FBI interviews with lobbyists unsealed

State Sen. Jon Woods strode into a building just across the street from the state Capitol, past a secretary and into the office of lobbyist Milton “Rusty” Cranford.

The Springdale Republican lawmaker took off a jacket and pulled up his shirt.

“I’m not wearing a wire,” Woods told Cranford and another lobbyist who was present, according to FBI interviews. “I have people that I have to take care of today. I need my $30,000 by the end of work today.”

Cranford told Woods to, ‘Go f*** himself. I don’t know what you’re talking about,’” according to lobbyist Eddie Cooper.

Woods replied: “I will ruin you on the hill if I don’t have my money at the end of the day.”

Cranford remembered the encounter a little differently: After he refused to hand over money, Woods threatened: “Tomorrow is going to suck for both of us.

Asked what he thought Woods meant, Cranford said: “That he was going to go to the FBI or the authorities.”

The encounter some six years ago, referred to by federal prosecutors as “the Woods extortion attempt,” is contained in FBI interviews with now-admitted felons Cranford and Cooper. The transcripts were sealed from public view until last week.

U.S. District Judge Kristine Baker on July 30 ordered the interviews and other documents redacted and unsealed, after requests from prosecutors and the Arkansas Democrat-Gazette. The redacted documents were made available to the newspaper Wednesday.

The transcripts offer new information and vivid accounts of the early stages of investigation into what has become Arkansas’ biggest political corruption scandal in at least 20 years.

They show how lawmakers, lobbyists and executives of the Missouri nonprofit, Preferred Family Healthcare Inc., tried as early as 2013 to control the damage of the federal investigation, and their fear, anger and disbelief as it unfolded.

Cranford remembered a dinner after the Woods meeting, with then-state Sen. Jeremy Hutchinson at Arthur’s Prime Steakhouse in west Little Rock.

Hutchinson, a Little Rock Republican, said a grand jury was investigating Woods and three lobbyists — including Cranford himself.

“I like to threw up at Arthur’s when he said that. Really,” Cranford told the FBI.

The documents also demonstrate federal authorities’ interest, as recently as early this year, in others who haven’t been charged with any crimes.

The transcripts include 28 pages of talk with Cranford dated Feb. 20 this year and a six-page excerpt of a Feb. 16, 2017 interview with Cooper.

Cranford’s interview took place about eight months after he pleaded guilty in June 2018 to one count of bribery involving a federal program. Cooper’s happened about a year before he pleaded guilty in February 2018, to one count of conspiracy to embezzle.

Woods is no longer a senator, convicted May 3, 2018, of taking kickbacks for directing state funds to a small religious school and to the Preferred Family behavioral health care nonprofit.

Hutchinson, who resigned his Senate seat in August 2018, pleaded guilty June 24 to accepting multiple bribes and committing tax fraud.

The Democrat-Gazette sought responses from attorneys for Hutchinson, Woods, Cranford, Cooper and from others named in the transcripts. Most did not return calls or emails late last week. Hutchinson’s lawyer, Tim Dudley of Little Rock, declined to comment.

The federal probe that started at least six years ago in Arkansas grew into a two-state investigation into elected officials, lobbyists and nonprofit interests who exchanged political favors for cash. It is still ongoing.

Those convicted so far in Arkansas and Missouri include five former Arkansas legislators, lobbyists from both states and former executives with Preferred Family, which was paid millions in Arkansas Medicaid funds.

In the interviews, federal investigators asked Cranford and Cooper to remember events back to at least 2013. In some instances, they struggled to place dates for what they say happened. Cooper eventually set the time of the Woods encounter as mid-2013. No date is noted in the Cranford transcript.

The two were not sworn under oath for the interviews, as witnesses are in criminal trials. Making a false statement to a federal investigator is a crime.

WHY THE MONEY?

Cranford had been trying to avoid Woods, he told investigators, because he knew the senator was going to demand money.

“I wasn’t going to give him anymore money,” Cranford said. “I’d give him enough.”

Both Cranford and Cooper were asked why they thought Woods needed $30,000 or more that particular day.

Cranford said: “I don’t have a clue…I mean, and even if he told you, I mean, it wasn’t going to be the truth. I mean, his car broke down 19 times.”

Cooper said his theory was that Woods had other influential people he needed to pay off.

“I think one of them he was talking about was Michael Lamoureux, president of the [Arkansas] Senate at the time,” Cooper said.

As senators, Lamoureux and Woods were instrumental in getting a large state General Improvement Fund grant in 2013 for Preferred Family Healthcare, Cooper told the FBI. The nonprofit was then known as Alternative Opportunities Inc.

“Michael worked whatever magic with the governor’s office to say, ‘Hey, we’re going to give this guy $2 million,’” Cooper said.

Although Cooper’s interview set the grant amount at $2 million, other court records have shown that Cranford applauded Woods’ work on a grant for $1 million.

“So you think Woods owed Lamoureux some money based on that transaction?” an FBI agent asked.

“That’s what it sounded like,” said Cooper, a former Arkansas House member from 2005 to 2011. “I don’t know who else he would have owed it to, because Lamoureux was the one who could say, yeah — because if you’re president of the Senate, you get to say where it’s going.”

Lamoureux, who left his Senate seat in November 2014, to become chief of staff for Gov. Asa Hutchinson, has not been charged with any crime.

He left the governor’s office job in May 2016. He could not be reached for comment Friday. In earlier interviews related to the political corruption scandal, Lamoureux has denied wrongdoing.

CALL JEREMY HUTCHINSON

After Woods made his financial demand, he wrote the amount he needed — $30,000 or $35,000, the best Cranford could remember, $30,000 in Cooper’s mind — on a note and handed it to Cranford, according to the interview transcripts.

Immediately after Woods left his office, Cranford said he called Jeremy Hutchinson, who was Cranford’s personal attorney as well as an important political connection.

Jeremy Hutchinson arrived about 20 minutes later. Cranford and Cooper recounted the Woods demand, Cranford said.

“Are you serious?” Hutchinson asked. Cranford showed him the note, which Hutchinson pocketed and later said he lost, the Cranford transcript says.