Patrick Cannon to plead guilty Tuesday to corruption charge

mgordon@charlotteobserver.comJune 2, 2014 

MAYOR FORUM

Former Charlotte Mayor Patrick Cannon

ROBERT LAHSER — rlahser@charlotteobserver.com

Former Mayor Patrick Cannon, returning to the public spotlight for the first time since his stunning arrest, is expected to plead guilty Tuesday to a federal corruption charge.

New documents released Monday say Cannon will stand before U.S. Magistrate Judge David Cayer at 10:45 a.m. to offer his plea to a single count of honest services wire fraud. The charge is commonly used in cases where public officials take kickbacks or bribes.

Cannon and his lawyers signed a plea agreement with prosecutors on May 8, but the terms have remained secret until they were unsealed Monday morning.

The 48-year-old Democrat did not answer the door at his house Monday. His attorney, James Ferguson, said he could not comment when asked why his client had agreed to plead guilty rather than fight the charges.

Cannon, who is free on bond, will be sentenced at a later date. He faces a maximum of 20 years in prison and a $250,000 fine.

Many of the details of Cannon’s alleged acceptance of almost $50,000 in bribes during a three-year FBI sting became widely known at the time of his March 26 arrest.

But the new document also alleges a different case of bribery. This one involves Cannon and Charlotte strip club mogul David “Slim” Baucom. Prosecutors say money illegally changed hands as Cannon tried to lessen the impact of the city’s new light-rail line on one of Baucom’s clubs, Twin Peeks.

In January 2013, prosecutors say Cannon pocketed $2,000 from the club’s owner to influence zoning, planning and transportation departments to make it easier for the night spot to stay in business, despite being in the path of the light-rail construction zone.

Twin Peeks, adjoining the Blue Line extension on North Tryon Street near W.T. Harris Boulevard, was demolished in June 2013 but could be rebuilt on the remainder of the lot, according to Charlotte Area Transit System documents.

According to federal prosecutors, by the time the light-rail negotiations took place, Cannon had been taking bribes from Baucom for years.

From Cannon’s return to the City Council in December 2009 until his arrest as mayor, court documents say, “Cannon solicited, accepted and agreed to accept periodic cash payments and checks from or on behalf of (Businessman#1).”

In return, Cannon used his offices “to make contacts and exert official influence over city zoning, planning and transportation officials,” the document says.

While the court document does not include charges against any new targets, prosecutors say those are still possible.

“This investigation did not end with Patrick Cannon’s arrest,” U.S. Attorney Anne Tompkins told the Observer on Monday.

Baucom could not be reached for comment Monday. An Observer reporter who was outside of Baucom’s home in Cabarrus County on Monday morning was ordered off the property. An employee at Baucom’s MAL Entertainment on North Tryon Street said the businessman was not at his office. His reserved parking space was empty.

Baucom’s name also emerged in the case against former N.C. House Speaker Jim Black. In 2006 and 2007, he came under scrutiny for improperly reported campaign contributions to Black.

Contacted by the Observer after Cannon’s arrest, Baucom said he barely knew him and had not been questioned by the FBI.

Asked Monday afternoon if action is pending against Baucom in connection with the Cannon case, a spokeswoman for Tompkins said prosecutors cannot comment on an open investigation.

Tompkins and John Strong, special agent in charge of the FBI office in Charlotte, will hold a 1 p.m. press conference Tuesday at the U.S. Attorney’s Office.

A plea of cooperation

As part of his plea, Cannon has promised to assist the ongoing investigation. In return, the prosecution team led by Assistant U.S. Attorney Michael Savage says it will not use future evidence to push for a harsher sentence.

If Cannon fails to meet the standards of cooperation set out in the agreement, prosecutors can lobby the judge to hand down the full 20-year sentence.

Honest services fraud is one of the three corruption charges leveled against Cannon at his arrest. It basically means Cannon used his mayoral and City Council posts for illegal gain, depriving city residents of his “honest services” as their elected representative.

The other two charges involving theft, bribery and extortion are not included in the new filing. Under federal sentencing rules, they would have had little influence on Cannon’s punishment, legal experts say.

