Former state senator Jeremy Hutchinson sentenced in corruption case

Former Arkansas Sen. Jeremy Hutchinson (left) arrives in 2018 at the federal courthouse in Little Rock with his father, former U.S. Sen. Tim Hutchinson. 
(File Photo/Arkansas Democrat-Gazette)
Former Arkansas Sen. Jeremy Hutchinson (left) arrives in 2018 at the federal courthouse in Little Rock with his father, former U.S. Sen. Tim Hutchinson. (File Photo/Arkansas Democrat-Gazette)

SPRINGFIELD, Mo. -- Former Arkansas Sen. Jeremy Hutchinson, the son of a former U.S. senator and nephew of a soon-to-be announced presidential candidate, received a 50-month prison sentence Tuesday in federal court for corruption.

Hutchinson is one of five former Arkansas lawmakers convicted after a federal Medicaid fraud investigation, along with six health care company executives and lobbyists.

The 5o months was added to the 46 months Hutchinson was sentenced to in Arkansas. He now faces a total eight years in prison

Hutchinson served as chairman of the Arkansas Senate's Judiciary Committee, which oversees legislation regarding criminal law, from 2013 through 2018. He resigned from the Senate in August 2018 after his indictment.

Executives Tom and Bontiea Goss at Preferred Family Healthcare of Springfield, Mo., conspired to hire then-state Sen. Hutchinson as an attorney for the firm, according to their guilty pleas in the case. In return, Hutchinson helped steer state contracts and grants to Preferred Family. The company's Arkansas lobbyist, Milton "Rusty" Cranford of Little Rock, hired Hutchinson as the company's attorney in 2013.

Cranford also paid kickbacks to then-Sens. Jon Woods of Springdale and Henry "Hank" Wilkins of Pine Bluff to help get state contracts and grants for Preferred Family, court records show. Then-state Rep. Eddie Cooper of Melbourne also pleaded guilty in the scheme. Then-state Rep. Micah Neal of Springdale admitted to getting a kickback in an unrelated scheme with Woods to get a state grant for a business venture by Cranford and Tom Goss.

Preferred Family and its subsidiaries received $245 million in Medicaid payments for mental health services in Arkansas for fiscal years 2011-2018 while at least some part of the scheme was in operation, state records show. These payments amounted to one-third more than the second-ranking behavioral health care provider during that time, state records show.

An estimated $20 million of taxpayer money in all went to bribes and kickbacks to those involved in the scheme, according to court records.

At its peak, Preferred Family collected $43.9 million in 2016 from the state's Medicaid-funded mental health program -- one in every seven dollars the program spent that year.

The Gosses used Preferred Family money to provide interest-free loans to their for-profit businesses and pay marked-up vehicle leasing fees to one of their companies, according to court records. Over four years, the nonprofit paid $2 million to lease the vehicles from the Gosses' company, which had leased those vehicles from another company for $1.1 million.

Preferred Family, according to court records, also paid for charter flights from Springfield to the Gosses' second home in Colorado.

Preferred Family contracts were canceled in 2018 by the state at the insistence of then-Gov. Asa Hutchinson, Jeremy Hutchinson's uncle. Jeremy Hutchinson's father is Tim Hutchinson, who served as U.S. senator for Arkansas from 1997 to 2003.

Asa Hutchinson is set to announce his bid for U.S. president at an event on the Bentonville Town Square at 10:30 a.m. .

Preferred Family's board of directors cooperated fully in the federal investigation after the scheme came to light, U.S. Justice Department officials have said. The company later agreed to pay $8 million in settlements with the state of Arkansas and federal governments.

Jeremy Hutchinson pleaded guilty June 24 and 25, 2020, to one count each in three federal judicial districts -- Western and Eastern in Arkansas and Western Missouri -- on charges including accepting bribes and tax fraud. His sentencing remained on hold while he waited to testify in the Gosses' trial. Then the couple entered a plea agreement in September.

Woods and Neal where charged in connection with a $400,000 state grant steered to Cranford and intended to benefit a business venture by Tom Goss. Goss paid the state back after federal investigators began looking into the grant.

Woods was convicted May 3, 2018, of 15 counts of public corruption and is currently serving 18 years in federal prison. According to the Bureau of Prisons, Woods is scheduled for release in mid-2033. Neal cooperated with the investigation. He pleaded guilty and served one year of home detention. Cranford was sentenced to seven years, but was released as a nonviolent offender during the covid pandemic.

Cooper and Wilkins also pleaded guilty in the course of the investigation. Wilkins was sentenced in March to a year and a day in prison and ordered to pay $123,000 in restitution. Cooper's sentencing awaits sentencing in the Gosses' case.

Others who have pleaded guilty are: Marilyn Luann Nolan of Springfield, Mo., Preferred Family's former chief executive officer; Robin Raveendran of Little Rock, former director of operations and executive vice president of the company; and Keith Fraser Noble of Rogersville, Mo., former director of Preferred Family's clinical operations.

Hutchison asked his sentence in Missouri to run at the same time as the 46-month sentence imposed in by federal courts in Arkansas, in which he was charged in both the eastern and western districts in the state.

Hutchinson, 49, of Little Rock, pleaded guilty to both charges in Arkansas in June 2019 in Little Rock to federal charges of bribery and filing a false tax return. U.S. District Judge Kristine G. Baker also ordered him to pay $355,535 in restitution to the Internal Revenue Service and the Arkansas Department of Finance and Administration in the Arkansas case.

Hutchinson pleaded guilty in Missouri's western district to one count of conspiracy to defraud the United States. He faced a maximum prison term of five years, a maximum of three years' supervised release and a maximum $250,000 fine.

Hutchinson is represented in the Missouri case by Tim Dudley of Little Rock and Nancy Price of Springfield, Mo.


Read Jeremy Hutchinson's plea agreement:


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