Piatt Avoided Challenge By Returning Phillips Cash

House Majority Floor Leader Greg Piatt apparently avoided a challenge to his leadership position yesterday by agreeing to return a $5,000 campaign donation from controversial Texas businessman Bradford Phillips, Republican sources tell The McCarville Report Online.

Piatt, at the urging of new House Speaker Chris Benge, agreed over the weekend to return the donation after earlier announcing he would keep it. Had he not done so, the sources say, an effort to challenge his continued role as majority floor leader would have come at Monday's GOP House Caucus meeting. The effort was underway Monday morning when word circulated that Piatt had agreed to return the donation.

The donation, and others from those associated with interests of the Phillips family, had been criticized by some GOP House members because Piatt accepted the donations last year after sponsoring an amendment affecting insurance companies. The amendment would have benefited the interests of Bradford Phillips and his father, Gene Phillips, controversial figure who was involved in the scandal that toppled former Insurance Commissioner Carroll Fisher.

Piatt, from Ardmore, told The Oklahoman's Michael McNutt that Benge encouraged him to return the donation over the weekend. Benge told him that for the "sake of moving forward" he should return it. Piatt acknowledged there "was a problem with perception by our members. But there was nothing unethical or illegal about anything that was done."

Piatt told McNutt he likely won't accept future donations from Phillips because it is a "lightning-rod issue."

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Piatt Keeps Phillips' $5,000 Campaign Donation

By Mick Hinton In The Tulsa World ~ House Majority Leader Greg Piatt said Friday that he will keep a $5,000 campaign contribution from Bradford Phillips, who sought legislation last year that would have benefited insurance companies his family holds in trust.

Piatt, R-Ardmore, said he did not solicit the contribution.

There was nothing illegal about Phillips' giving the contribution or Piatt's accepting it.

The lawmaker said he would receive criticism no matter what decision he made about the contribution.

Piatt said he discussed the issue again Friday with two key members of his campaign committee in Ardmore, and they agreed with his decision. "It doesn't go away either way, but if you do nothing wrong, there is nothing to apologize for," he said.

Piatt proposed a key amendment to the legislation sought by Phillips. He received the donation at an Ardmore fundraiser in June after the 2007 legislative session. Two days earlier, Piatt also received a $5,000 donation from Stephen Jones, an attorney for Bradford Phillips' father, Gene Phillips. Jones is a major contributor to Republicans. Campaign donations are limited to $5,000.

Two other lawmakers confirmed this week that they have returned campaign contributions from Phillips. Rep. Ron Peterson, R-Broken Arrow, who leads the committee that heard the controversial legislation, said he returned a $4,000 check shortly after he received it in late December. Peterson said that as chairman of the committee that hears such bills, he wanted to make sure that there wasn't even the perception that he would be influenced by a donation.

He said the merits of the insurance amendment have been lost in the controversy over Phillips.

State Insurance Commissioner Kim Holland had proposed that an insurance company could make commercial real estate loans based on a cap of 2 percent of assets, patterned after a national model. However, Piatt succeeded in passing an amendment in the House committee to raise the amount to 20 percent.

Both Peterson and Piatt said they have considerable experience in the insurance and banking fields and that 20 percent is reasonable.

The bill with the Piatt amendment was approved by the committee but was not brought to the House floor because it had become controversial.

Meanwhile, Rep. Paul Wesselhoft, R-Oklahoma City, a committee member, said Thursday that he returned a $700 check from Phillips. Peterson said he told committee members who received contributions that he thought it was a good idea not to accept them. He advised them to return them, and at least four of the members have. They were contributions of about $600 each.

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Piatt Donations An Issue In Speaker's Race?

Sources in the State House report today that campaign donations to House Majority Leader Greg Piatt (pictured) of Ardmore by those associated with controversial Dallas businessman Gene Phillips and his son, Bradford, are becoming an issue in the race for speaker.

Two GOP members of the House say that Piatt supports Rep. Gus Blackwell to replace Lance Cargill and they have taken note of today's report in the Tulsa World highlighting Blackwell's unusual move, last session, of using his leadership role to cast a vote on a pro-Phillips measure in a committee in which Blackwell technically is not even a member.

The measure sought by the Phillips interests was carried by Piatt, the House Majority Leader, the World reported last year: Phillips' son Bradford Phillips tried unsuccessfully last session to get an Oklahoma law changed that would have allowed the family's insurance companies to put up fewer assets when making real estate loans. State Insurance Commissioner Kim Holland strongly protested the change, which was approved in committee but did not make it into law. The amendment was carried by House Majority Leader Greg Piatt, R-Ardmore, who received a $5,000 contribution from Bradford Phillips in June, state Ethics Commission records show.

