Former FBI agent Chuck Stuber opens up about corruption cases against NC politicians

acurliss@newsobserver.comJune 28, 2014 

  • Making political cases

    Former FBI agent Chuck Stuber was in the middle of a series of high-profile public corruption cases over the past decade in North Carolina. Here are the big ones Stuber helped lead:

    •  Video poker cases

    More than a dozen defendants were convicted as part of a five-year probe into illegal gambling businesses in Eastern North Carolina. Among them: Garland B. Garrett Jr., a former secretary of the state Department of Transportation and aide to former Democratic Gov. Jim Hunt. Garrett pleaded guilty in late 2002.

    •  Frank Ballance Jr.

    Ballance, a former Democratic U.S. congressman and state senator, was charged with fraud and money laundering in 2004 after a probe of the John A. Hyman Memorial Youth Foundation. Ballance’s son, state court judge Garey Ballance, was charged with failing to file a tax return. Ballance entered a guilty plea in November 2004. His son spent eight months in prison in 2006.

    •  House Speaker Jim Black

    Black had been dogged by several scandals for more than a year when he pleaded guilty in early 2007 to a charge of “corruptly accepting things of value.” Black admitted to taking more than $25,000 in cash and $4,000 in a check from chiropractors whose legislation he helped advance. Some of the cash hand-offs took place in or just outside restaurant bathrooms in Charlotte.

    •  Mike Easley and Ruffin Poole

    Former Gov. Mike Easley pleaded guilty in 2010 to a felony in state court as part of a plea that ended a long-running federal investigation into gifts and favors he accepted while governor. The federal arm of the probe had resulted in a guilty plea to tax evasion charges by one of Easley’s closest aides, Ruffin Poole.

    •  John Edwards

    Edwards was tabloid fodder by the time federal agents began probing his campaign in the middle of 2008. That probe led to charges on six counts of false statements, illegal campaign contributions and conspiracy. In 2012, a jury acquitted Edwards on one count and deadlocked on the other five.

    Source: N&O research, U.S. Attorney’s Office for Eastern District of North Carolina

When Chuck Stuber shows up, politicians are in trouble.

He’s the FBI agent who put handcuffs on former House Speaker Jim Black and former U.S. Rep. Frank Ballance Jr.

He’s the one who booked a top aide to former Gov. Mike Easley and then played a major role in Easley’s felony conviction.

He escorted former U.S. Sen. John Edwards’ mistress, Rielle Hunter, into a federal courthouse so she could testify to a grand jury.

Stuber, 54, worked a string of those and other political cases in North Carolina over the past decade that collectively helped influence the direction of state government. He retired last month after working 28 years with the FBI.

But he’s not quitting.

Last week, Stuber started work as an investigator at the state Board of Elections, where he will focus on rooting out fraud and campaign violations. He is expected to take up several pending inquiries – into questions of voter fraud, about possible campaign violations by state lawmakers, and an ongoing probe of a major campaign donor in the last statewide election cycle.

Stuber has appeared in photos and news footage around the world, yet he rarely spoke as a witness or to the public. In an interview with The News & Observer while between jobs, Stuber described some of the high-profile cases he worked on with agents from the IRS, the State Bureau of Investigation and other agencies.

He was guarded, often choosing words carefully or refusing to answer questions because of secrecy aspects of the past investigations. But he also provided insight into key moments in cases that commanded intense attention across North Carolina, cases that mostly targeted Democrats who were in power at the time.

Other details of his work emerged in recent interviews and at a retirement ceremony attended by multiple agents.

Frank Perry, secretary of the state Department of Public Safety for Gov. Pat McCrory, delivered to Stuber one of the highest awards a governor gives, the Order of the Long Leaf Pine. Perry said he had discussed the award with the governor.

“He wanted to know about you,” Perry told Stuber at the retirement gathering. “He knew immediately the cases you made, many of which, I guess, made it possible for him to be governor.”

Perry supervised Stuber as head of the FBI’s Raleigh office from 2000 to 2005. In an interview, Perry said Stuber was “the complete agent.”

“He would just follow the leads to where they went,” Perry said. “He wasn’t political.”

