FOR IMMEDIATE RELEASE TUESDAY, JUNE 24, 2003 WWW.USDOJ.GOV CRM (202) 514-2008 TDD (202) 514-1888 WASHINGTON, D.C. - Acting Assistant Attorney General Christopher A. Wray of the Criminal Division, Acting U.S. Attorney Louis V. Franklin of the Middle District of Alabama, and Alabama Attorney General Bill Pryor announced today that Nicholas Bailey, the former acting director of the Alabama Department of Economic and Community Affairs, pleaded guilty to conspiracy to commit bribery in connection with federal programs and wire and honest services fraud, and filing a false tax return.
Baileys plea occurred this afternoon before U.S. District Court Judge Charles S. Coody of the U.S. District Court for the Middle District of Alabama, Northern Division. At the same hearing, Montgomery, Alabama, businessman and consultant Clay Lanny Young pleaded guilty to conspiracy to commit bribery and embezzlement in connection with federal programs, mail and honest services fraud, and filing a fax tax return. Montgomery architect William Curtis Kirsch also pleaded guilty to felony conspiracy to commit bribery and embezzlement in connection with federal programs, and mail and honest services fraud.
The charges against the defendants stem from Baileys corrupt arrangement with Young and Kirsch. In todays plea, Bailey admitted to soliciting and receiving more than $100,000 in cash payments and other things of value from Young between January 1996 and April 2001, in exchange for Bailey using his authority and power, and causing other officials to use their authority and power, to advance Youngs business interests with the state of Alabama.
Bailey also admitted in todays proceedings that after he resigned from state government in early 1998 to work for a candidate in the Alabama governors campaign, Young gave him $19,000 in so-called consulting fees that Bailey never reported to the Internal Revenue Service. Bailey also acknowledged that he solicited and received over $21,000 of cash payments and other things of value from Kirsch between January 1999 and April 2001, in exchange for Bailey using his authority and power, and causing other officials to use their authority and power, to advance Kirschs business interests with the state of Alabama.
In their pleas, Young and Bailey each admitted that they gave the cash payments and other things of value to Bailey intending to influence him to use his authority and power, and cause others to do the same, to advance their business interests with the state. Young also admitted that in 1999, as a result of Baileys assistance, the Alabama Department of Revenue issued a tax reduction resulting in substantial financial savings to one of Youngs corporate clients, the owner of a large landfill located in Emelle, Alabama. Young was paid $500,000 by his client for his lobbying effort, which he did not report on his 1999 income tax return.
As part of their plea agreements, all three defendants have agreed to cooperate with an ongoing investigation being conducted by the U.S. Department of Justice and the Alabama Attorney Generals Office. All the defendants have also agreed to plead guilty to felony conflict of interest charges, which will be brought by the Alabama Attorney Generals Office in separate proceedings in state court.
The maximum penalty for conspiracy is five years in prison and a fine of $250,000, and the maximum penalty for filing a false tax return is three years in prison and a $250,000 fine.
The case is being prosecuted by Senior Trial Attorney John W. Scott of the Public Integrity Section of the Criminal Division at the Department of Justice, headed by Section Chief Noel L. Hillman, and First Assistant U.S. Attorney Julia J. Weller and Special Assistant U.S. Attorney John Gibbs of the U.S. Attorneys Office for the Middle District of Alabama. The case was investigated by agents of the FBI, the IRS and the Alabama Attorney Generals Office. 03-380
Source: US Department of Justice