One member of the House says the donations to Piatt for his 2008 campaign by those connected to Phillips is at least $11,000. Ethics Commission records show the $5,000 donation from Bradford Phillips on June 6, 2007, plus donations of $5,000 from Enid attorney Stephen Jones, who represents Phillips' interests, on June 4, 2007; and $1,000 from lobbyist Bobby Stem, who lobbies for Phillips' interests, on May 31, 2007.

Following Insurance Commissioner Holland's protest against the Phillips measure, Republican Bill Case, with the support of those in the Phillips camp including Jones, tried to defeat Holland. He failed. He is now a lobbyist for Phillips in Stem's firm.

In addition, a mysterious committee based in Austin, Texas, tried to defeat Holland and spent almost half a million dollars in the unsuccessful effort.

The controversy over the Phillips family erupted again recently, when it was revealed that several GOP legislators, including then-Speaker Cargill and Blackwell, attended a fundraiser for Mike Huckabee at Gene Phillips' palatial home in Dallas. After the event was publicized and questions were asked, several legislators said they received, and returned, donations from Bradford Phillips. Some estimate the legislators recently returned at least $6,200 to Phillips.

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Hickman, Sears, Faught Return Phillips Money

Mick Hinton of the Tulsa World and The Associated Press report today that State Reps. Jeff Hickman, Earl Sears and George Faught are returning contributions given by the son of a man linked to convicted former state Insurance Commissioner Carroll Fisher. The donations were given by Bradford Phillips who is the son of Texas insurance company owner Gene Phillips.

Here's the essence of Hinton's story: Three Republican lawmakers confirmed Wednesday that they will be returning unsolicited campaign contributions from Bradford Phillips, the son of controversial Texas insurance company owner Gene Phillips.

Rep. Jeff Hickman, R-Dacoma (left), and Rep. Earl Sears, R-Bartlesville (center), both said they received checks for $600, and Rep. George Faught, R-Muskogee (right), received $645.

The contributions came in late December.

The three are members of a House committee that approved legislation favorable to the Phillips family last spring.

Faught said that when he learned about the controversy surrounding the Phillips family, he decided to return the check.

Sears, who had cashed the check, took $600 out of his campaign Tuesday and sent it to Phillips.

Hickman said he was mailing the check back Wednesday. "I returned the contribution; I just felt uncomfortable," Faught said.

Read more at http://www.tulsaworld.com/news/article.aspx?articleID=20080117_1_A9_hThem76744.

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Oklahoman: Legislators Scrutinized Over Event

The Sunday Oklahoman has a lengthy article about the Mike Huckabee fundraiser at the Dallas home of controversial businessman Gene Phillips that was attended by numerous Oklahoma Republican legislators, including House Speaker Lance Cargill.

Reporters Nolan Clay and Randy Ellis list all those from Oklahoma who attended and have statements from most of them.

Cargill told the reporters he was invited to the event by a lobbyist for insurance companies controlled by Phillips and his son, Brad, former State Rep. Bill Case, unsuccessful candidate for insurance commissioner in 2006. Cargill said he didn't know the event was being held at Phillips' home.

Read the entire story later today online at www.newsok.com. The newspaper is on the stands.

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World: Cargill Says He Didn't Know Huckabee Fundraiser Was At Dallas Home Of Gene Phillips

By Mick Hinton In The Tulsa World ~ Several Republican House members, including Speaker Lance Cargill, attended a fundraiser recently in the home of Texas businessman Gene Phillips, who has been linked to convicted former insurance commissioner Carroll Fisher.

Phillips was hosting the fundraiser for Republican presidential hopeful Mike Huckabee.

Fisher is serving a three-year prison sentence for embezzling $1,000 from his campaign and lying on a contributions report. He also is accused of accepting $25,000 and other gifts from Phillips, his family and business associates in exchange for favorable treatment of their insurance companies. Fisher has said the money was a loan.

Cargill said Friday that he went to the fundraiser at the invitation of a former colleague. "I was not informed where the event was," he said. "As it turns out, it was at his (Phillips') home." Cargill said he looked at the event as a chance to visit "with the person who has a legitimate chance to be president of the United States.

Rep. Danny Morgan, who leads the House Democrats, said Friday, "When I heard this, I was floored. "It looks very suspect that the speaker would allow himself and members of his caucus to be involved in a fundraiser with an individual allegedly involved with Commissioner Fisher," Morgan, D-Prague, said.

