In the first decade of the new millennia, an old political machine crumbled under the weight of it’s own corruption. The following is a summary of the Daily Oklahoman’s reporting from the Muskogee Federal Courthouse.
Read the full coverage at the Daily Oklahoman.
MUSKOGEE — Mike Mass, once an influential state representative and a past chairman of the state Democratic Party, became Wednesday the latest crooked Oklahoma politician to be sentenced to prison.
Ex-state Rep. Mike Mass, has written a book about his turbulent years in power and disgrace.
A judge ordered Mass to spend two years in federal prison for taking kickbacks to divert taxpayer money to a gaming machine company and a dog food manufacturing company. A prosecutor said Mass, 57, of Wilburton, has a gambling addiction and left his family destitute. The judge ordered Mass to get treatment, if necessary, and to stay out of casinos while on supervision after his release.
Businessman Steve Phipps was sentenced Wednesday to one year and one day in federal prison for paying kickbacks to Mass and two other legislators. Phipps’ companies illegally received almost $2.8 million and he agreed to pay legislators 10 percent in kickbacks. Both Mass and Phipps had faced up to five years in prison.
U.S. District Judge Ronald White showed leniency to Phipps for his “extraordinary” cooperation in an ongoing federal probe of political corruption. The judge said the corrupt things Phipps testified about doing “made my skin crawl.” Phipps said, “I am ashamed of my conduct. I have tarnished the political process … I have tried to make amends.”
The judge ordered Phipps and Mass to together pay $279,258 in restitution to the state of Oklahoma. Phipps, 54, of Kiowa also must pay a $50,000 fine.
Phipps’ supporters included Oklahoma country singer Reba McEntire. The two were classmates in Kiowa schools, beginning in the first grade. “It is not often that people admit their mistakes. It is less often they do something to rectify the problem. Steve Phipps will always be my friend,” she wrote the judge May 17.
Testimony key in federal case
Phipps pleaded guilty to a conspiracy charge in 2007, admitting then he paid kickbacks to three legislators. He also has admitted other wrongdoing, including using straw donors to give excessive contributions to the state auditor’s race and to other campaigns. He was not charged further under a plea agreement with prosecutors that required him to cooperate.
Phipps’ testimony was considered crucial to the conviction of former state Auditor Jeff McMahan. His cooperation also led to criminal and civil proceedings against former state Sen. Gene Stipe and a guilty plea in a criminal case against Stipe’s younger brother, Francis.
In court papers, Phipps’ attorney described him as a business partner and protégé of the "Prince of Darkness,” Gene Stipe. The defense attorney wrote Phipps refused to become one of Stipe’s "fall guys.” Prosecutors said Phipps is one of the few individuals from southeast Oklahoma "who has had the wherewithal to break an apparent ‘code of silence.’” Mass also pleaded guilty to a conspiracy charge in 2007. Randall Erwin, a second former state representative implicated in the kickback plot, was acquitted at trial in April. Jerry Hefner, the third former state representative allegedly involved, was never charged. Prosecutors would not comment Wednesday about Hefner. Prosecutors said Mass "received the bulk of the $279,258 in kickbacks paid for financial favoritism.”
The judge also showed leniency to Phipps because he suffers from a rare medical condition that would be difficult for prison officials to treat long. A urologist reported Phipps might not survive prison. The judge also said he was concerned Phipps’ companies would fail and his employees lose their jobs if he was in prison for long.
After the sentencing, Phipps’ attorney, Dan Webber, said, "Steve is a strong person. I believe he will get through it. He and his wife will do whatever it takes to keep those businesses open.” Phipps sought probation and a fine.
Occasionally an elected official gets caught. But in this case the criminal comes forward on his own. Paul Anderson did just this, in 2002.
The Tulsa World said;In Payne County, District Attorney Paul Anderson shocked the legal profession in 2002 when he admitted embezzling $84,000 over five years. He pleaded guilty to three counts of embezzlement and was sentenced to two years in prison. He served less than nine months but made full restitution. Lt. Gov’s bodyguard quits amid allegations of affair
December 8, 1998 AP
Mrs. Fallin, a Republican who was elected to a second term in 1996, filed for divorce a few weeks after the election. At a hearing, Fallin’s attorney raised an allegation about the lieutenant governor having an affair with an unidentified bodyguard.
