U.S. Attorney: Ex-Sheriff Gets 15 Years For Corruption, Extortion, Money Laundering

staff reports and press release
Published: October 8, 2008

Former Buncombe County Sheriff Bobby Medford was sentenced on Monday to 15 years in prison, according to the U.S. Attorney’s Office.

A jury found Medford guilty on charges of money laundering, mail fraud, and conspiracy to conduct an illegal gambling business.
The State says Medford accepted money from illegal gambling operators which he used to fund his re-election campaign.

Guy Penland, a retired deputy and former volunteer a tthe sheriff’s office was also found guilty.

More Details
The following press release was issued on Wednesday:
FORMER BUNCOMBE COUNTY SHERIFF BOBBY MEDFORD
and CO-DEFENDANTS SENTENCED IN U.S. DISTRICT COURT
Medford Receives 15 Years for Corruption, Extortion, and Money Laundering
ASHEVILLE, N.C. – Gretchen C. F. Shappert, U.S. Attorney for the Western District of North Carolina, announced that Bobby Lee Medford, 63 years of age, the former Sheriff of Buncombe County, was sentenced on October 6, 2008 in federal court in Asheville to a total period of imprisonment of 15 years, to be followed by three years of supervised release. The sentence also requires Medford to forfeit $287,776 in proceeds of his criminal activities, and to pay to the Court a special assessment of $1,100. The sentencing follows Medford’s convictions in federal court in Asheville on May 15, 2008, following a trial of almost three weeks, of conspiring to enrich himself unlawfully by extorting money from persons involved in the illegal video poker machine business in Buncombe County beginning October 1, 2000 and continuing through December 3, 2006.

Medford was convicted of depriving the citizens of Buncombe County of the right to his honest services, performed free from deceit, favoritism, self-enrichment, self-dealing, concealment, and conflict of interest, by participating in a conspiracy related to illegal video poker machine businesses while employed as sheriff and as a sheriff’s special deputy for Buncombe County. Medford was also convicted of conspiring to obstruct local or state law enforcement, and of conspiring to commit money laundering.

Also sentenced in U.S. District Court in Asheville this week were three of Medford’s codefendants:
John David Harrison, Ronnie Eugene Davis, and Guy Kenneth Penland (see below for details).
At Monday’s sentencing hearing, Judge T.S. Ellis, III, found that Medford had committed perjury during his trial, that he had been the primary organizer and supervisor of the criminal conspiracies of which he was convicted, and that he had abused his position of trust as a public official. Judge Ellis heard arguments by Medford’s counsel that Medford should be allowed to delay commencement of his sentence temporarily because he is scheduled for surgery on October 13, 2008.

The Government objected to the delay, asking to have Medford taken into custody immediately, and stating that the Bureau of Prisons had the ability to provide the necessary medical care. The court, having reserved ruling on that matter until Tuesday, October 7, at 4:00, found that Medford should be allowed to have his surgery as scheduled on October 13 to be followed by a two-week period in which to recover. He ordered that Medford report to federal authorities to begin service of his sentence on October 28, 2008.

Medford’s total sentence consists of 180 months on each of Counts One (Conspiracy to Commit Extortion under Color of Law), Two (Conspiracy to Commit Mail Fraud, Depriving the Public of its Right to Honest Services), Three through Seven (Mail Fraud), and Eight (Conspiracy to Commit Money Laundering); and 60 months on each of Counts Ten (Conspiracy to Obstruct Local or State Law Enforcement) and Eleven (Conspiracy to Operate an Illegal Gambling Business).
The Court ordered that all sentences will be served concurrently.
Shappert is joined in making today’s announcement by Nathan T. Gray, Special Agent in Charge of the Federal Bureau of Investigation (FBI) in North Carolina; Jeannine Hammett, Special Agent in Charge, IRS Criminal Investigations in North and South Carolina; Robin Pendergraft, Director, North Carolina State Bureau of Investigation, and Michael D. Robertson, Director, NC Division of Alcohol Law Enforcement. Substantial assistance has been provided in this ongoing criminal investigation to date by the Sheriffs’ Offices of Buncombe, Cleveland, and Rutherford Counties and the Police Department of Shelby, North Carolina.
As Judge Ellis found in imposing sentence, Medford and his co-defendants at the Buncombe County Sheriff’s Office received, by a very conservative accounting, over $300,000 in bribe payments from various video poker machine operators in Buncombe County.

