The former executive director of South Arkansas Youth Services has pleaded guilty to a federal conspiracy charge in connection with the public corruption investigation that has ensnared several former elected officials, according to court documents filed Thursday.
Jerry Walsh pleaded guilty to conspiracy to commit offenses against the United States. Walsh diverted more than $100,000 in agency funds to an Arkansas state senator — identified only as “Arkansas Senator C” — with the understanding that the lawmaker would “take favorable official action to benefit” Walsh, the agency and others, according to the plea agreement.
Walsh met the lawmaker in May 2013 and discussed his agency’s need to stop state agencies “from threatening to pull state contracts,” the pleading says.
From July 1, 2013 through Nov. 11, 2014, Walsh directed roughly $123,750 in agency funds to the lawmaker without the knowledge of the agency’s board of directors, court documents say. The senator also worked as a private attorney, and the payments were made as a retainer and legal fees.
Jerry Walsh guilty plea documentsView All
Walsh understood that in exchange for the legal fees, the lawmaker would work to preserve the agency’s existing state contracts and influence state officials from “taking negative action” against the agency, the pleading says.
Former Arkansas lobbyist Rusty Cranford, who pleaded guilty last month to bribing public officials, connected Walsh to the senator and determined how much the senator would be paid, court documents say.
As part of an agreement with Cranford, Walsh locked his agency “into a more expensive contract with Cranford’s lobbying firms and employ a relative of Cranford who would have a ‘noshow’ job with SAYS,” according to a press release from U.S. Attorney Duane “DAK” Keys. “Between the new contract with the Cranford lobbying firm and the payment for the no-show job, the nonprofit paid out an additional $262,000” without the knowledge of its board of directors.
Four former lawmakers and a Pennsylvania-based political consultant have been convicted in connection with the U.S. Department of Justice probe in Arkansas and Missouri.
Walsh’s case was filed in the U.S. District Court for the Western District of Arkansas. Walsh waived the indictment while pleading guilty.
Read Friday's Arkansas Democrat-Gazette for full details.