Local News

Geddings' Hidden Lottery Work Will Have Wide Impact

Posted October 15, 2006

— About the only thing Kevin Geddings accomplished during his 40-day tenure on the lottery commission was helping to officially name the state's gambling venture the "North Carolina Education Lottery."

Prosecutors in his corruption trial alleged he had greater plans in mind, and a jury apparently believed them, convicting Geddings last week on five counts of mail fraud for not disclosing $250,000 he'd been paid by a lottery company between 2000 and 2005.

And like the now ubiquitous lottery signs emblazoned with the name Geddings helped craft, his concealed work for lottery company Scientific Games Corp. could have far-reaching implications in North Carolina politics and courtrooms.

The "trial opened more doors than it closed and we can expect to see a number of the witnesses returning to federal and state courthouses in the months to come," said Bob Hall with the campaign finance reform group Democracy North Carolina.

Evidence presented during Geddings' trial and the testimony of House Speaker Jim Black raised questions about how much the speaker knew about Geddings' past work with Scientific Games and whether his connection to Meredith Norris -- his former political director who worked simultaneously last year for Scientific Games -- influenced his decisions.

It's the latest legal trouble for Black.

State and federal investigators have examined donations to Black's campaign by optometrists and the video poker industry, leading to charges this month against M. Scott Edwards, a friend of Black and head of the state's optometric political action committee. And ex-Rep. Michael Decker pleaded guilty in August to a federal conspiracy count that he solicited and received $50,000 to switch to the Democratic Party in 2003.

Decker's support of Black helped the Mecklenburg County Democrat remain co-speaker that year. Decker has agreed to cooperate with prosecutors in their investigation.

"You have a tangled web, with one common thread and it all runs back to Black," said Dan Boyce, a former federal prosecutor now in private practice in Raleigh. "But only the U.S. Attorney's office knows who might be prosecuted next."

Black has denied doing anything illegal, and his attorney has said repeatedly that his client is not a target of the federal investigation. The legal troubles have already created a difficult re-election campaign for him and could hurt other vulnerable Democratic House members.

"I have cooperated in every way," Black told reporters last week in Charlotte. "I testified in Mr. Geddings' trial the other day and answered every question truthfully."

Geddings testified he told Black on the night before his appointment was announced about his past business ties to then-Scientific Games executive Alan Middleton, but Black testified that call never happened. Black dined with Middleton and Norris that same night, but prosecutors cast doubt on his recollection that he didn't remember any discussion about Geddings.

The government said Black decided on Geddings at that dinner, and with the jury out of the courtroom, Assistant U.S. Attorney John Bruce argued that the relationship between Norris and Black "impacted governmental decisions." Black's lawyer said that never happened.

Norris and Middleton didn't testify and haven't been charged with federal crimes, but prosecutors alleged the three "were in a 'concert of action' to advance the cause of Scientific Games with respect to the North Carolina Lottery."

Attorneys for Norris and Middleton didn't return phone calls late last week.

U.S. Attorney George Holding declined to talk after the trial about where the government's investigation was headed except that it was continuing. "Sure, if there are more corrupt public officials, there will be more indictments," Holding added.

A grand jury indicted Geddings in May but the case came to trial just four months later -- a small gap considering that hundreds of exhibits from nearly a decade of Geddings' life were presented.

Boyce said the conviction certainly builds momentum for government prosecutors.

"Had they lost it would have taken the wind of out their sails, but it would not have killed the grand jury investigation because it is a multilayered investigation," said Boyce, a 2000 Republican candidate for attorney general. "It certainly emboldens the prosecutors to move forward with all deliberate speed."

Still, the case may have a long way to go before it's complete.

Bruce and Assistant U.S. Attorney Dennis Duffy, the government's lead lawyers in the Geddings trial, took 27 months to complete the corruption case of another Democrat, Meg Scott Phipps. The former agriculture commissioner pleaded guilty to extortion, conspiracy and mail fraud only after three close associates cooperated with the government.

Geddings' conviction and possible stiff punishment will be closely watched by those who may still have to fear prosecution, Boyce said.

"The defense attorneys who have potential targets or subjects of the investigation will be rethinking their strategy," he said.


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