MLM Counties News. Notices. Need-to-know Information.
Former Missouri Gov. Roger Wilson pleaded guilty Thursday to misappropriating $5,000 from a state-backed workers’ compensation insurance company.
Wilson’s admission came at an unscheduled court appearance in St. Louis before U.S. Magistrate Judge Mary Ann Medler, the U.S. Attorney’s Office for the Eastern District of Missouri said. The plea came just one day after a federal grand jury indicted him and St. Louis real estate development lawyer Edward J. Griesedieck III for the crime. The charges were announced Thursday morning.
“The bottom line is Roger Wilson made a mistake,” said Wilson’s attorney, Robert Haar, of Haar & Woods in St. Louis. “He’s accepted responsibility, and he pled to a misdemeanor. That doesn’t change all the good things he’s done for the state of Missouri.” Sentencing is set for 1:30 p.m. July 9.
Griesedieck was expected to enter a similar plea on Friday afternoon, said his attorney, Matt Schelp, of Jensen Bartlett & Schelp.
Wilson was the CEO of the Missouri Employers Mutual Insurance Co. until last June, when he was ousted without a public explanation. According to the indictment, Griesedieck, formerly of Herzog Crebs, allegedly made a $5,000 contribution to the Missouri Democratic Party in 2009 and then included the cost of the contribution in legal bills to the insurance company.
The U.S. Attorney’s Office alleged that the contribution was originally done at the direction of an MEM board member, Douglas Morgan, and that Wilson approved the payment. Morgan, who resigned from MEM in May 2011, died in November. No other members of the MEM board of directors approved the contribution or authorized its reimbursement, according to the indictment.
“As a result of defendants’ and Douglas Morgan’s conduct, the public records of the State of Missouri incorrectly reflected that the August 27, 2009 $5,000 contribution to the Missouri Democratic Party was made by Herzog Crebs when, in fact, the funds came from MEM,” the indictment says.
A. Fuller Glaser Jr., a partner and member of Herzog Crebs’ management committee, said Griesedieck withdrew from the firm earlier this week.
“Herzog Crebs regrets the unfortunate misjudgments of former partner Edward Griesedieck, which were contrary to our values,” Glaser said. “We also regret not having sufficient safeguards in place at the time. We have since strengthened those safeguards to prevent future incidents. Herzog Crebs remains dedicated to ethical conduct and the highest standards of our profession.”
An email to the Missouri Democratic Party seeking comment wasn’t immediately returned.
The indictment alleges that in December 2009, Morgan asked Griesedieck to make a second contribution of $3,000. Griesedieck sought reimbursement from MEM the following summer, but the company’s in-house counsel questioned the payment.
According to the indictment, Wilson initially denied any knowledge of the contribution or the reimbursement arrangement, but he later issued a personal check to Herzog Crebs to cover the amount of the second contribution, so MEM didn’t suffer a loss.
Jennifer Peck, a spokeswoman for the company, said in an emailed statement that it expects to be reimbursed for the original $5,000 contribution, though it was not clear who was to pay it.
“MEM initiated and has completed thorough internal and external, independent investigations that confirmed there have been no other similar incidents at MEM. MEM cooperated fully with the Missouri State Auditor and Missouri Department of Insurance examiners in the same regard,” she wrote.
The U.S. Attorney’s Office said the misappropriation charge is a class A misdemeanor, which could lead to up to one year in prison and a fine of up to $100,000.
Wilson, a Democrat, was Missouri’s lieutenant governor from 1993 to 2000. He briefly served as Missouri’s governor following the death of Gov. Mel Carnahan in a plane crash in October 2000.
The Missouri Legislature created MEM in 1994 to help provide small businesses with workers’ compensation insurance. The company, headquartered in Columbia, doesn’t receive any state funds. But it enjoys tax-exempt status, in part because three of its five board members are confirmed by the governor. (Morgan, the deceased board member who allegedly directed the contributions be made, was elected by policyholders.)
A state audit released in February said MEM’s “independent public corporation” status gives it an advantage over privately held competitors, allowing it to accumulate a $163 million surplus and to dominate the workers’ compensation market in Missouri. State lawmakers have discussed privatizing or restructuring the company.
The case is U.S. v. Wilson et al., 4:12-cr-156.
Related
Roger Wilson indictment (PDF)
