The The fake documents appeared to be internal AG memoranda strongly suggesting that then-Attorney General Janet Napolitano was covering up appalling conditions in a fundamentalist Mormon polygamous enclave in Colorado City.
After discovering last winter that the documents were bogus, DPS investigators asked Mahoney and long-time aide Sam Vagenas to voluntarily submit to interviews after not only Mahoney's phone records but also Vagenas' were linked to a woman whose name appears in the forgeries.
Mahoney and Vagenas refused to meet with authorities, and referred investigators to their attorneys. Inexplicably, the DPS did not pursue the case further, and Attorney General Terry Goddard's office declined to prosecute earlier this month, citing a lack of evidence.
While Mahoney and Vagenas were mentioned frequently in the DPS' investigation report, they were never identified as suspects. Neither could be reached for comment. Mahoney is said to be out of the country while Vagenas is traveling in California with business associate and University of Phoenix founder John Sperling.
Vagenas was Mahoney's media consultant during last fall's gubernatorial campaign. A former girlfriend of Vagenas' told a DPS investigator that Vagenas "was in charge finding dirt" on Napolitano and Republican candidate Matt Salmon and producing "negative television ads" for the campaign.
The DPS investigation found that several calls were placed between phones listed as belonging to Mahoney, Vagenas and someone identified in the forged documents as Stephanie Lynn Olsen, who reportedly had been beaten and raped in Colorado City. DPS efforts to locate Olsen have been unsuccessful.
A call between Olsen's phone and Mahoney's campaign cell phone occurred one day after the bogus documents were anonymously faxed last September 26 to New Times and the Arizona Republic.
It should be noted that while the documents themselves are fake, most of the allegations contained in them have been substantiated by New Times during a 10-month investigation of Colorado City polygamists started immediately after the materials were leaked. New Times has confirmed that incest, rape, coerced marriages of underage girls into polygamy, welfare abuse and weapons violations indeed have occurred in the polygamous enclave north of the Grand Canyon along the Arizona-Utah border.
Napolitano asked the DPS to initiate its criminal investigation into the authenticity of the leaked documents last October 4 during the final weeks of the tightly contested gubernatorial campaign. The probe concluded that a three-page memo that appeared to have been prepared by the Attorney General's special investigations unit, a letter to Napolitano from purported rape victim Olsen and an affidavit submitted to Mohave County authorities were all forgeries.
The "special investigations" document contained the handwritten initials "TM," which, the DPS concluded, were forged to simulate the signature of Tina McMillon, an investigations supervisor for the AG's office. The documents appear to have been sent to the newspapers from a fax machine in the basement of the state Department of Corrections headquarters in Phoenix.
After receiving the documents, New Times conducted a series of interviews with the Attorney General's office and independent sources. The AG's office substantiated "investigatory aspects" raised in the documents and confirmed that the office had conducted a two-year criminal investigation into polygamy-related issues in Colorado City that had resulted in no arrests.
Several days later, the AG's office declared the documents were forgeries -- after New Times had already gone to press with a story based on them. The article appeared on October 3, and stories also appeared in the Republic.
Within days, the Mahoney campaign began using the news accounts as the basis for television commercials that raised the specter of a possible violent confrontation in Colorado City reminiscent of the Branch Davidian conflagration in Waco, Texas. The commercials featured a Phoenix woman named Flora Jessop, who maintains she was raped and beaten while living in Colorado City in the 1980s.
In one ad, Mahoney accused Napolitano of inaction and covering up the mistreatment of women in Colorado City. In another, he claimed that Salmon, if elected, would not address the problems related to polygamy because he is a Mormon.
Mahoney's television commercials ripping his opponents were widely criticized at the time as slimy and misleading. A Republic editorial compared Mahoney to a cockroach.
Salmon says Mahoney's TV ads may have cost him the election because it appears to have discouraged thousands of Christian Republicans from voting for him because of concerns about his membership in the Church of Jesus Christ of the Latter-day Saints. Ironically, the Salt Lake City-based Mormon church disavowed polygamy in 1890 and claims to have excommunicated anyone practicing it since, including the fundamentalist Mormons in Colorado City.
"His commercials hurt us very badly," Salmon says.
Napolitano could not be reached for comment.
She narrowly defeated Salmon in one of the closest gubernatorial elections in state history. Her margin of victory was 11,819 votes out of more than 1.2 million cast. Mahoney came in a distant third.
Mahoney ran for governor as a clean-elections candidate and received more than $1.69 million in public funds for his campaign. He spent several hundred thousand dollars on the Colorado City TV ads in the last few weeks of the campaign.
A former Democrat who served as Arizona Secretary of State from 1991 through 1995, Mahoney narrowly lost the 1996 Democratic primary for the U.S. Senate to former Congressman Sam Coppersmith.
Vagenas has been a close associate of Mahoney's for more than a decade, once serving as his deputy secretary of state. In addition, Vagenas has been a leader in several pro-marijuana initiatives that have appeared on the Arizona ballot since 1996.
The investigation by the DPS included interviews with several members of the AG's staff that ruled out the possibility that the documents were produced from within the AG's office.
Police also subpoenaed numerous telephone records, beginning with a telephone number that appeared to be a contact for Olsen that was written on one of the documents faxed to the newspapers. Police determined that someone giving the name Stephanie Olsen began cell phone service with a 602 area code on September 16, 2002.
Someone using the Olsen phone called eight Phoenix-area phone numbers. Two of the numbers were to different cell phones belonging to Vagenas, and a third call was to the primary cell phone used by Mahoney during the campaign. The Olsen phone was also used to call a cell phone owned by Jonathon Levenson, who was a Mahoney campaign worker.
Levenson tells New Times that he does not remember talking to anybody named Olsen, but at the same time, doesn't rule out having such a conversation.
All the calls placed on the Olsen phone were to 480 and 602 numbers, except for a toll-free call to Verizon customer service. Yet all the calls were listed on the bill as long-distance, indicating that the Olsen phone was not in the Phoenix area. The longest call made on the Olsen phone was for 18 minutes to the KFYI radio talk show on September 24 -- two days before the forged documents were faxed to the newspapers.
Calls on the Olsen phone were placed to Vagenas twice on September 17 and once on September 18. A four-minute call was placed on the Olsen phone to Mahoney's cell phone on September 27 -- moments after Mahoney's phone was used to call Olsen's phone.
New Times has had no more luck locating Olsen than DPS investigators. The home address given when the Olsen phone was activated is for an apartment in Mesa. But when investigators went to the high-rise complex on North Robson Road, they were told by the manager that no one by the name of Stephanie Olsen lived there.
Mahoney was first contacted by the DPS last February 3 to explain why his cell phone had received a call from the Olsen phone. At first, Mahoney agreed to meet with investigators. But he declined the following day, telling the DPS that it should contact his attorney, Michael Piccareta.
"In the interest of fairness, I think you [DPS Detective Kevin Wood) need to go through my attorney," Mahoney is quoted as saying in the DPS report.
Vagenas, meanwhile, hired attorney Tom Rawles after he was contacted by the DPS in early April. According to the agency's report, Rawles called authorities on April 3 and said Vagenas "was in the dark about what was going on."
The DPS never investigated further by contacting the lawyers, a spokesman says, because the AG's office never asked for further information.