In a statement Monday, Public Safety Commissioner Bob Ricks said rumors surfaced in early September about ”alleged unprofessional conduct between a member of the executive security detail and the lieutenant governor.”
The statement said the trooper first denied the allegations, but was again questioned late last month and ”admitted to unprofessional conduct and was permitted to resign. That resignation was accepted last week. His admission did not indicate that sexual activity was involved.”
Lana Tyree, Mrs. Fallin’s attorney, later issued a statement saying the lieutenant governor would have no comment.
”Out of legitimate concern for the privacy and welfare of her minor children through the Christmas holidays, Lieutenant Governor Mary Fallin, having denied the allegations, will not respond to or debate these issues in the media and will make no further public comment,” the statement said. Mrs. Fallin, 43, and her husband have two children, ages 11 and 8.
In court, Mrs. Fallin had said the allegations of an affair with a bodyguard were a rumor started by her husband. At last week’s hearing, District Judge Jerry Bass prevented Fallin’s attorney from pursuing questions about an alleged affair.
In response to a question from his wife’s attorney, Mr. Fallin said he had hired a private investigator to follow her.
Another hearing in the divorce case is set for next Monday.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Sex scandal roils Oklahoma politics:Official accused of having affair with trooperGov. Keating Accused of HypocrisyDecember 12, 1998 Kansas City Star (MO)
Lame Duck Appointee Attempt:
Since 1990, the Republicans controlled the commission when they held 2 of the 3 seats. When Commissioner JC Watts was elected to congress in November of 1994, the lame duck governor, David Walters; sought to give the Democrats control of the Commission by appointing former state attorney general Charles Nesbitt as a temporary successor to JC Watts. Gov. Elect, Frank Keating intended to name Ed Apple to the temporary post. The case ended up being argued before the Oklahoma Supreme Court. Oklahoma’s governor is sworn in a week after the US Congress swears in their members to a new term. The Daily Oklahoman recapped the drama this way…A brief accompanying Nesbitt’s petition claims Watts’ commission seat “was vacant at the latest on Jan. 3, the date of commencement of the congressional term for which Commissioner Watts was elected,” thus allowing Walters to appoint a replacement. Watts says he did not officially resign his commission seat until Jan. 9, after Keating became governor and gained the right to appoint Apple.
The watchdogs over the state-sanctioned monopolies are called “Corporation Commissioners”. But too often they become cozy with the very corporations they are supposed to be watching.
The Tulsa World said;Bribery scandal: Another Tulsan, Bob Hopkins, a former state corporation commissioner who represented Tulsa County for 28 years in the state Legislature, was convicted in 1994 of accepting a $10,000 bribe from a Southwestern Bell attorney. In return, Hopkins had voted to allow the telephone company to use $30 million in overcharges. Hopkins died in 1997 at age 68. Lame Duck Appointee Attempt:
Since 1990, the Republicans controlled he commission when they 2 of the 3 seats on the Corporation Commission. When Commissioner JC Watts was elected to congress in November of 1994, the lame duck governor, David Walters; sought to give the Democrats control of the Commission by appointing former state attorney general Charles Nesbitt as a temporary successor to JC Watts. Gov. Elect, Frank Keating intended to name Ed Apple to the temporary post. The case ended up being argued before the Oklahoma Supreme Court. Oklahoma’s governor is sworn in a week after the US Congress swears in their members to a new term. The Daily Oklahoman recapped the drama this way…A brief accompanying Nesbitt’s petition claims Watts’ commission seat “was vacant at the latest on Jan. 3, the date of commencement of the congressional term for which Commissioner Watts was elected,” thus allowing Walters to appoint a replacement. Watts says he did not officially resign his commission seat until Jan. 9, after Keating became governor and gained the right to appoint Apple.
Many Oklahoma school districts were found to be collecting far more money in property tax than their operations required. That ‘slush fund’ was secretly invested in money markets. As for where that interest income was finally accrued, was even more secret.
