Prosecutor: McMahan 'Bought'
By Susan Hylton/Tulsa World ~ Prosecutors vow that when they present their case in U.S. District Court (in Muskogee) this week, the jury will see what happens when a public official — State Auditor and Inspector Jeff McMahan — allows himself to be bought.
But defense attorneys for McMahan and his wife, Lori McMahan, claim that the prosecution's key witness, multimillionaire Kiowa businessman Steve Phipps, is not reliable because he is a master manipulator and a career criminal.
Jeff McMahan's attorney Rand Eddy said Phipps knew he would be going to prison anyway in connection with the bilking of more than $2 million from the Legislature to pay bribes and kickbacks. In a plea agreement, he pleaded guilty to one count of conspiracy to commit mail fraud in exchange for assisting the prosecution in a sprawling investigation of political corruption in southeast Oklahoma.
"He thought he needed to give the government a big fish," Eddy said.
The prosecution's first witness was former state Auditor and Inspector Clifton Scott, who testified that he has known Phipps since 1984 or 1985, when the Auditor's Office began regulating the abstracting industry.
The McMahans are accused of accepting excessive campaign contributions, gifts and trips in exchange for political favors for Phipps.
In his opening statement, Assistant U.S. Attorney Ryan Roberts said Phipps and his former business partner Gene Stipe — a state legislator for more than 50 years — would gladly give someone $100,000 when they knew that they'd receive 10 times that in return.
Scott said Phipps was placed on an abstract board that advised the Auditor's Office. Phipps owned abstract offices with Stipe, and Scott said he was aware of that relationship. Scott testified that he received support from the abstracting industry in his own campaigns but that he had concerns about how McMahan's trips to New Orleans with Phipps and his employees could be perceived. Phipps allegedly purchased expensive jewelry for Lori McMahan on these trips.
After Jeff McMahan was elected and Scott was working in the Land Commission Office, Scott said, Phipps called him in 2005 when Phipps was in a civil dispute with Stipe. Scott said a meeting was set up with Phipps, McMahan, an insurance commission representative and himself to talk about revoking Stipe's insurance license after Stipe was convicted of perjury and campaign violations.
Lori McMahan's attorney Kevin Krahl said the Tecumseh fifth-grade teacher is guilty of violating state campaign laws by taking money from Phipps for signs, radio spots and a campaign jingle. But Krahl said she never told her husband that trips to political conventions were paid for by Phipps.
At the end of his opening statement, Roberts said that Lori McMahan had said in a recorded conversation that she would "go to the pen" if Phipps was secretly recording her conversations. The prosecutor urged jurors to do exactly what Lori McMahan had feared. "Send 'em to the pen," he said.
Several others testified that Phipps asked them to contribute to McMahan's 2002 campaign and would reimburse them — sometimes a little more than they gave — for their trouble.
Some of the contributors also admitted to being "straw donors" in the campaigns of Gov. Brad Henry, U.S. Rep. Dan Boren, and former state Rep. Mike Mass, all Democrats.
Nita Magdalena, a Democratic Party organizer, said Phipps asked her to organize a fundraiser for Henry in January 2003 — after Henry had won his election. The fundraiser was successful, Magdalena said, and Phipps was able to give Henry about $100,000 in checks. Henry's spokesman Paul Sund said Monday that the Governor's Office did not have an immediate comment on Magdalena's testimony.
But defense attorneys for McMahan and his wife, Lori McMahan, claim that the prosecution's key witness, multimillionaire Kiowa businessman Steve Phipps, is not reliable because he is a master manipulator and a career criminal.
Jeff McMahan's attorney Rand Eddy said Phipps knew he would be going to prison anyway in connection with the bilking of more than $2 million from the Legislature to pay bribes and kickbacks. In a plea agreement, he pleaded guilty to one count of conspiracy to commit mail fraud in exchange for assisting the prosecution in a sprawling investigation of political corruption in southeast Oklahoma.
"He thought he needed to give the government a big fish," Eddy said.
The prosecution's first witness was former state Auditor and Inspector Clifton Scott, who testified that he has known Phipps since 1984 or 1985, when the Auditor's Office began regulating the abstracting industry.
The McMahans are accused of accepting excessive campaign contributions, gifts and trips in exchange for political favors for Phipps.
In his opening statement, Assistant U.S. Attorney Ryan Roberts said Phipps and his former business partner Gene Stipe — a state legislator for more than 50 years — would gladly give someone $100,000 when they knew that they'd receive 10 times that in return.
Scott said Phipps was placed on an abstract board that advised the Auditor's Office. Phipps owned abstract offices with Stipe, and Scott said he was aware of that relationship. Scott testified that he received support from the abstracting industry in his own campaigns but that he had concerns about how McMahan's trips to New Orleans with Phipps and his employees could be perceived. Phipps allegedly purchased expensive jewelry for Lori McMahan on these trips.
After Jeff McMahan was elected and Scott was working in the Land Commission Office, Scott said, Phipps called him in 2005 when Phipps was in a civil dispute with Stipe. Scott said a meeting was set up with Phipps, McMahan, an insurance commission representative and himself to talk about revoking Stipe's insurance license after Stipe was convicted of perjury and campaign violations.
Lori McMahan's attorney Kevin Krahl said the Tecumseh fifth-grade teacher is guilty of violating state campaign laws by taking money from Phipps for signs, radio spots and a campaign jingle. But Krahl said she never told her husband that trips to political conventions were paid for by Phipps.
At the end of his opening statement, Roberts said that Lori McMahan had said in a recorded conversation that she would "go to the pen" if Phipps was secretly recording her conversations. The prosecutor urged jurors to do exactly what Lori McMahan had feared. "Send 'em to the pen," he said.
Several others testified that Phipps asked them to contribute to McMahan's 2002 campaign and would reimburse them — sometimes a little more than they gave — for their trouble.
Some of the contributors also admitted to being "straw donors" in the campaigns of Gov. Brad Henry, U.S. Rep. Dan Boren, and former state Rep. Mike Mass, all Democrats.
Nita Magdalena, a Democratic Party organizer, said Phipps asked her to organize a fundraiser for Henry in January 2003 — after Henry had won his election. The fundraiser was successful, Magdalena said, and Phipps was able to give Henry about $100,000 in checks. Henry's spokesman Paul Sund said Monday that the Governor's Office did not have an immediate comment on Magdalena's testimony.
Labels: Brad Henry, Clifton Scott, Dan Boren, Gene Stipe. Jeff McMahan, Lori McMahan, Mike Mass, Ntia Magdalena, Steve Phipps
posted by Mike McCarville @ 9:10 AM
