Pastor Jerry Wayne Cox and former 22nd Judicial District Attorney Walter Reed share more than a long friendship, a former parishioner of the Pentecostal preacher claims in a federal lawsuit he filed last year.
The men were also business partners, according to Roger Dale Magee, who in May filed an amendment to his 2014 lawsuit that alleges the preacher threw lucrative personal-injury cases Reed’s way and “helped feed expensive lifestyles led by both men.”
Reed reported income of $714,000 for 2012, according to federal prosecutors.
Cox lives in a mansion, valued at more than $2 million, on a 300-acre estate that he sold to his Washington Parish church, making it tax-exempt.
Reed has described Cox as a close friend and has acknowledged that the minister steered some legal work his way, but he has strongly denied any financial relationship with Cox. He also has denounced the other allegations in Magee’s suit, which maintains that Reed helped keep Magee behind bars for months after Magee spoke with the FBI about the two men.
Now, both men are in the sights of federal prosecutors. Reed was indicted in April on a raft of corruption charges that include making false statements on his tax returns. Cox was charged in a federal bill of information this week with “structuring,” or withdrawing money in increments under $10,000 to avoid having to report it to the IRS.
What’s absent from the document charging Cox, so far, is any charge related to a larger underlying criminal scheme.
Typically, a charge of structuring is accompanied by other counts because it is generally alleged to be part of an effort to conceal criminal activity.
But Cox faces a lone charge of structuring — a possible signal that prosecutors have agreed to pursue a reduced charge against him in return for his cooperation in other matters, such as their case against Reed.
Former federal prosecutor Matt Coman said that based on the facts alleged in the bill of information, the government could have lodged at least seven structuring charges against Cox.
Walter Becker, also a former federal prosecutor, said the government sometimes allows cooperating defendants to plead to structuring rather than more serious financial crimes. “I’ve seen it used in plea deals,” he said.
In one such case, Norco businessman Burnell Moliere in 2008 pleaded guilty to structuring for his role in helping political operative Mose Jefferson pass bribes to Orleans Parish School Board member Ellenese Brooks-Simms.
Not only does the Cox bill of information make no mention of other criminal activity — it makes no reference to Reed.
Reed’s attorney, Rick Simmons, said that’s as it should be because there is no connection between his client and the financial shenanigans alleged against Cox.
Still, he assumes the cases are related, saying he figures the government began taking an interest in Cox because of his association with Reed. “They’re going to investigate everyone around Walter,” he said Thursday.
While Reed has denied paying Cox for steering legal work to him — a practice that would violate ethics rules for Louisiana lawyers — Reed’s campaign records show that in 2013 he cut a $25,000 check from his campaign account to Cox’s church, Faith Tabernacle.
It’s possible prosecutors could contend that payment was illegal. If they charge that the payment — supposedly for a church building fund — was actually some kind of finder’s fee, they could argue that Reed should have counted the campaign money as income and paid taxes on it.
The Reed indictment makes similar charges in relation to other campaign expenditures by the former north shore district attorney.
Simmons said he thinks such a claim involving the Cox donation would be a mistake.
“A donation is a donation, and those are allowed under campaign finance law,” said Simmons, who is trying to make a larger argument in defense of Reed that federal prosecutors lack jurisdiction over Louisiana campaign accounts.
In his still-pending suit, Magee claims Reed and Washington Parish Sheriff Randy “Country” Seal violated his rights when Seal’s deputies used a Taser on him at his aunt’s Franklinton home while trying to arrest him for failing to pay child support. He alleges he was kept in jail, without bail, for more than 100 days because of what his family was told was a “DA hold.”
Magee’s suit says he was targeted because he went to the FBI with allegations about insurance claims made by Cox and about a partnership between Cox and Reed, including “issues about how those cases were settled, and questions about how and to whom settlement proceeds were distributed.”
Magee’s suit says Cox threatened him at a 2012 meeting in Little Rock, Arkansas, saying, “You didn’t scare us much with the FBI; well, you scared us a little.” Cox then warned Magee that if he ventured back into Louisiana, “Reed will handle you,” according to the suit.
Magee claims that the two made good on the threat in 2014.
In his amended complaint, Magee highlights a payment Reed made to First Pentecostal Church in North Little Rock out of his campaign fund — an expense that also was noted in the federal indictment against Reed.
The money paid for a dinner aimed at drumming up personal-injury legal work, Magee claims.
Cox is scheduled for arraignment Aug. 20. His case has been allotted to U.S. District Judge Ivan Lemelle.