Ironically, it was the IRS which blew the lid on this scheme, by insisting that taxes needed to be paid on this interest income.
Roughly a decade after Okscam came to light, a major scandal broke that grew out of the misuse of education bonds issued by school districts. A word about bonds is in order. Federal officials allowed local officials to issue education bonds to tide them over financially tight periods, as when property tax receipts for schools were late coming in. The bonds were never intended as a means for local education officials to make money, a distinction that was to become quite important as the bond scam unfolded.
During the 1980s, a major bond underwriting company, Stifel, Nicolaus, and Co., was active in promoting the use of bonds to finance public projects. Stifel also engaged in promoting candidates for office via contributions to their campaigns. The Stifel bond company formed a political action committee (PAC) to channel political contributions to candidates, and also channeled contributions through company officers and lobbyists. By these means, they could contribute quite legitimately, just as other businesses did.
Over time, their contributions went to large numbers of legislators, executive branch officials, and others in public life. The list of Oklahoma politicians who received Stifel contributions, via perfectly legitimate channels, added up to a “who’s who” of people and organizations in public life. One wonders if those who failed to receive Stifel contributions felt that something was wrong with them.
A major development in the use of education bonds occurred when the legislature in 1987 changed the law governing the issuance of bonds to allow school districts to issue such bonds without a vote of the people. Three of the key legislators on the committee that formulated the changed law were recipients of Stifel contributions via the channels described. Stifel worked closely with the State School Boards Association to pass word to school districts that they could issue the school bonds without a vote locally. Officials of the Association received large sums in fees. By 1990, some 270 school districts, plus some vo-tech schools and a few counties, were participating.
Unfortunately, many of these participating school districts used the school bonds in the wrong way. They used inflated estimates of their education needs and then issued bonds to meet these needs. Since they overestimated needs, they had money from the bonds beyond that needed immediately. They used the extra funds to make deposits in banks, often in Japan, and then drew interest on the bonds in the banks.
At this point the districts were using the bonds not just to meet needs, but also to make money on the interest collected. And they were to find out that, in doing so, they ended up in serious difficulties with the IRS and other federal officials. In 1991, The Daily Oklahoman launched a series of investigative reports on the school bond program. These reports traced the political influence of Stifel in initiating the bond program and in channeling extensive campaign contributions to large numbers of political figures in the state. The impact of these stories was devastating. School districts began dropping out of the program and participation fell drastically. Then federal authorities became interested, including the IRS, FBI and the SEC. Eventually, two of the state’s largest urban school districts were informed that they had misused their education bonds and owed the IRS large sums. Stifel finally pulled out of the state entirely. In 1996, a onetime leading Stifel official, Bob Cochran, was convicted in federal court of misdeeds connected with the education bonds program, although a year later an appeals court reversed Cochran’s conviction. Most noteworthy here is the initiative from within the state, since it was The Daily Oklahoman that led the way, not federal officials. It is true that federal law enforcement authorities did reinforce the work of the reporters. State law enforcement officials never did contribute much. All in all, this state newspaper deserves much credit for leading reform efforts from within.
In 1991 investigative reporting by the state’s leading newspaper, the Daily Oklahoman, averted a potentially major scandal based on the misuse of bonds for education purposes. That education bonds could be a hazard if not properly handled became apparent when the state’s two largest school districts found themselves charged by the IRS with back taxes amounting in each case to several hundred thousand dollars. The metro districts had been using education bonds not as a legitimate supplement to school spending but as a means of making money via interest accrued on the bonds. Initially the education bond program was hugely popular, with many school districts large and small signing on. However, the investigative reports created skepticism and withdrawals. Had these districts not dropped out of the program, they could have been held liable by the IRS just as the metro districts had been. The investigative reporting by the Oklahoman disrupted the bond scam. Federal intervention, apart from the potential IRS threat, was minimal.
Read more: http://newsok.com/article/2445027
Harry Holloway, of the Oklahoma Historical Society Then in 1990 a scandal emerged from the gubernatorial campaign of winner and Democrat David Walters. Walters won, but the campaign was accompanied by a barrage of press reports that he had raised and spent more money that any previous candidate. Investigations by the state attorney general and Oklahoma County district attorney led to charges of campaign violations. Walters finally pleaded guilty to misdemeanor charges. Critics attacked the outcome as letting him escape too easily from more serious charges. Still, the publicity probably moderated some of the worst excesses of campaign finance. And in this case reform had occurred with little federal intervention, in itself a significant gain.