After Cannon’s arrest, federal prosecutors subpoenaed both city and Mecklenburg County governments, demanding mountains of records, raising questions about the honesty of local government. The FBI is believed to be checking into everything from the city’s airport taxi contracts, to zoning and liquor permits, as well as the county’s tourism and hospitality sector.

So far, Tompkins said, she’s been impressed by the “high level of professionalism” in city and county staffs.

Both government groups are cooperating with the investigation, she said, “so that the public can have confidence that our government and our elected officials are fulfilling their duty of honest and faithful service to the community.”

In a joint statement Monday afternoon, Charlotte City Manager Ron Carlee and Mayor Dan Clodfelter, who was appointed by the City Council to fill Cannon’s vacant seat, said the city continues to cooperate with investigators “to deal appropriately with any allegations of wrongdoing.”

They also expressed their hope that the new documents will “advance the resolution of the case at the earliest possible date.”

Greater breach of trust

Cannon’s fall has been breathtaking.

In 1993, the son of a single mother who grew up in public housing became the youngest candidate ever elected to the City Council. Last November, voters chose him to be mayor. Now the man whom the FBI says bragged openly about his government clout, including connections that reached as far and high as the White House, stands to become the city’s first mayor ever sent to prison.

The FBI says Cannon became a federal target in August 2010, less than a year after he returned to the City Council following a four-year absence. The FBI says that starting in January 2013, Cannon took five bribes totaling about $50,000 plus gifts over a 14-month period.

The most recent of the bribes came in February. In what was clearly the zenith of the federal case, the FBI says Cannon accepted $20,000 in the mayor’s office then solicited an undercover agent for more than $1 million in additional kickbacks.

He was arrested a month later. He stepped down as mayor the same day.

Sentencing latitude

Tuesday, he will be back in federal court for the first time since his arraignment.

For now, federal sentencing guidelines offer a starting point for penalties. But federal judges are given wide discretion to enlarge or reduce the terms. Legal experts say Cannon’s relative lack of a criminal background will be considered, but so will the fact that he violated the public trust, first as a City Council member, then as mayor.

“If you were a restaurant inspector it would be a different case,” said Sam Buell, a Duke University law professor and a former federal prosecutor. “But the fact that you were a mayor, the seriousness of the breach of trust will be higher with the more responsibility that you had.”

Though the size of Cannon’s eventual sentence depends on numerous variables, including the frequency of his corruption and the amount of money involved, recent cases targeting mayors of other U.S. cities offer a glimpse of the penalties he could face.

FBI stings in Trenton, N.J., and the Miami suburb of Sweetwater, Fla., led to prison sentences this year of five years and 3 1/2 years for those mayors, respectively. Both of those cases appear to have involved smaller amounts of money than Cannon is accused of taking.

Consolidating charges is a common part of plea agreements, said Randall Eliason, a George Washington University law professor, former federal prosecutor, and an expert in public corruption cases.

Prosecutors often reduce the charges in return for a guilty plea. But the remaining counts must “fairly reflect the seriousness of what they’ve done,” Eliason said.

They also must carry what prosecutors believe to be the appropriate penalty.

Keeping a low profile

The new filing does not mention Cannon’s wife, Trenna, who accompanied her husband last summer on a Las Vegas trip paid for by the undercover agents. Upon arriving, according to earlier documents, Cannon received $1,000 in spending money from an FBI agent posing as the Cannons’ host for the trip. Later, Trenna Cannon thanked the agent for the gift over the phone.

Since his arrest, Cannon has kept a low profile and has declined all interviews. He has surfaced occasionally with posts on Twitter and at baseball games involving his son.

His name has been removed as chief executive officer from the website of E-Z Parking, a company he helped start 26 years ago. His status with the company is not clear.

Gov. Pat McCrory, the city’s longest-serving mayor, said Monday that he was not familiar with the new allegations against Cannon but called them “shameful.”

McCrory, who first met Cannon when he was a teenager, said he has not talked to him since his arrest.

“What Charlotte needs to do is make sure they have systems in place where this kind of thing can never happen again,” the governor said during a Monday appearance in Monroe.

“It is a stain on our history.”

Jim Morrill, Ely Portillo, Elizabeth Leland, Joe Marusak and Maria David also contributed.

Gordon: 704-358-5095 Rothacker: 704-358-5170

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