Former Rep. Micah Neal details alleged "slush fund" kickback scheme in federal corruption trial of former Sen. Jon Woods | Arkansas Blog

Former Rep. Micah Neal details alleged "slush fund" kickback scheme in federal corruption trial of former Sen. Jon Woods

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KICKBACK KIDS: Neal (left) testified against Woods (right) today, describing a kickback scheme and other shenanigans. - ARKANSAS BUSINESS ILLUSTRATION.
  • Arkansas Business illustration.
  • KICKBACK KIDS: Neal (left) testified against Woods (right) today, describing a kickback scheme and other shenanigans.


The indefatigable Doug Thompson has the latest in the federal corruption trial of former state Sen. Jon Woods

Federal prosecutors allege that Woods took kickbacks from state money he guided to Ecclesia College and a mental health agency. Two alleged co-conspirators, Oren Paris III, president of the college, and former state Rep. Micah Neal, have already pleaded guilty. Also on trial is Randell Shelton Jr., a friend of Woods and Paris who allegedly participated in the scheme. Paris pleaded guilty less than a week before the trial began, suddenly flipping from co-defendant to cooperating with the government.

The government opened with the big guns today, Thompson reports from the courthouse, with Neal testifying against his alleged co-conspirator. Neal described a kickback scheme based on grant money via the state's General Improvement Fund (the pork barrel program that dollops out taxpayer money for legislators' pet projects, which was declared unconstitutional last year):
Neal testified this morning that Shelton delivered $18,000 in $100 bills stuffed in two Arvest bank envelopes in December 2014 behind his family’s Springdale restaurant, Neal’s Cafe. The money was a kickback for directing $50,000 in Improvement Fund grants to Ecclesia, Neal said.

“It’s like a slush fund. It’s what it is,” Neal said of the grants, adding they also helped win votes and garner media publicity.
And the ugly details of a couple of petty criminals — Neal, hard up for money, asked Woods how he was scoring cash when he saw the high-priced sports memorabilia at Woods' apartment in Little Rock:

Neal said he became involved in the kickbacks because he was having financial trouble and asked Woods how he made money. Neal said he asked Woods because he observed Woods had a nicely furnished Little Rock apartment with sports memorabilia such as a baseball bat signed by Pete Rose and a signed photograph of Michael Jordan.

Woods said he had a deal worked out and came back to him a few days later with the kickback plan in which the two would receive 20 percent of any grant money steered to Ecclesia and another nonprofit, AmeriWorks, Neal said.
Also coming up today in Neal's testimony: former superlobbyist Rusty Cranford, who was indicted by a federal grand jury in Missouri in April for his alleged role in a bribery scheme that involved the same Medicaid-enriched nonprofit that was involved in the alleged shenanigans of Neal, Woods, and company. (Cranford has also been accused by the government in court filings of trying to hire someone to murder one of his alleged co-conspirators who is now cooperating with the government, though he has not been charged in that alleged plot.) There has been speculation that Cranford could testify against Arkansas legislators in corruption cases, and though he has not been charged in this case, he clearly appears to be implicated. Neal testified that Cranford put a $1,000 campaign donation from Cranford in his personal account and got tips from Woods on how to cover it up.

Much more from Thompson over at the Northwest Arkansas Democrat-Gazette.



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