NBC’s “The Tonight Show” host Jay Leno showed the headline to his national television audience and quipped: “It’s no secret now. ” The negotiations concluded Oct. 21 with Walters and his wife, Rhonda, being whisked to the Oklahoma County Courthouse where in a late-night rather secretive court session the state’s chief executive stood before a judge and coolly uttered the word - “Guilty” - to a misdemeanor campaign violation.
The governor’s attorney, R. Thomas Seymour of Tulsa, who elbowed reporters out of the governor’s way, described the seventh-floor courthouse hallway as a scene “straight out of the movies. ” A noisy throng of journalists and television cameramen as well as curious onlookers, had crowded into the courthouse that night to see history unfold.
One of the more prominent politicians convicted in the last 25 years of the state’s history was former Gov. David Walters. Walters pleaded guilty in 1993 to a misdemeanor charge of violating a state campaign law in a plea agreement that dismissed eight felony charges of conspiracy and perjury. The conviction also led to his decision not to run for governor again. Walters, a Democrat, became president of Walters Power International, a company that provides huge electricity-generating mobile plants sometimes located in remote regions. David Hall passed away in the Spring of 2019. He has been living quietly since he left public life on his way to prison.After the terrible governorships of the late 20s & early 30’s, it wasn’t until the 1960s that major scandals again surfaced, and then they did so with a vengeance. Three justices of the Oklahoma Supreme Court were removed from office by impeachment or resignation arising from IRS investigations of reports that justices were taking kickbacks for favorable decisions. A powerful former speaker of the Oklahoma House of Representatives, who had been a dominant figure in state government, was convicted and sent to jail as a result of IRS investigations arising from charges that he failed to report income received in return for political favors. Then in 1975 a former governor, David Hall, was convicted, shortly after leaving office, of misusing his powers of office by trying to direct a state retirement fund to help a friend with a loan. Again, federal officials were the chief agents in cleaning up the corruption. Harry Holloway, of the Oklahoma Historical Society.
In August 1963 I was transferred to Tulsa from Wall Street, in New York, in a corporate headquarters relocation. A month later, on Tuesday evening, September 10, 1963, I attended my first political meeting… the monthly meeting of the Tulsa County Young Republicans.
The guest speaker that evening was Tulsa attorney Walter Hall, Ballot Security Officer for the Oklahoma Republican State Committee. In his speech Hall described in detail the widespread fraud practiced by Oklahoma Democrats in every election. And since Democrats controlled all county and state election boards, the governor’s office, both houses of the legislature, the major law enforcement offices, and the courts, few Republicans were willing to challenge them.
Hall began by explaining that forty-four of Oklahoma’s seventy-seven counties had not provided a secret ballot for voters since statehood in 1907, and that local Democrats regularly used every conceivable illegal device to intimidate voters and to fraudulently control the outcome of elections.
Although state law required that one of the three election officials in each precinct must be a member of the minority party, Democrats systematically recruited loyal party members to register as Republicans so that they could fill the minority positions.
He described how, on election day, after voters had signed the entry log, they were handed a paper ballot and a pencil. And since there were no facilities for marking a ballot in secret, they were obliged to place their ballots on the table and mark them with the three election officials looking on. If the election officials saw a voter mark his/her ballot for even a single Republican candidate, a number of things could happen… none of them good.
Hall explained that, in many Oklahoma counties, the welfare rolls were divided up by precincts and kept on the tables in the polling places. If an individual on public assistance was so unwise as to vote for a Republican, his/her name would be removed from the welfare rolls the instant the voter completed the ballot. In some Oklahoma counties the election officials were so brazen as to keep a trash can next to the ballot box, and any ballot with a Republican vote on it went directly into the trash can. The only ballots in the ballot boxes were straight Democratic tickets.
