Former Springdale senator, Alma consultant found guilty in GIF kickback, bribery scheme

After hearing evidence for more than three weeks in U.S. District Court in Fayetteville, a federal jury returned a guilty verdict late Thursday afternoon (May 3) against former Republican Sen. Jon Woods of Springdale and consultant Randell Shelton, of Alma, for their involvement in a widespread kickback and bribery scheme.

Woods, 40, was convicted of one count of conspiracy to commit honest services mail and wire fraud in violation of federal law, 12 counts of honest services wire fraud, one count of honest services mail fraud and one count of money laundering. Shelton, 38, was convicted of one count of conspiracy to commit honest services mail and wire fraud in violation of federal law, 10 counts of honest services wire fraud and one count of honest services mail fraud.

Acting Assistant Attorney General John Cronan of the Justice Department’s Criminal Division, and Duane Kees, U.S. Attorney for the Western District of Arkansas, began prosecuting the case against Woods and Shelton on April 10 before U.S. District Judge Timothy Brooks in Fayetteville.

“Jonathan Woods abused his position as an Arkansas State Senator by soliciting and accepting kickbacks and Randall Shelton covered it up by funneling the kickbacks through his consulting company,” said Cronan. “The Criminal Division is committed to preserving the public’s confidence in our government by investigating and prosecuting corrupt public officials and those that help them conceal their crimes.”

In an unusual move after the trial, Kees issued a statement with the guilty verdict condemning Woods and Shelton for abusing the public trust. His letter also included a stern warning that others involved in such behavior will bear the same consequences.

“This verdict was the culmination of a three-year long investigation by the FBI, IRS and U.S. Attorney’s Office. Let this verdict be a warning that those who are given the trust and confidence of the people have a responsibility to the people,” Kees wrote. “When that responsibility is disregarded and the people’s trust is replaced with acts of bribery, betrayal and self-enrichment, there will be consequences. Those consequences will be severe and our justice system will have no patience for your position, your last name or the circles of influence in which you reside.”

According to evidence presented at the trial, federal prosecutors said Woods used his official position as a senator to appropriate and direct government money, known as General Improvement Funds (GIF), to two nonprofit entities by, among other things, directly authorizing GIF disbursements and advising other Arkansas legislators – including former State Rep. Micah Neal, 43, of Springdale, to contribute GIF to the nonprofits.

Specifically, Woods and Neal authorized and directed the Northwest Arkansas Economic Development District, which was responsible for disbursing the GIF, to award a total of approximately $600,000 in GIF money to the two nonprofit entities. The evidence further showed that Woods and Neal received bribes from officials at both nonprofits, including Oren Paris III, 49, of Springdale, who was the president of Ecclesia College, a private Christian school.

Woods initially facilitated $200,000 of GIF money to the college and later, together with Neal, directed another $200,000 to the college, all in exchange for kickbacks. To pay and conceal the kickbacks to Woods and Neal, Paris paid a portion of the GIF to Shelton’s consulting company. Shelton then kept a portion of the money and paid the other portion to Woods and Neal. Paris also hired Woods’ friend to an administrative position at the college.

Neal pleaded guilty on Jan. 4, 2017, before Judge Brooks to one count of conspiracy to commit honest services fraud. Paris pleaded guilty in the same court on April 5, 2018, to one count of honest services wire fraud. Sentencings for all parties will be scheduled later.

The guilty verdicts against Woods and Shelton is the latest case of an Arkansas lawmaker getting caught up in the broadening federal probe over the handling of GIF funds. On Monday, former state legislator Henry “Hank” Wilkins IV of Pine Bluff pleaded guilty to conspiring to accept over $80,000 in bribes in exchange for influencing Arkansas state legislation and transactions, including steering approximately $245,000 in GIF funds to his co-conspirators.

In late February, U.S. Attorney Timothy Garrison for the Western District of Missouri announced that Milton Cranford, a former Little Rock lobbyist, had been indicted by a federal grand jury for his role in a nearly $1 million bribery conspiracy involving the Missouri nonprofit.

That indictment alleges Cranford and co-conspirator Eddie Wayne Cooper, a Democrat who served in the legislature from 2006 through 2011, received $264,000 in secret kickback payments from co-conspirator Donald Andrew Jones of Willingboro, N.J., who was paid nearly $1 million by the Springfield nonprofit in a bribery scheme that lasted almost six years, from February 2011 until January 2017.