Hearing set in Woods kickback case

Published 8 December 2017

FAYETTEVILLE -- Covertly recorded audio files will be the subject of a hearing Dec. 14 in the corruption case involving former Sen. Jon Woods, according to attorneys.

U.S. District Judge Timothy Brooks set the hearing Wednesday concerning 79 recently revealed recordings taken by former state Rep. Micah Neal of Springdale. Neal pleaded guilty Jan. 4 to accepting kickbacks in return for state grants and is expected to testify against Woods.

Neal's recordings are the subject of the Dec. 14 hearing, U.S. attorney's office spokesman Charles Robbins and one of the defense attorneys, Shelly Koehler of Fayetteville, confirmed Wednesday afternoon.

Brooks said last week he will set a trial date after this hearing to consider the impact of the new evidence. Brooks also set a hearing on other defense motions for Dec. 15, according to the court docket.

Woods of Springdale had been set to go to trial Dec. 4 with Oren Paris III, president of Ecclesia College in Springdale; and consultant Randell Shelton Jr. The three are accused of arranging kickbacks to Woods and Neal in return for state grants to the college.

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Other covert recordings by Neal were admitted into evidence in September. Attorneys learned about the 79 additional recordings Nov. 15, according to court documents. Knowledge of the newly disclosed recordings became public after a pretrial hearing Nov. 30. Court records credit Shelton's defense counsel for figuring out there must be more recordings than the government obtained in its investigation.

The government will not try to use the newly discovered recordings in its prosecution, but the defense may use the tapes if the defendants wish, according to court documents.

Neal's plea agreement says Woods, Paris, Shelton and lobbyist Milton R. "Rusty" Cranford all participated in kickbacks in return for state grants. Cranford, an executive in the now-defunct nonprofit corporation Alternative Opportunities and its offshoot, AmeriWorks, hasn't been charged.

The kickbacks were in return for state General Improvement Fund grants to Ecclesia College and AmeriWorks, according to the indictment and plea agreement. Woods, Paris and Shelton have pleaded not guilty. Shelton passed the kickbacks for Ecclesia to the lawmakers through consulting fees paid by the college, according to the indictment.

Woods faces 15 counts of fraud, all relating to either wire or mail transfers of money. Paris and Shelton are named in 14 of the fraud charges.

All three are charged with one count of conspiracy to commit fraud. Woods is also charged with one count of money laundering in connection with the purchase of a cashier's check.

Legislators controlled the distribution of General Improvement Fund grants until recently. The fund consists of state tax money left unallocated at the end of each fiscal year and interest earned on state deposits. Each legislator was given a share of the money to be directed to a nonprofit group or government entity. The state Supreme Court declared this method of distribution unconstitutional in a ruling Oct. 5.

The three defendants face up to 20 years in prison on the fraud and conspiracy charges, if convicted. Woods faces an additional 10 years on the money laundering charge, if convicted. All three may also be ordered to forfeit any money or property obtained through their actions, if found guilty.

NW News on 12/07/2017