In other counties they were a bit more subtle and used a technique that Hall referred to as the “lead-under-the-thumbnail trick.” That technique involved breaking the lead from a pencil and tucking it lengthwise under a thumbnail. When the election official took a completed ballot from a voter and the ballot contained a vote for a Republican candidate, the official merely scraped the lead across the face of the ballot, folded the ballot in the normal fashion, and placed it in the ballot box. When the ballot boxes were opened and the ballots were removed, state law required that all ballots with “extraneous markings” be classified as “mutilated ballots” and not counted in the final tally.
In other counties, election officials would allow a thumbnail to grow very long over a period of weeks or months preceding an election. On the day of the election they would file the thumbnail to a sharp point so that, when they took a ballot containing a Republican vote from a voter and prepared to fold it, they merely flicked the sharp nail through the edge of the paper. Ballots with small rips and tears were considered to be “mutilated” and were discarded along with those having extraneous markings.
When the speaker had concluded his remarks and the meeting was adjourned, I didn’t hesitate. I walked directly to the front of the room and approached Mr. Hall. As we shook hands, I said, “I’ve just recently moved to Oklahoma from New York and I’d like to volunteer to form a committee to raise funds and to provide voting booths for all of those counties that don’t have them.”
Hall looked at me, chuckled, and said, “You don’t really think they’ll let you get away with that, do you? The Democrats throw us a bone now and then,” he continued, “or we find them fighting among themselves and we manage to get somebody elected. We’re a distinct minority in Oklahoma and I’m afraid we have to be satisfied with that.” The people standing around the speaker nodded in agreement. “Yeah, that’s right!” they chorused.
I was very disappointed. I thought they’d be angry. As the primary victims of the fraud, I thought they’d be mad enough to do something about it, but they weren’t. They apparently proceeded from the assumption that if they tried, they were bound to fail… and, chances are, they would have. They had asked God for the patience to endure the things they could not change, for the will to change the things they could change, and for the wisdom to know the difference. Unfortunately, they’d put vote fraud in the category of “things they could not change.”
However, on February 8, 1966, I was elected Chairman of the Tulsa County Young Republicans. It didn’t take long for me to conclude that there was one major benefit to being Chairman of the Tulsa County YRs. I knew that if we played our cards right the Tulsa County YRs could do something about vote fraud in Oklahoma.
In mid-February, just days after my election, I created an organization called Operation: Secret Ballot. I appointed five Tulsa County YRs as coordinators, two of whom were also active in the Tulsa Jaycees. We made no public announcements and there was no fanfare… we just did it. More importantly, we had a plan. We knew that very little could be accomplished if the effort was perceived as being a partisan effort. What was needed was a non-partisan front with bipartisan support.
Through the efforts of our two Jaycee coordinators, the Tulsa Jaycees were urged to invite Mr. Hall to be guest speaker at a future meeting. Hall spoke at the June 1966 meeting of the Tulsa Jaycees and the result was totally predictable. They were outraged at what he told them about vote fraud in Oklahoma. We had our non-partisan front.
A Jaycee leader was selected as overall project coordinator, and after a quiet conversation with one or two fair-minded, idealistic members of the Tulsa County Young Democrats… young Democrats who actually believed in honest elections and the rule of law… the project was launched. Operation: Secret Ballot was an organization of mostly Young Republicans, with Jaycee leadership and publicity, and just enough Young Democrats to validate our claim to bipartisanship.
Working with a cabinetmaker from the Jaycees, we designed a voting booth that could be made from simple one-by-two white pine frames, covered with unbleached muslin, and assembled with offset hinges to allow easy folding and stacking for storage.
In late July, the project coordinators sent letters to county election boards in all of the forty-four counties where the secret ballot didn’t exist, informing them that we’d have voting booths available for them, free of charge, by election day, November 8. All they had to do was to decide how many they needed. We would deliver them to their county courthouses during the first week of November.
By mid-August the project assembly line was operational and voting booths were being produced. Every Saturday and every Sunday, from mid-August through late October, the cavernous interior of the voting booth “factory” echoed with the sound of saws, hammers, and staplers. And as the voting booths came off the assembly line they were folded, stacked, and stored along one side of the building. As the weeks passed, our inventory grew and grew.
