A 50-page FBI affidavit made public Tuesday offers the most detailed glimpse yet into the kickbacks-for-contracts plot featuring former Personnel Cabinet Secretary Tim Longmeyer as a cash-raking central figure.
The statement by FBI Special Agent James Huggins was filed March 24 in support of FBI raids and Longmeyer’s bribery charge the following day. It was unsealed and obtained by the Lexington Herald-Leader, which posted it on its website.
In the affidavit, Huggins expands on the government’s basic thesis that Longmeyer and one other person — whose name is removed — arranged to give a consulting company more than $2 million worth of contract work in return for $212,500 in kickbacks.
Longmeyer pleaded guilty to bribery on April 19. Here, thanks to the Huggins affidavit, is a new rundown of the government’s findings, suspicions and possible course of action:
- For the first time, MC Squared Consulting of Lexington and Sam McIntosh are identified as the consulting company and its owner. In addition to Longmeyer, McIntosh and MC Squared employee Myron Harrod, the government has probable cause to believe four other people — all unidentified — committed fraud, bribery, extortion, money laundering, conspiracy and racketeering.
- According to one of the government’s four confidential sources, McIntosh said that he was approached with the scheme proposal in 2009 and directed to propose a focus group project for Humana at a certain price and to “kick back” part of the proceeds to a person whose name is blacked out. Humana administered the Kentucky Employees’ Health Plan for the Personnel Cabinet.
- One of the “goals” of the conspiracy was to funnel a portion of the kickback payments into the 2015 election campaigns of politicians, including Attorney General Andy Beshear and unsuccessful gubernatorial candidate Jack Conway.
- Until February 2014, someone other than McIntosh made the kickback payments to Longmeyer and another unnamed person, an informant said. From then on, Longmeyer told McIntosh to “deal directly with (him) going forward,” the affidavit states.
- Huggins believed that MC Squared did “low-quality” work for Humana to keep expenses down and leave more money for kickbacks. And after Longmeyer and an unnamed person saw fit to get the consultancy a contract with Humana’s successor, Anthem, MC Squared billed Anthem $48,000 for a telephone survey — a fraction of its cost — and gave $22,500 of it to Longmeyer, some of it for political campaigns.
- In a conversation recorded by an FBI informant, McIntosh said he “does not know what Longmeyer does with the cash kickbacks” and that a person, whose name was removed from the document, told McIntosh that he “shouldn’t care.”
- The investigation confirmed that MC Squared did work for the Beshear campaign. An informant, FBI Agent Huggins wrote, said that Longmeyer directed someone to “repackage” the MC Squared invoice as coming from an unidentified company. Beshear’s office said it does not show a payment to MC Squared and was not aware of any work being farmed out to it.
- McIntosh told one of the FBI’s sources that “we’re going to be doing work” for the Attorney General’s office under Beshear. Asked what kind of work, McIntosh said, “jury studies.” Beshear’s office said it neither hired MC Squared nor planned to.
- One of the informants said McIntosh disclosed a “new consulting project” for a client. The work would involve focus groups and would probably require a $3,000 kickback. “I don’t care,” McIntosh allegedly said. “A lot cheaper than Tim. A lot cheaper than Tim.”
- Based on his informants, Huggins said he has probable cause to believe that McIntosh and Harrod possessed and sold marijuana.
Harrod declined to comment. McIntosh could not be reached. (Read KyCIR’s coverage of the Longmeyer corruption case)
On Wednesday, Andy Beshear announced that his office has been “gathering information” and is preparing to file state charges against Longmeyer, who was his chief deputy the first three months of his term as attorney general.
Reporter James McNair can be reached at email@example.com and (502) 814.6543.