Tuesday, April 22, 2014

Report Details "WTF" and "CYA" Moments in AG's Office

Posted By on April 22, 2014, 5:47 PM

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The report of an internal investigation into how the Attorney General's Office has handled the prosecution of convicted white-collar fraudster Marc Sessions Jenson was released Monday. Here are five takeaways from the report about the role of former AG John Swallow in the case, the hair-pulling frustration of AG staff trying to prosecute the case without interference from their boss former AG Shurtleff and other points of concern about Shurtleff's conduct during the controversial case that “defies explanation.”---

In late January 2014 after Swallow resigned from office under the pressure of multiple investigation into allegations of corruption, the office under the direction of Deputy Attorney General Brian Tarbet asked Paul Cassell, a former federal judge and prosecutor and former U.S. Attorney for Utah Francis Wikstrom to investigate the allegations raised by Jenson about his case being impaired by the meddling of former Attorney Generals Mark Shurtleff and John Swallow.

Here's five highlights from the report that you can read in its entirety here.

“What the F***?”

While City Weekly has written extensively about Jenson's use of Tim Lawson, an informal lobbyist and confidant to Shurtleff, to try to influence the outcome of his original 2005 securities fraud case the new report also goes into detail about meddling that seemed to also happen in regards to another fraud case involving Jenson, this one in connection to money he was raising for the development of the Mt. Holly ski resort.

The original fraud case was troubling enough given that Jenson was offered a plea-in-abeyance that originally would have required he pay no restitution to his victims. That offer was so lenient as to be rejected by a judge in 2008 and was orchestrated largely at Shurtleff's request.

The new deal the office brokered gave Jenson three years to pay off $4.1 million to his victims, during which time Jenson courted former AG Shurtleff and his then campaign fundraiser John Swallow at a luxury resort in southern California. The recently issued investigation report highlights some of the frustration staff had working Jenson's first fraud case, especially when Shurtleff in August 2007 passed on an email to prosecutor Scott Reed that showed a response he was drafting to questions raised by a Jenson ally.

The e-mail seemed to shock Reed as it showed how involved Shurtleff was in the case. Reed forwarded the e-mail to Torgensen with the note “What the f****? Just leave it alone huh?”

But the new report also shows how frustrated Attorney General's Office staff were in having to prosecute Jenson on the Mt. Holly case as well as in pushing for a tough sentence when Jenson failed to pay any restitution to his victims from his 2005 case. Jenson in 2011 was subsequently sentenced to prison for up to 10 years on multiple felony counts for his first case.

Ethical Tightrope

While Jenson was serving time on his sentence at Beaver County Jail in 2011 Steve Sperry an investigator for the Attorney General's Office began recording telephone conversation Jenson had (except with his attorney). In these conversations he heard interesting tidbits like Jenson planning to “feign cancer as a sympathy ploy” but more importantly he heard Jenson talking about his strong ties to Swallow and Shurtleff. Sperry took these concerns to prosecutors Che Arguello, Scott Reed and Kirk Torgensen, who in May and June 2011 decided that Shurtleff needed to be screened off from the Mt. Holly case.  They argued that Jenson could manipulate Shurtleff and try to disqualify the whole case because of his connections to Shurtleff. It was exactly this conflict that ultimately led to the Mt. Holly case against Jenson being transferred to the Utah County Attorney's Office in July 2013.

But the warning signs were there from the start, even prior to Sperry listening to Jenson's 2011 jail-house conversations.

In May 2010 for example when investigator Kerry Gallegos had just begun investigating the Mt. Holly case he received a call from Jenson himself saying he heard Gallegos was investigating him and “scaring a lot of people.” Gallegos e-mailed Reed about Jenson's knowledge of the investigation, and forwarded the email to Torgensen, who in reply joked and asked if Reed “was sure he wanted to be a judge.”

Reed in reply said: “No – really I’d much rather sit around and have the Attorney General f*** up my cases,” he then advised Gallegos to tell Jenson to make sure his communications went through proper channels through his lawyer.

After these prosecutors concerns were drafted in a request to screen Shurtleff off the case in June 2011 Shurtleff initially replied “It’s about 5 years too late to screen me off from the current State v. Jenson case.” Though he later conceded and agreed to be walled off from the case because of a perceived conflict of interest.

The report notes that staff were constantly frustrated by the fact that they had to walk an “ethical tightrope” in trying to prosecute Jenson for fraud while knowing at the same time his close ties to their boss, Shurtleff.

Concerns About Swallow and Shurtleff's “Yes Man”

But the men weren't just concerned about Shurtleff they also wanted Swallow walled off, as well as Shurtleff's communications director Paul Murphy. The report repeated the claim Jenson has made to other media that Swallow had sought to obtain a valuable interest in the Mt. Holly project from Jenson, but notes that the claim is uncorroborated. It also notes Jenson saying that Swallow had also asked Jenson for a $200,000 retainer for legal services saying “I'm going to take care of you when I'm AG.” This offer was allegedly before Swallow was a member of the Attorney General's Office.

In the report Torgensen states that Swallow admitted “that he had done some minimal legal work for Jenson, and he therefore agreed that he should be screened off.” Though Torgensen says Swallow at the time didn't disclose that he had joined Shurtleff at the California resort on Jenson's dime during the summer of 2009.

The prosecutors trying to run their case against Jenson also wanted Murphy screened off the case, but did not succeed in walling him off. They cited concerns that Murphy would report to Shurtleff directly about everything that was going on in the Jenson case, calling Murphy Shurtleff's “yes man.” City Weekly has previously reported on Murphy's close ties to Shurtleff and concerns that Murphy may have blurred the lines between his taxpayer-funded role at the agency and his activities campaigning for Shurtleff's elections.

CYA

The report also cites multiple instances where prosecutors say they saw Shurtleff realizing that his connections to Jenson might come back to bite him or Swallow's political futures, causing him to shift into “CYA” or Cover Your Ass mode.

For example when Jenson was sentenced on November 3, 2011 on felony charges that could involve up to ten years in prison, Torgensen reported the sentence to Shurtleff who in an e-mail responded: “Good! Congrats! Despite what some in our office may think, I believe Kensen [sic] is a dirty crook.”

According to the report, prosecutors felt this change of heart was a “CYA effort i.e., an attempt to leave a paper trail that would demonstrate that he was in favor of tough punishment for Jenson when, in fact, Shurtleff had been single-handedly responsible for the earlier plea in abeyance and concessions made to Jenson during the plea process.”

Shurtleff's Behavior “Defies Explanation”

The internal investigation report acknowledges that the scope of its review was limited and that it was unable to get comment from Shurtleff or Swallow based on advice from their counsel. Even still, their ultimate conclusion was to say simply that while it's fair to offer a hearing about whether Jenson's imprisonment is the result of Shurtleff and Swallow's inappropriate meddling, they argue that “we do not believe that Jenson has suffered any prejudice from the way his cases were prosecuted.”  

They do, however, take exception to Shurtleff's insertion into Jenson's cases saying “it defies explanation.” While Shurtleff purported to have an “open-door” policy meaning he would meet with any citizen with a complaint, the report notes prosecutors believing that “Shurtleff was a 'meddler' only when the case involved people who had particular access or influence.”

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