When responses started coming in from county election boards, we found a mixed reaction. Some counties didn’t respond at all, but among those who did there were both written and oral responses. For the most part, the letters received said, “Thank you! We’ve never been able to afford voting booths in our county.” And they went on to say how many they needed and where to deliver them.
The oral responses were never direct or in writing, they were sent through third party word-of-mouth. Typically, they said, “If you come into our county with your damned voting booths you’ll all go back to Tulsa in pine boxes!”
We had many threats on our lives during the life of Operation: Secret Ballot and, knowing of many instances of violence by Democrats, we took them all very seriously.
In mid-October 1966, Governor Henry Bellmon commented publicly on our election reform project, and within a day or two we were contacted by the Adjutant General of the Oklahoma National Guard. The General informed us that he would make National Guard troops and trucks available to us whenever we needed them. All we had to do was to tell him which counties were to receive voting booths and the number of voting booths to be delivered to each location.
During the first week of November 1966, the National Guard loaded and delivered from eight hundred to a thousand voting booths to counties across the state. Under the glare of public scrutiny, Democrats were afraid not to use them, and on Tuesday, November 8, Oklahoma voters went to the polls and elected a new governor, State Senator Dewey Bartlett, of Tulsa, the second Republican governor in Oklahoma history; they elected a Republican attorney general, Tulsa attorney G.T. Blankenship, the first Republican attorney general in state history; they elected Republicans in two of the state’s six congressional districts; and they elected a Republican state labor commissioner.
We were very pleased that our friend, Dewey Bartlett, would be occupying the governor’s chair for the next four years, but the most significant outcome of Operation: Secret Ballot was the election of a Republican attorney general. Having a Republican attorney general meant that the most powerful Democrat in the state went to prison for eight years, and that a number of State Supreme Court justices… who’d been taking bribes of from $15,000 to $25,000… were impeached and removed from the court. One or two others resigned rather than face the public humiliation of impeachment.
A small group of determined Tulsa County YRs gave the State of Oklahoma the biggest dose of political reform it ever had. The Tulsa Jaycees received the National Community Service Award from the U.S. Jaycees for their role in the project. However, in Republican circles, Operation: Secret Ballot was never mentioned. As the YRs would learn in the months and years to follow, it was typical of the recognition that the Republican Party showers on its most dedicated supporters.
Nevertheless, it is almost certain that Henry Bellmon’s first term as governor (1963-67) and the Operation: Secret Ballot project of 1966 were, taken together, the two political developments that are the basis of the political renaissance that has made Oklahoma the reddest of red states. In 2014, although Democrats still maintained a slight edge in party registration, both U.S. senators, all five members of the U.S. House, the governor, lieutenant governor, and every other statewide office, as well as both houses of the state legislature, were in Republican hands.
Oklahomans can be duly proud of the fact that theirs is the only state in the nation in which in 2012; Barack Obama carried not a single county.
Paul R. Hollrah is a two-time member of the U.S. Electoral College, serving as chairman of Oklahoma’s seven-member delegation in 2004. In 1975 he pioneered the corporate PAC movement, creating and registering the first corporate political action committee with the Federal Election Commission. In 1983 he was the principal founder the National Republican Legislative Campaign Committee, a fundraising arm of the Republican National Committee. A nationally-published blogger, he is retired and resides among the hills and lakes of northeastern Oklahoma.
In 1974 A federal grand jury indicted Winters, for, among other things, of using his position to extort campaign money from banks. Winters was acquitted of four counts during a well publicized trial, and other counts later were dropped. A few weeks after that, he was re-elected.
Winters served five terms and was trying for a sixth when his 1986 campaign was doomed by allegations that a Tulsa bank may have written off millions in loans to him.
In 1986, many Oklahoma banks were on the brink of default from a crash in the oil markets, worldwide. Yet State Treasure Winters, decided to deposit a massive amount of state funds into a non-interest bearing account in Liberty National Bank of Oklahoma.
The Oklahoman reported:
|
Corruption ChronicleA retelling of the dubious escapades our past state leaders have been exposed for their role in. Archives
January 2025
Categories |