By Ray Stern
By Ray Stern
By New Times
By Amy Silverman
By Stephen Lemons
By Stephen Lemons
By Monica Alonzo
By Chris Parker
A source familiar with a federal grand jury investigation of Symington tells New Times that government prosecutors have built a powerful criminal case against the governor and are eager to file a "slew" of meticulously documented charges.
"This guy is going to get indicted," the source says. "When people read this indictment, he is going to be underground for a week."
The first major shot in a war that could bring down Symington's governorship, and, perhaps, send him to prison, was fired last week.
The March 14 federal grand jury indictments against Symington's closest political adviser, George Edward Leckie, and the governor's personal accountant, John David Yeoman, leave little doubt that Symington is the ultimate target of government prosecutors.
Leckie and Yeoman were indicted on seven counts of fraud stemming from the alleged rigging of a $1.53 million state contract awarded in September 1991 to Coopers & Lybrand, an accounting firm in which Yeoman was a partner. The contract was to provide consulting services for Project SLIM, Symington's initiative to streamline government.
Yeoman also faces charges of lying to a grand jury and obstruction of justice.
The grand jury has been probing Symington's finances since at least July 1992 and was prepared to indict Symington late last year on charges stemming from the filing of false financial documents, the source tells New Times. But the Symington indictment was postponed after new information about Project SLIM surfaced.
The indictment against Leckie and Yeoman details how the government believes the crimes were committed, including a new allegation that they exchanged information during a face-to-face meeting on September 7, 1991, at Paradise Valley Country Club. Earlier disclosures centered on phone calls between the two while bids were being evaluated.
Two days after the meeting at the country club, Coopers & Lybrand won the contract--after lowering its bid by $443,000, or 29 percent.
The 13-page indictment does not elaborate about possible motives. It merely claims that Leckie's and Yeoman's actions provided Coopers & Lybrand "an illegal and unfair competitive advantage in connection with the award of the Project SLIM contract."
While Coopers & Lybrand benefited by winning the contract, the indictment makes no mention of how Leckie personally benefited from the alleged scheme, says Tom Connelly, a former assistant U.S. attorney who is Leckie's defense lawyer.
"Normally, there is a modus operandi, a quid pro quo, and I don't see it here," Connelly says.
Documents in the hands of federal prosecutors, however, indicate that Symington may have financially benefited. Symington owed Coopers & Lybrand at least $45,000 in 1991. After the Project SLIM contract was awarded in September 1991, the firm not only substantially reduced Symington's accrued debt, it continued to do new work for him.
By 1993, Symington's debt to the accounting firm had risen to $88,000. But Coopers & Lybrand didn't press for payment. Instead, the firm wrote off $83,000 of Symington's debt.
Symington may have had other reasons to steer the Project SLIM contract to Coopers & Lybrand. The firm had served as his business accountant for many years, doing everything from preparing income tax returns to reviewing the personal financial statements he used to obtain loans. The firm also managed his campaign finances and helped prepare disclosure statements candidates and elected officials must submit annually to the state.
It was Coopers & Lybrand that signed off on a May 31, 1991, financial compilation that showed Symington had a personal net worth of minus $23.2million. Symington used the report to fend off a consortium of union pension funds seeking repayment of a $10 million loan he had personally guaranteed. A year earlier--on May 4, 1990--when the pension funds issued the loan, Symington presented a financial statement saying he was worth $11.95million.
Perhaps Symington felt he owed Coopers & Lybrand a favor after the national accounting firm checked off on his precipitous financial collapse: $35 million in 12 months.
While these documents--and others in possession of federal prosecutors--raise serious questions about Symington's financial dealings, it is likely that the government is waiting for an insider to tell the whole story. That story may soon emerge as Leckie and Yeoman ponder the possibility of going to prison.
Tactics typically used by federal prosecutors in public corruption cases are straightforward, somewhat brutal and frequently effective: Indict several underlings close to the ultimate target and wait for one of them to cut a deal that includes implicating the kingpin.
Prosecutors often raise the stakes by telling the indicted lackeys that the government will only cut a plea bargain with one party--usually the first to come clean.
Leckie and Yeoman, no doubt, spent the past week wondering which of them would sing first. Neither can relish the prospect of spending several years in a federal prison and facing huge fines to save a bankrupt, apparently lameduck governor.
While the former aides sweat, the federal government continues its criminal investigation into Symington's messy financial affairs. Already, enough details have emerged to leave little doubt that the feds could indict Symington tomorrow--if they wished.
Which raises the stakes for Leckie and Yeoman. If they wait too long to cut a deal with prosecutors and spill the beans, the government could indict Symington anyway, foreclosing Leckie's and Yeoman's chances to avoid, or significantly reduce, prison terms.