Rep. Gus Blackwell, R-Goodwell, said Friday that "it never clicked" in his mind when he and others went to Phillips' home Dec. 18 to attend the fundraiser. Other Republican lawmakers who attended were Reps. T.W. Shannon of Lawton and Mike Jackson of Enid. Three other GOP lawmakers reportedly were at the fundraiser.

Phillips' son Bradford Phillips tried unsuccessfully last session to get an Oklahoma law changed that would have allowed the family's insurance companies to put up fewer assets when making real estate loans. State Insurance Commissioner Kim Holland strongly protested the change, which was approved in committee but did not make it into law. The amendment was carried by House Majority Leader Greg Piatt, R-Ardmore, who received a $5,000 contribution from Bradford Phillips in June, state Ethics Commission records show.

Holland noted that Gene Phillips was linked to an anonymous Web site that showed up during her 2006 election bid. Although it did not name Holland, the Internet campaign ad featured a silhouette of her. "Yes, he (Phillips) was linked to the Web site and he was the gentleman linked to one or more indictments against the former commissioner," Holland said at the time.

Meanwhile, Shannon said Friday that he went to the fundraiser not knowing that questions had been raised about Phillips. "I learned all of this after the fundraiser," he said. "It was just a chance to get to see Mike Huckabee."

Stephen Jones of Enid, who has been Gene Phillips' attorney, was one of the co-sponsors of the event. Regarding the Oklahoma lawmakers' attendance, Jones said: "I saw some of those boys. They were all Huckabee supporters." Jones estimated that 250 to 300 people were at the fundraiser, held at Phillips' pool house. Other reports put attendance at 100 to 150. "Phillips has a beautiful home, and he knows how to entertain," Jones said, noting that many functions are held there, although not usually political ones. "There's nothing wrong with it," he said.

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Stem, Case Lobby For Phillips Company

Lobbyist Bobby Stem's firm, Capitol Gains LLC, is now the registered lobbyist for an insurance company associated with controversial Texans Gene and Bradford Phillips, Ethics Commission records show. Former Republican State Rep. Bill Case (pictured), unsuccessful candidate for insurance commissioner, joined Stem's firm in December as a registered lobbyist.

The registration shows Stem (left) and Case now represent American Reserve Life Insurance Company, a company that figured prominently in the criminal investigation that helped force disgraced former Commissioner Carroll Fisher from office.

Enid attorney Stephen Jones has represented Phillips family interests in Oklahoma. In last year's contentious race for insurance commissioner, Jones and his associates donated thousands to Case's campaign and Jones has confirmed to The McCarville Report Online that another client of his is the secretive "Just The Facts America" group based in Austin, Texas and headed by Texas Republican activist Jim Cardle; JTFA is the entity that invested an estimated $300,000 from anonymous donors in television commercials and a website attacking incumbent Insurance Commissioner Kim Holland, Democrat appointed by Governor Brad Henry when Fisher resigned rather than face removal from office. Investigations into Fisher showed he accepted gifts from a company tied to Gene Phillips.

A document on file in the state of Kansas reports the following: "On April 11, 2005, Bradford A. Phillips, President and Chief Executive Officer of Liberty Bankers Life, provided the Commissioner with an organization chart, dated December 31, 2004, indicating that the May Trust is the "Ultimate Controlling Parties" of Realty Advisors, Inc., American Reserve Life Insurance Company, and Liberty Bankers Life. Mr. Phillips also provided documentation indicating that the Trustees of the May Trust are Mickey N. Phillips, Ryan T. Phillips, and Donald W. Phillips." They are the children of Gene Phillips, as is Bradford Phillips. Regulators in other states have found that Gene Phillips exercises considerable authority over the operations of the companies.

Grand jury probes into Fisher's conduct resulted in allegations he accepted bribes from Phillips, his family and business associates while insurance commissioner. The alleged bribes included a $25,000 check from Davister Corp. Jones said Phillips was never an officer, director or shareholder of Davister. But the U.S. Securities and Exchange Commission identified the company as being "managed by the same personnel who manage ... other private companies owned by Phillips or his family trusts.''

In September 1999 Fisher personally approved the sale of Tulsa-based American Reserve Life Insurance Co. to a Phillips-related company, authorities said.

Gene Phillips was interviewed twice by investigators from the attorney general's office, the grand jury's legal adviser, and Phillips' business associates, including Ron Akin (an officer of Davister), were subpoenaed to testify before the earlier grand jury. Akin appeared before the grand jury twice. Jones was successful in fighting efforts to force Gene Phillips to appear.

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