First appeared in USA Today
Former Fiesta Bowl Chief Executive John Junker, another
former bowl officer and a current high-ranking bowl employee pleaded guilty
Tuesday to charges stemming from their roles in a fraudulent
campaign-contribution scheme.
Joining Junker in entering pleas in Maricopa County Superior
Court were Jay Fields, the bowl's former vice president of marketing, and Peggy
Eyanson, the bowl's current senior director of business operations.
Junker pleaded guilty to one felony of soliciting a
fraudulent scheme, in which employees made political campaign contributions
that were reimbursed with bowl funds. He faces up to 2 and one-half years in
prison, though probation is available. Sentencing is scheduled for April 26.
Junker, fired by the bowl last spring, also agreed to pay
the bowl $62,500 in restitution, covering the cost of roughly $48,000 in
campaign-contribution reimbursements as well as miscellaneous questionable
expenses.
Fields and Eyanson each pleaded guilty in the same hearing
to one count of making a prohibited campaign contribution, a misdemeanor.
Under the plea agreement, Fields was sentenced to pay a
$4,600 fine and was placed on one year of supervised probation. He was forced
to resign last March.
Eyanson, who will keep her job at the Fiesta Bowl, was
sentenced to pay a $4,500 fine and was placed on one year of supervised
probation. The bowl's attorney, Nathan Hochman, said Eyanson fully cooperated
with law enforcement and helped the bowl's investigators, who uncovered spending
irregularities as well as the reimbursements for campaign contributions.
Junker, according to his attorney, also has reached a plea
agreement with the U.S. Attorney's Office, which also is investigating the
Fiesta Bowl. In that case, Junker will admit to to a single federal felony
charge stemming from similar allegations.
As part of Junker's plea agreement with the state, both
sides agreed that if he receives prison time in both cases he would serve his
initial time in federal prison and would receive credit for his state sentence.
If Junker receives prison time in both cases, the sentences would run
concurrently, according to the state plea bargain.
The U.S. Attorney's Office has neither confirmed nor denied
it has a deal with Junker.
Junker repeatedly said "yes, sir," and "no,
sir" when asked questions by Maricopa County Superior Court Judge Douglas
Rayes as to whether Junker understood the deal. Junker took no questions after
the hearing, but he shook a reporter's hand and wished his family well.
The state Attorney General's investigation began after The
Arizona Republic in December 2009 first reported that current and former
employees said they were reimbursed over nine years for making campaign
contributions at the urging of Junker. Such reimbursements violate
campaign-finance laws. For months, Junker denied the allegations.
The contributions went to local and state politicians who
helped the Fiesta Bowl obtain financial subsidies, and to members of Congress
who supported the Bowl Championship Series, a fraternity of top college
football bowl games including the Fiesta Bowl.
On Tuesday, a factual basis for plea was entered with the
court as part of Junker's plea agreement.
That six-page document says Junker knew it was illegal for
corporations to make donations to political candidates and it was illegal to
pretend to use other people's names to make those contributions. The document
also says Junker instructed Natalie Wisneski, the bowl's former chief operating
officer, to give employees bonuses for engaging in the scheme.
A federal grand jury last November indicted Wisneski on nine
counts, including seven felonies. Her trial in U.S. District Court is scheduled
for March 6, but her attorneys have asked that it be postponed to give them
more time to prepare a defense. Her attorneys attended Tuesday's hearing, but
declined comment.
Attorney General Tom Horne said after the hearing that
others remain targets of the state's criminal investigation, but he declined to
provide specific details.
"Our investigation is still ongoing as to other
potential targets, so I am limited in what I can share with you," Horne
said.
Horne also took a shot at the Fiesta Bowl's board of
directors for a lack of oversight of Junker and spending at the bowl. An
independent investigation, commissioned by the bowl well after The Republic's
2009 story, found widespread financial mismanagement, including the bowl paying
for strip-club outings by Junker, Fields and another former officer, Shawn
Schoeffler.
"Members of a nonprofit board and its officers need to
understand the policies regarding authorized expenditures, salaries and
bonuses," Horne said. "A board of directors needs to create a system
of checks and balances to ensure that the charities serve their mandate."
The Fiesta Bowl issued a statement saying it has fully
cooperated with Horne's office, and has "worked tirelessly on this case to
bring those who violated the law to justice." The bowl also implemented a
series of financial and oversight reforms.
Junker in his plea also admitted that he knew the tax
returns filed by the non-profit entities that run the Fiesta Bowl were false
when they stated that no political contributions had been made. Junker also
stated that the tax returns were false when they stated the bowl did not engage
in lobbying, when in fact a person identified as Lobbyist C and "others
over the years lobbied heavily for the Fiesta Bowl."
The document does not identify Lobbyist C, but during the
court hearing Junker's attorney, Stephen Dichter, said that person was attorney
Gary Husk. The plea deal also said Lobbyist C was involved with the
reimbursement scheme and told Junker that "everyone did it."
Records show Husk was a lobbyist for the bowl from 2000 to
January 2011, but Husk's attorney said Tuesday that his client was not the
bowl's chief lobbyist until 2004 or 2005, and he said Husk repeatedly told the
bowl it was illegal to reimburse employees for making campaign contributions.
Husk has done nothing illegal or unethical, said former
Maricopa County Attorney Rick Romley, a member of Husk's defense team.
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