Inside The Kentucky Firm At The Center Of The FBI’s Corruption Probe

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The Lexington office of MC Squared Consulting.

James McNair / KyCIR

The Lexington office of MC Squared Consulting.

LEXINGTON — Three weeks after the federal government accused Kentucky’s former No. 2 law enforcement official of accepting bribes, the company believed to have made the alleged payoffs is nowhere to be found.

On March 25, FBI agents raided MC Squared Consulting’s office in the colonial-style Richmond Square complex off Man o’ War Boulevard, according to spectators and two company employees. Today, visitors to unit 23 are greeted by a locked door and a paper sign saying “Out of town today.”

Neighboring office workers remain flabbergasted. Two, who asked not be identified, said nearly a dozen FBI agents spent most of that late March day at MC Squared hauling off computers and boxes. One of those workers said she had no idea what the raid was about — or what the company even did.

“It was weird,” she said while taking a smoke break on a recent Friday. “They were very friendly people, but we always wondered what they did.”

What MC Squared did, according to what’s left of its website, was market research. It provided services to people running for public office, like conducting polls, setting up focus groups, developing campaign strategy and buying ads. Running the operation was a 57-year-old Hazard native, University of Kentucky graduate and former Kentucky Democratic Party staffer named Sam McIntosh.

Timothy Longmeyer at a March 2015 Personnel Cabinet event.

Personnel Cabinet

Timothy Longmeyer at a March 2015 Personnel Cabinet event.

Although its offices were pillaged and employees interviewed by the FBI, MC Squared has not been accused of wrongdoing. Only one person was criminally charged the day of the raid — Tim Longmeyer, the state’s former Personnel Cabinet secretary and, until last month, Attorney General Andy Beshear’s chief deputy. The government accuses Longmeyer, during his time in the Personnel Cabinet, of taking more than $200,000 in bribes from an unnamed consulting company in exchange for sending it more than $2 million worth of market research work through state employee health plans.

Kyle Edelen, spokesman for the U.S. Attorney’s office in Lexington, would not say if MC Squared is the consulting firm mentioned in the Longmeyer complaint. The complaint only says that the firm is a limited liability company (LLC). MC Squared is an LLC.

More and more, though, MC Squared appears to be the unnamed company.

An MC Squared employee interviewed by WFPL’s Kentucky Center for Investigative Reporting confirmed the FBI’s investigation of the company. He said MC Squared is “at least suspected of illegal activity.” He asked that his name not be used because he is cooperating with the FBI.

“They came here and talked to me and took some records, but it was pretty mundane and boring stuff,” he said. “They want to talk to me and they want to talk to others. I’ll tell them what I know, and they’ll tell me what they feel about what I say I know. Really, I’m pretty ignorant.”

Another MC Squared employee said she wasn’t at the office during the raid and hasn’t been contacted by the FBI.

“I had no idea about anything,” she said, asking not to be identified because she is waiting for her last paycheck. “I was totally surprised by what happened.”

Efforts to reach McIntosh, by phone, email and in-person, were unsuccessful. One of Longmeyer’s attorneys, Kenyon Meyer of Dinsmore & Shohl in Louisville, declined to discuss his client’s alleged dealings with the consulting firm.

“We’re not going to get into any of of the allegations right now,” he said. Longmeyer is scheduled to appear in federal court in Lexington next Wednesday.

Beginning as early as 2009, MC Squared began conducting employee focus groups for the companies that administered the Kentucky Employees’ Health Plan — first Humana, then Anthem. By then, Longmeyer was “special assistant” to former Personnel Cabinet Secretary Nikki Jackson and signing off on financial transactions, records show. A $151,200 payment to MC Squared in September 2009, part of a Humana contract, was approved by Longmeyer, who signed as “agency head or designee.”

Read the document.

Click to read the Humana contract signed by Longmeyer.

 

Jackson, a member Louisville Public Media’s board, told KyCIR she never had any suspicions about Longmeyer. She then hung up on a reporter.

At least one employee of the consulting firm has been granted federal immunity for his or her “limited involvement” in the bribery scheme, according to the federal complaint. Beginning last May, that employee became the government’s confidential source. With the employee’s help, the complaint states, the FBI determined that the consulting firm not only gave cash to Longmeyer, but also repaid unnamed “third parties” who had written campaign contribution checks to political candidates “specified by Longmeyer.”

The criminal complaint says the government has “no reason to believe” that the recipients of those checks knew that the money was payola. From 2009 to mid-2015, seven MC Squared employees donated a total of $15,500 to Gov. Steve Beshear, Attorney General Andy Beshear, former AG Jack Conway and the Kentucky Democratic Party.

Dewey Clayton, a University of Louisville political science professor and longtime observer of Kentucky politics, said he wouldn’t be surprised if the government filed charges against other people.

“It’s definitely got a bad smell to it,” Clayton said, “and it’s yet to be seen who else may have been involved with this and how far up this actually may go.

“There’s always the possibility for this type of bribery to occur,” he said, “but we pay public officials such that they’re not going to take the illegal route. You hope that won’t happen, but unfortunately politicians are just like anyone else and the temptation is always there.”

According to a client list posted on its website in 2012, MC Squared represented candidates for both of Kentucky’s legislative chambers, as well as candidates for county offices and judgeships.

Conversations with six former clients produced mixed reviews of the firm’s efficacy on their behalf.

“They gave me a lot of computers and election data, which was new technology back in those days,” said Walter “Doc” Blevins, who ran for Congress against U.S. Rep. Hal Rogers in 1994 and is now judge-executive in Rowan County. “They flew me to Washington in a charter jet and set up meetings with the AFL-CIO people and others. I just couldn’t raise the money to be an effective candidate.”

Pikeville attorney Ira Branham said he hired MC Squared to help pick jurors in trials.

“They were very competent, and I was very pleased with the work they did,” Branham said. “They helped me to analyze the people’s attitudes, biases and prejudices — very important stuff.”

Tom Smith, who ran for district judge in Madison and Clark counties in 2008 after retiring as commonwealth’s attorney, said hiring MC Squared and Sam McIntosh was futile.

“If I were to need another campaign consultant, I would not hire him,” said Smith, now in private practice. “Two things stand out: He wanted me to send out a flyer shortly before the election with his help, but he mailed them out too late and people didn’t get it until the day after the election.”

And, at McIntosh’s urging, Smith bought a bunch of campaign advertising “trinkets” that, to his chagrin, were never distributed. “I ended up with a basement full of pen lights with ‘Tom Smith for Judge’ on them,” he said.

McIntosh also struck out for Bill Kelley in his failed 1999 bid for judge-executive of Bell County. He hired MC Squared to do a telephone poll of voters.

“That’s the only time I’ve ever used a poll,” Kelley said. “Their poll had me up by quite a few points, but they missed it pretty bad.”

Today Kelley is mayor of Middlesboro. He said he got there without the help of any consultants.

Reporter James McNair can be reached at jmcnair@kycir.org and (502) 814.6543