An undercover federal agent testified Wednesday in the racketeering and fraud trial of Tommy Nelson that the former New Roads mayor asked for cash bribes in 2009 after deciding stock payments could expose an illegal scheme.
FBI Special Agent Mike McKinney testified in Baton Rouge federal court that he posed as a corrupt executive of a garbage can cleaning business when he met Nelson in April 2009.
McKinney said another undercover FBI agent and a paid undercover operative already had promised Nelson $20,000 in stock of an electronic medical records company.
McKinney told Assistant U.S. Attorney M. Patricia Jones that the stock was payment for Nelson’s pledge to obtain municipal business for the can cleaning company, Cifer 5000.
Cifer 5000 actually was a fictitious company used in an FBI sting operation that resulted in Nelson’s indictment and those of six other municipal officials in Port Allen, St. Gabriel and White Castle. The investigation was dubbed Operation Blighted Officials.
McKinney testified that he told Nelson payment in stock was too risky because it could leave a paper trail between the mayor and Cifer 5000 officials.
“It is illegal for him to be doing what he was doing on behalf of Cifer,” McKinney added for the jury of five women and seven men.
“I told him (Nelson) that cash was better than a stock deal,” McKinney said. “The offer was $10,000 now … and then another $10,000 once the Cifer trucks hit the ground.”
McKinney later added: “I paid him $5,000 on Sept. 24 (2009) … and $5,000 in October (2009).”
Nelson’s attorneys, Page A. Pate, of Atlanta, and Michael A. Fiser, of Baton Rouge, notified Chief U.S. District Judge Ralph E. Tyson prior to the trial that they may argue for dismissal of all charges because of entrapment by undercover agents.
“Did he (Nelson) ever say he did not want to receive anything of value?” asked Jones, the prosecutor.
“No,” said McKinney.
In late April 2009, Nelson had an unrelated business meeting in Atlanta, where he also agreed to meet McKinney, the agent testified.
“He asked me for tickets to a basketball game between the Atlanta Hawks and Miami, a playoff game,” McKinney said.
McKinney said he paid a total of $270 for two tickets and gave them to Nelson during a meeting at an Atlanta restaurant.
In May 2009, the two men met at a restaurant in New Roads.
McKinney said Nelson informed him that he preferred payment in the form of stock in the medical records company to cash.
That changed in July 2009, McKinney testified, after Nelson saw news reports of a round of FBI arrests on the East Coast.
“I was involved in helping set up that (East Coast) case behind the scenes,” McKinney testified.
Among others, the FBI agent said, “three mayors, two state legislators … and five rabbis were arrested.”
“I appreciate more what you were telling me,” Nelson said in a recorded July telephone conversation with McKinney. “Maybe it would be best if I not move forward with that particular thing.”
“Gotcha,” McKinney replied.
Jones asked McKinney to interpret that conversation.
“He (Nelson) was asking me for cash,” McKinney testified. “He wanted to switch and do it the other way I suggested.”
“Did you ever give him (Nelson) the opportunity to back out of that,” asked Jones.
“Sure,” McKinney said. “He never took the bribe off the table.”
In a telephone conversation recorded on Aug. 11, 2009, Nelson told McKinney: “I’m backing out of the records deal. That’s off.”
“Do you want to move forward on that other thing?” McKinney asked Nelson.
“Yeah,” the mayor responded.
On Wednesday, Jones asked McKinney to explain “the other thing.”
McKinney said Nelson was telling him he wanted $20,000 in cash.
Testimony in the trial is scheduled to resume Thursday morning.