CINCINNATI — The same FBI agents who helped convict former Cincinnati City Councilman PG Sittenfeld simultaneously built a separate corruption case in 2019 at the statehouse, intertwining Queen City politics and development with Columbus lawmakers.
The statehouse case is a more complex and separate alleged scheme than the one that rocked City Hall and led to Sittenfeld’s conviction for bribery in July.
On Tuesday, jurors in the public corruption trial of former Ohio House speaker Larry Householder and ex-GOP chair Matt Borges heard secret recordings of the same three undercover agents — Brian, Vinny and Rob — who played starring roles in Sittenfeld’s trial.
The agents posed as wealthy developers who asked for Sittenfeld’s help to build a new boutique hotel at the blighted Convention Place Mall, at 435 Elm St. downtown, and outfit it with exclusive sports betting.
Meanwhile, the agents were simultaneously working in Columbus where their ask was much bigger of Householder: to ensure that the Ohio Lottery Commission, and not the Ohio Casino Control Commission, oversaw the new gambling industry to help their business.
“Pay to play is sometimes referenced as quid pro quo,” said FBI agent Nathan Holbrook, who testified in the Householder trial on Tuesday, and introduced the secret recordings. “It means that I’ll do something for you, if you do something for me in return.”
When Holbrook transferred from Indianapolis to the Cincinnati field office on January 4, 2018, he picked up several open public corruption cases because of his specialty in overseeing crime that is often difficult to prosecute.
Holbrook became the lead agent on the Sittenfeld case. And he opened an investigation into Householder proxy Neil Clark, after he listened to secretly recorded phone calls of Clark that were obtained through an FBI wiretap.
Throughout 2019, Holbrook oversaw the undercover agents in both probes, which ultimately led to arrests a year later of three Cincinnati City council members; and separately of Householder and four Columbus political associates.
Attorney David DeVillers said in a July 2020 news conferenceannouncing the Columbus arrests that it was, “likely the largest bribery, money laundering scheme ever perpetrated against the people of the state of Ohio.”
A grand jury indicted Householder and four associates with racketeering conspiracy for being part of a criminal enterprise. They allegedly took nearly $61 million from Akron-based FirstEnergy Corp. and funneled the dark money through a nonprofit, Generation Now, to build a power base for Householder and pass a $1.3 billion bailout for two nuclear plants.
Two defendants pleaded guilty: lobbyist Juan Cespedes, who testified this week, and political advisor Jeffrey Longstreth, who is expected to testify later in the trial.
Clark was also indicted, but he took his own life a year after his arrest. He died from a gunshot wound to the head in March 2021, while wearing a blue “DeWine for Governor” T-shirt, according to his Florida autopsy report which was reported by numerous media outlets.
Clark’s voice was the prominent one heard through hours of recorded calls and meetings with undercover agents Rob, Brian and Vinny on Tuesday. But jurors will never know what happened to him, a judge ruled.
Householder and former Ohio GOP chair Matt Borges have maintained their innocence and are facing the jury together in a trial that began on Jan. 23, was delayed twice for COVID, and is expected to last through next week.
“It’s an important case, it’s a complex case and I think it’s hard for people follow it unless they’re willing to follow it day in and day out,” said Northern Kentucky University law professor Ken Katkin, who was a frequent spectator in the Sittenfeld case and in the current trial.
On Monday Cespedes told jurors, “I am guilty … I’m not proud of it,” as he described his role as a key middleman in the scheme as a lobbyist for FirstEnergy.
Katkin believed his testimony may be impactful.
“I think jurors would assume that if someone’s already pleaded guilty to paying a bribe, then that means that someone must be guilty of receiving the bribe,” Katkin said.
FirstEnergy representatives signed a deferred prosecution agreement with prosecutors in July 2021 and agreed to pay a $230 million fine. The public utility holding company admitted it conspired with public officials and others to pay tens of millions in exchange for bailout legislation.
Here is some of what Clark revealed during numerous phone calls and meals with FBI undercover agents from May to September 2019, that were played for jurors on Tuesday
- He told agents that he is Householder's proxy, spoke to him two to three times every day, and never took a day off from working for him: "Every politician has to have somebody who is the hitman."
- He described Gov. Mike Dewine, "I don’t want to say he’s a pay-to-play guy, but he’s clearly influenced by his friends who have money,” and he is “clearly a governor who plays to special interests, particularly people he’s had a long relationship with … he’s clearly influenced by … money.”
- He said FirstEnergy has “deep pockets,” and “we call it FirstEnergy, the bank.”
- He said if there were no rules or limits on free trips, Rep. Bill Seitz, “would fly to Dubai first class.”
The last time agents met with Clark, Householder and others was during a four-hour dinner at Aubergine Private Dining Club near Columbus, where Brian paid the $2,720 bill.
Holbrook said the agents had planned to give Householder a $50,000 check that night, but never did. Clark said they could not give the check directly to Householder, that it would have to go through Generation Now lobbyist Longstreth.
During a phone call the day after the dinner, Clark said the donation might be better spent on a separate 501c4 nonprofit that would help extend term limits so that Householder could stay in power longer.
In the end, the undercover agents did not have any further meetings with Clark or Householder after that September 2019 dinner. It became a passive relationship where the agents would return calls or texts but did not initiate any, Holbrook said.
“We were still involved in multiple other undercover investigations … we didn’t want to hurt their (undercover agents) credibility in those investigations,” Holbrook said.
That same month, in September 2019, Sittenfeld met the undercover agents Rob, Vinny and Brian at a Columbus hotel. The group talked about their hotel project, and Sittenfeld said he could create a "controlled environment" using the city's zoning code to allow sports betting only at their location, according to a video recording of the meeting.
A jury convicted Sittenfeld of bribery and attempted extortion, after he accepted $40,000 in campaign donations from the undercover FBI agents.
Sittenfeld was never accused of taking any money for personal gain. He has not yet been sentenced.
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