According to testimony presented at the trial, the corruption scheme began by at least October 2000 and continued until Medford left office, following his re-election defeat, in December 2006. The scheme involved multiple methods of extorting cash by Medford and his sheriff’s office co-defendants, including that companies registering machines in the county pay bribes to get those machines registered, the solicitation of cash payments under the guise that the payers were sponsoring teams at the twice-yearly golf tournaments put on by Medford and his deputies, and more direct outright demands that the poker operators bring cash in to Medford and his co-defendants. Testimony at trial also established that Medford and several of his deputies engineered a scheme in 2006 to convert cash payments into money orders, in false names, in order to convert these bribes into funds that could be deposited into his re-election campaign account.

Evidence presented at the trial included secretly recorded conversations with Medford’s codefendant, Lt. Ronnie Davis, a videotape of a video poker operator bribing the sheriff of Rutherford County (Jack Conner, who was actually cooperating with the FBI in this matter) and then speaking of his bribes of Medford, and thousands of pages of bank records, telephone records, video poker registrations, and expense reports by one video poker company in which the company recorded the dates and amounts of bribes paid to Medford and his co-defendants.

Also sentenced on Monday, October 6 by Judge Ellis in Asheville was co-defendant John David Harrison, 67, of Asheville. Harrison entered a guilty plea on February 27, 2008, to Count One (Conspiracy to commit extortion under color of law). Harrison received a term of 30 months to be served in federal prison, which is to be followed by a three term of supervised release.

Harrison, a former lieutenant at the Buncombe County Sheriff’s Office, had admitted to soliciting and accepting bribes on Medford’s behalf from video poker operators from 2001 through his retirement in 2005. He cooperated with the investigation and testified at trial, and the Government filed a motion with the Court seeking reduced sentence for him to reflect his substantial assistance.

Continuing with the sentencing hearings on Tuesday, October 7, 2008 in U.S. District Court in Asheville, Judge Ellis sentenced Medford’s two other co-defendants: Ronnie Eugene Davis and Guy Kenneth Penland. Davis, 61, of Alexander, NC, received 40 months in prison to be followed by a three year term of supervised release. Guy Kenneth Penland, 77, of Asheville, received 60 months in prison to be followed by a three year term of supervised release.

Davis had entered a plea to all eleven charges of the indictment, without benefit of a plea agreement. At the time of his plea, he admitted that he had solicited and accepted bribe money on behalf of Medford from May 2005, when Medford placed him in charge of video poker machine registrations, through December 2006, when Medford left office. Davis also admitted that he had participated in the scheme in 2006 to buy money orders in the names of fictitious donors with bribe money, so as to deposit the funds into Medford’s campaign account.

The evidence at trial showed that Penland had solicited an accepted bribe money on behalf of Medford from 2000 through 2005. Penland also received over $100,000 from a video poker company over the years as commissions for locating stores to accept video poker machines, and for registering such machines.

The case was handled for the government by Assistant U.S. Attorneys Richard Edwards and Corey Ellis of the U.S. Attorney’s Office in Asheville.

Commending the work of law enforcement, Shappert said, “Investigating and prosecuting illegal activities of fellow law enforcement officers is hard work. It requires mature and dedicated agents and officers, who are willing to devote the time and resources to surveillance, research, and documentation. The citizens of Buncombe County and Western North Carolina are fortunate to have extraordinarily talented and committed agents and officers, who are willing to meet the challenges associated with such a case.”

United States Attorney Shappert added that the federal investigation into possible public corruption related to video poker machine operations is still ongoing.