Ex-prison chief admits to kickbacks
James Crosby, who was forced to resign in February, pleads guilty to a charge that he and a partner took $135,000 to secure prison business for a friend.
By LUCY MORGAN
Published July 6, 2006
Former Florida prison chief James V. Crosby Jr. admitted taking thousands of dollars in kickbacks from a Gainesville businessman and friend who wanted a piece of the prison system's commissary business, according to court documents filed Wednesday.
Crosby, 54, and Allen Clark, 40, a former regional director of prisons in North Florida and a Crosby protege, were charged Wednesday with jointly accepting more than $135,000 between October 2003 and February 2006.
In return for favorable consideration at sentencing and a guarantee against other criminal charges, the two former prison officials agreed to plead guilty to a single charge of accepting kickbacks. They also agreed to cooperate in an ongoing investigation of others.
U.S. Attorney Paul Perez said the two face up to 10 years in prison and a $250,000 fine. Clark will appear in federal court in Jacksonville today to enter his plea. Crosby will appear on Tuesday.
Besides Crosby and Clark, eight current and former employees of the state Corrections Department were indicted by the statewide grand jury on grand theft charges, accused of taking prison equipment and obtaining services from prison inmates.
Wednesday's charges brought the long-simmering investigation into corruption in Florida's enormous prison system straight to the top. In anticipation of the charges, Crosby was forced to resign as secretary of the DOC in February. All totalled, 21 people have been prosecuted on charges ranging from illegal steroid use to creating a phantom job for a person to play on the prison softball team.
Gov. Jeb Bush, who appointed Crosby and later asked for his resignation, issued a statement: "I am disappointed by this violation of the public's trust and by the abuses committed by those in leadership positions. Our work requires the highest level of integrity. Anything less is unacceptable and undermines the good work done by many capable and committed state employees."
Crosby replaced Michael W. Moore, whose reorganization and privatization efforts made him one of Bush's most controversial appointees.
Crosby began his career in corrections in 1975 and worked his way up through the s-ystem. He was appointed to the top job in January 2003, overseeing a system with more than 88,000 inmates and 59 prisons. By October of the same year, Crosby was accepting kickbacks, according to the federal charges.
Crosby climbed the ladder of success the old fashioned way, using his political skills to curry favor with state officials and the Police Benevolent Association, the union that represents corrections officers. He also established close relationships with lobbyists and the prison vendors who hire them.
Court documents say Crosby and Clark worked together to arrange for Keefe Commissary, the St. Louis company Crosby hired to run the prison canteens, to subcontract some of the work to the Gainesville man.
Although federal documents do not name the Gainesville businessman, federal agents acknowledged last month raiding the Gainesville office of American Institutional Services, a small prison commissary company run by Edward L. Dugger.
Dugger is a longtime friend of Crosby.
According to court records, the commissary deal was hatched in the summer of 2004 at a Suwannee River retreat where Crosby and Clark introduced Dugger to officials from Keefe and encouraged Keefe to give Dugger a subcontract to run canteens at prison visiting parks.
Once the deal was arranged, Clark collected the monthly payments and delivered part of it to Crosby, according to federal officials. The payments grew from $1,000 a month to about $12,000 a month between November 2004 and February 2006.
Dugger, an Allstate Insurance agent in Gainesville, has also sold supplemental insurance policies to prison officials, a practice that was recently halted by Corrections Secretary James McDonough, whom Bush named to replace Crosby.
Dugger did not return telephone messages left at his home and two of his businesses Wednesday. A day after the raid on the office of Dugger's commissary company, state officials ordered the subcontract canceled.
Crosby's downfall may have implications beyond the already battered reputation of Florida's prison system. It may also tarnish a Republican administration that has pushed for more and more private contracts, and it could have political implications for Sen. Rod Smith, D-Alachua, a candidate for governor.
Smith and Crosby are longtime friends, and Smith also is close to Dugger.
Smith did not return calls Wednesday but in May described Dugger as a close friend who has helped him raise campaign money in every political race he has entered. Smith said Dugger told him everything he has done was "done by the rules."
McDonough said Wednesday that he hopes the charges bring an end to a "sorry chapter" in Florida's prison system.
"I think morale, in fact, surges from this, because it brings closure to something that was bothersome," McDonough said. "Good people in this department knew they were not being represented by this small group."
A federal statement outlining the charges indicates that Crosby started to get in trouble shortly after taking over the prison system as he moved to privatize the operation of prison canteens.
Crosby was following the governor's push to privatize government services wherever possible. Before Crosby approved the Keefe contract in October 2003, prison canteens were run by inmates with the profits going to an Inmate Welfare Trust Fund that paid for educational programs, libraries, prison chapels and other services that helped prepare inmates for re-entry into society.
Keefe, a nationwide company that got its start in North Florida, operates prison canteens in other states and was awarded an exclusive contract in Florida that pays the state more than $20-million a year in return for the right to sell candy, coffee, toiletries and other items to inmates.
All of the charges stem from an investigation by the FBI and the Florida Department of Law Enforcement. The current and former officers indicted Wednesday on grand theft charges by statewide grand jurors are:
* Richard Allen Frye Jr., 37, a former corrections colonel who was close to Crosby and Clark.* Paul Lamar Miller, 33, former corrections officer.* Theodore J. Foray, 46, former corrections sergeant.* Bryan Kim Griffis, 36, former corrections sergeant.* Christopher Paul Taylor, 34, current corrections sergeant.* Bobbie Dewane Ruise, 41, current corrections lieutenant* Stephen Randall Parker, 32, current corrections officer.* Lamar Edward Griffis, 49, former corrections sergeant, was charged with accepting unlawful compensation.The three officers still on the payroll were fired Wednesday.
Staff writer Steve Bousquet and researcher Carolyn Edds contributed to this report.