Indictments near federal time limit

Author(s): WILLIAM PACK Date: November 23, 1999 Section: News

The third federal grand jury to look at allegations of wrongdoing involving former Gov. Edwin Edwards and three business associates probably won’t investigate for long, says an attorney for one target of the probe. Attorney Tommy Damico, who represents a Texas businessman under investigation with two Edwards associates for a waste disposal deal pitched to New Orleans, said he has been told an indictment will be returned by the end of November.

That timeline would require federal prosecutors to quickly give grand jurors a summary of the alleged extortion case involving Evergreen Global Resources Inc. – and perhaps other questionable deals linked to Edwards.

The grand jury in Baton Rouge expected to hear the case was not chosen until Monday.

Of course, predicting the date of federal indictments in the nearly 4-year-old investigation of Edwards has been about as certain as forecasting the Reform Party’s next presidential candidate.

The investigation already has produced two indictments: one citing corruption in the state’s riverboat casino licensing process and the other alleging fraud in a financial settlement with the president of a failed insurance company.

The grand jury in Baton Rouge that returned the indictments took the case over in 1997 from a federal grand jury in New Orleans. The grand jury in Baton Rouge took two years to complete its work. Both indictments came later than had been widely predicted.

But there might be good reason for federal authorities to move quickly now on some aspects of the investigation – federal law limits how much time can elapse between an alleged crime and an indictment. With most federal crimes, that cap is five years. Former U.S. Attorney Harry Rosenberg said all the crimes that prosecutors appear to be investigating now would be bound by that five-year limit.

That limit might not be an issue in the alleged criminal activity involving Damico’s client, Guy Thompson. That alleged scheme began in the summer of 1995 and continued to generate evidence in 1996, prosecutors claimed in a written defense of wiretaps used in the riverboat case.

Thompson, who was an Evergreen official, paid $500,000 to former Houston Mayor Ered Hofheinz, expecting some of the money would go to Edwards associate Cecil Brown and eventually to then-Gov. Edwards, prosecutors said.

Prosecutors described the payment as part of an extortion scheme involving a waste disposal contract Evergreen hoped to secure with New Orleans.

While Morial met briefly with Evergreen officials, New Orleans eventually rejected their proposal.

Two other projects involving Edwards, Brown, Hofheinz and Texas businessman-turned-informant Patrick Graham started in 1994 or earlier.

If those projects are still under federal scrutiny, their timing might become an issue. The five-year statute of limitation is about to toll on crimes committed in 1994.

One project involved the relocation of the Minnesota Timberwolves pro basketball team to New Orleans. The proposal was killed by the National Basketball Association in June 1994 because of financing issues.

The other project involved a $35 million construction contract for a private juvenile prison near Jena. A Hofheinz company became involved in the project in late 1992, but backed out of the deal in 1997,

But prosecutors have said Graham told the FBI he gave $845,000 to Brown in 1994 on behalf of Hofheinz, and Brown took the money to Edwards.

Prosecutors said the cash was meant as a “down payment” that would help Hofheinz’s firm win the construction contract for the prison.

Brown, indicted with Edwards and five other men in the riverboat corruption case, has admitted being paid by Hofheinz’s interests to win the governor’s support for the prison and the Timberwolves project.

Both Brown and Edwards have denied committing any crimes. Edwards contends he is not among those targeted for indictment in the lingering investigation.

Twenty-three grand jurors will decide whether he is right and how long he must to wait to find out.

William Pack covers federal court for The Advocate. Copyright 1999, 2000 Capital City Press, Baton Rouge, La.