 bill vital to the track; conspired to extort a bribe from Riverside Downs in 1991 and 1992; conspired to extort money from Riverside Downs during the 1992 legislative session; in late 1980s sold his influence on racing matters by accepting a payment from the Jockeys' Guild during the group's convention in Las Vegas. Disposition: Pleaded guilty. Sentenced to 15 months in prison, two years' supervised probation, 200 hours of community service; fined $30,000 and cost for confinement and probation supervision. McBee was defeated for reelection in 1990 and became a lobbyist.

Finished serving his time and is now living in Boone County; is being treated for throat cancer. REP. JERRY BRONGER Louisville Democrat who succeeded MeBee as House BOP chairman. Indicted July 22, 1992: extortion to- mm Crupper resigned from legislature in wake of the indictment and is now farming and selling cars in Grant County. REP.

RONNY LAYMAN Leitchfield Republican. Indicted June 11, 1992: conspiracy to commit extortion, lying 1 fVr4 to the FBI. rV Charges allege i 1 that in December 1990, while at Jockeys' Guild convention in Las Vegas, he took a $400 bribe in exchange for agreeing to help Riverside Downs; lied when he denied to FBI agents that he took the money. Disposition: Pleaded guilty. Sentenced to three months of hoifie detention, 300 hours of community service, and three years' probation; ordered to pay cost of home incarceration.

Layman was defeated for reelection before BOPTROT surfaced. He sells insurance in Leitchfield. REP. BILL MCBEE Burlington Democrat and chairman of the House Business Organizations and mtmAmmmmm for his own crimes and secretly agreed to wear a microphone and be the key mole for the FBI investigation. Indicted May 20, 1992: extortion conspiracy, conspiracy to deprive citizens of honest services of a public official.

Charges alleged that as a member of the Kentucky Harness Racing Commission in 1991 Spurrier mtt dinA. Wiirtfciiifti iAi iViftfi A.