Friday, January 18, 2008

McMahans Got $10,000 In Cash, Indictment Alleges

The federal indictments returned against Auditor and Inspector Jeff McMahan and his wife, Lori, allege Mrs. McMahan was given an envelope with $10,000 cash in it by abstract company owner Steve Phipps.
Both Jeff McMahan and his wife, a Tecumseh schoolteacher, face the same nine counts: one conspiracy count, six mail fraud counts and two counts of violating the Travel Act to promote bribery. U. S. Attorney Sheldon Sperling (pictured) outlined the charges.

The maximum total prison time possible for the nine counts is 135 years.

The Travel Act allegations concern trips the McMahans allegedly took on Phipps' tab. One trip was to New Orleans in the summer of 2003; the other was to Boston for the 2004 Democratic National Convention.

During the New Orleans trip, Phipps gave Lori McMahan — with her husband's knowledge — a ring that cost $1,640, the indictment alleges.

The indictment actually mentions two other trips allegedly paid for by Phipps: a fishing trip involving McMahan and his teenage son; and a second trip to New Orleans by Jeff and Lori McMahan in October 2004.

Phipps also contributed, either directly or indirectly, $77,600 to McMahan's 2002 campaign through straw donors, according to the indictment.

In addition, Phipps handed an envelope containing $10,000 to Lori McMahan on Oct. 22, 2002, the indictment states. The cash exchange allegedly occurred at a Shawnee restaurant. Lori McMahan told her husband she and Phipps had business to conduct, the indictment states.

Gov. Brad Henry said today it would be "appropriate" for McMahan to take an administrative leave of his office. "Before I pass judgment, I want to review all the available information and hear the auditor's public response to the charges," the governor said. "In the meantime, however, I believe it would be appropriate for the auditor to step aside on administrative leave and turn over the office's day-to-day operations to his chief deputy while the allegations are resolved."

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