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Case Number: 4:18-cr-00076-RH-EMT
Judge: Robert L. Hinkle
Court: United States District Court for the Northern District of Florida (Leon County)
Plaintiff's Attorney: United States Attorney’s Office
Description: Tallahassee, FL: Conspiracy to operate a racketeering enterprise criminal defense lawyers represented Defendants, former Tallahassee City Commissioner Scott Maddox and his former business partner Paige Carter-Smith.
In December 2018, a federal grand jury charged then-City Commissioner Maddox and Carter-Smith in a 44-count indictment for conspiring to operate a racketeering enterprise that engaged in acts of bank fraud, extortion, honest-services fraud, and bribery. That indictment also charged Maddox and Carter-Smith with bank fraud, making false statements to financial institutions, extortion, honest-services fraud, use of interstate facilities to facilitate bribery, making false statements to federal officers, conspiracy to interfere with the lawful function of the IRS, and filing false tax returns. In May 2019, a federal grand jury returned a 47-count superseding indictment adding a third defendant, John Thomas Burnette, and charging him with participating in the racketeering conspiracy and extortion, honest services mail fraud, the use of facilities in interstate commerce to facilitate bribery, and making false statements to federal officers.
Maddox and Carter-Smith each subsequently pleaded guilty to two counts of honest-services fraud and one count of conspiring to interfere with the lawful function of the IRS. According to court documents, while serving as a sitting, voting City Commissioner, Maddox received payments from Governance, a government consulting and lobbying company based in Tallahassee that he started in 1999 and sold to Carter-Smith in 2010. The payments were made to Governance by several companies in either monthly installments or lump sums, which companies sought favorable votes on City of Tallahassee issues. Specifically, the defendants pleaded guilty to Maddox’s acceptance and Carter-Smith’s facilitation of payments from a rideshare company in exchange for favorable treatment on issues it had before the City Commission, and payments from another company in exchange for his favorable treatment on issues that were anticipated before the Commission. The defendants also admitted to tax fraud that resulted in losses of more than $76,000 in total to the IRS.
In accordance with their plea agreements, both Maddox and Carter-Smith testified in the trial against Burnette, who was convicted on one count of extortion, two counts of honest services mail fraud, one count of the use of a facility in interstate commerce to facilitate bribery, and one count of making false statements, and who is scheduled to be sentenced on Oct. 28.
“Today’s sentences are a result of our tireless efforts to pursue justice for those who put their trust in their elected representatives,” said Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division. “We will never cease working to ensure that both public officials who fail the citizens of their community by accepting bribes, and those who pay bribes, are held accountable.”
“The democratic system on which our country was founded relies on the consent and trust of the governed,” stated Acting U.S. Attorney Jason R. Coody for the Northern District of Florida. “Our citizens deserve and expect that their elected representatives will honor their oath - acting in the public’s interest, rather than accepting bribes and payments out of fear or favor. Today’s sentences acknowledge betrayal of the public trust, the resulting erosion of confidence in our democratic process, and should serve as a significant deterrent to those who would seek to illegally profit from public service. With our law enforcement partners, we remain committed to ensuring that anyone who violates the public’s trust is held accountable.”
“The individuals sentenced today abused Maddox's public office for their own private gain,” said Assistant Director Calvin A. Shivers of the FBI’s Criminal Investigative Division. “Actions like this erode the trust that Americans place in our governmental institutions, and the FBI will not tolerate such contemptable disregard of public’s trust by elected officials who promise to serve them. The FBI and our law enforcement partners are committed to protecting the government’s integrity by bringing corrupt officials and their cohorts, like Maddox and Carter-Smith, to justice, and we will never stop working to uncover others who think they are beyond the reach of the law.”
“Maddox and Carter-Smith brazenly filed fraudulent tax returns to cheat the government, perhaps because they thought their political ties made them above the law,” said Special Agent in Charge Brian Payne of IRS-Criminal Investigation. “Those Americans who file accurate, honest, and timely returns can be assured that the government will hold accountable those who don’t.”
The FBI Jacksonville Field Office and IRS-Criminal Investigation investigated the case.
Deputy Chief Peter M. Nothstein and Trial Attorney Rosaleen T. O’Gara of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorneys Stephen M. Kunz and Andrew J. Grogan of the Northern District of Florida prosecuted the case.
FRAUD BY WIRE, RADIO, OR TELEVISION
FRAUDS AND SWINDLES
CONSPIRACY TO DEFRAUD THE UNITED STATES
Outcome: Defendants were sentenced to five years and two years in prison, respectively, for their roles in a multi-year scheme to use Maddox’s power as a sitting City Commissioner to extract bribes from Tallahassee companies with business in front of the City Commission. Maddox and Carter-Smith were also ordered to pay restitution in the amount of $76,763 and $115,619, respectively, and ordered to pay a forfeiture money judgment in the amount of $70,000.