Stuber said in the interview that what he most enjoys of political investigations is the effort to bring submerged events to the surface.

“It’s pure and simple to try to find out what happened, to try to get to the truth of what happened,” Stuber said. “You do the best you can to establish the truth and then the judicial system takes it from there.”

Getting to Raleigh

It took a special transfer to get Stuber to Raleigh, his hometown.

John Werner was the FBI’s supervisor in Raleigh in the late 1990s when a scandal erupted here involving the state Department of Transportation. It included disclosures of a businessman giving campaign money for a DOT board seat, and it tainted then-Gov. Jim Hunt.

Werner, now retired, said in an interview that the FBI hadn’t focused much on political corruption cases in Raleigh and he wanted to “pump up” the office’s work.

“It’s extremely difficult work,” Werner said. “It takes a lot of effort to bring in a successful case and you really need to have a special agent, someone who’s not only bright but tenacious as hell. That’s what I would say about Chuck.”

Stuber did not have seniority to easily come to Raleigh. He had graduated from N.C. State with a degree in accounting and went to UNC-Chapel Hill for a law degree. He joined the FBI soon after, in 1985.

“That’s a unique combination – an accountant, a lawyer and an FBI agent,” said U.S. Rep. George Holding of Raleigh, a Republican who as U.S. attorney oversaw prosecutions of many of Stuber’s cases. “When it comes to rooting out political corruption crimes, it’s a deadly combination.”

Stuber had worked in Denver on a big securities fraud case and in Washington, D.C., on the House bank scandal, where members of Congress had overdrawn their accounts at the House bank without penalty. But he wanted to get back to Raleigh.

He got the transfer in 1998, registering to vote here as a Republican.

‘Double Black Diamond’

Stuber said he looked into the unfolding DOT scandal but he soon focused on something else: video poker.

The games were awarding thousands in illegal payouts. The industry had a cadre of machine owners who made significant political donations.

Stuber launched an undercover operation. It was called “Double Black Diamond,” a name selected from his days in Denver; it’s the label given to the most difficult ski runs.

The probe led to a series of convictions through 2004, including Hunt’s former secretary of transportation.

By then, Stuber also had developed leads about Ballance, a former state senator and then member of Congress.

As that case swirled, Stuber said the key moment was straightforward. He and Tim Reilly, an IRS agent, were examining bank records of a taxpayer-funded nonprofit foundation with ties to Ballance. They spotted a purchase at Capital Ford in Raleigh. Records showed that the money bought a Lincoln Navigator SUV for Ballance’s son.

“That’s when we knew we had something there,” he said.

Ballance eventually pleaded guilty to diverting more than $100,000 in taxpayer money from the foundation to him, his family and his church.

Cash for favors

With those cases over, Stuber was on to a major target – the powerful speaker of the state House, Jim Black.

“Probably the most significant thing, to me, to come out of the video poker cases is we saw that Jim Black was getting a ton of money from the video poker industry,” Stuber said. “Literally, hundreds of thousands of dollars. Every election cycle.”

He recalled that all 100 sheriffs were “petitioning” Black to ban the games, but Black wouldn’t.

“Jim Black’s basically their guy keeping it legal for them,” Stuber said, and there “seemed to be some connection between the money he was receiving from the industry and he’d never allow it to come up for a vote.”

News reports in The N&O were focusing on Black, his aides, his appointments, his ties to video poker and other special interests. Stuber and other agents were serving subpoenas.

One lawmaker, Michael Decker, would plead guilty to extorting $50,000 in connection to a scheme to keep Black in power. The money came from Black, who insisted that it was meant to support the campaign of Decker, who had switched parties to keep Black in charge.

As Decker pleaded guilty, in early August 2006, it wasn’t clear how the case would end up, Stuber said.

That changed later that month, Stuber said, when agents served subpoenas to chiropractors who had been close to Black, requiring them to appear before a grand jury. Stuber said he did not know what they might share.

The chiropractors held secrets, including that they had made cash payments of at least $25,000 to Black while he was advancing legislation favorable to them. Black converted it to his personal use. Stuber said that “tipped the scales.”

Stuber said there were “a lot of people” who were so afraid of Black’s power to retaliate that they “flat-out lied to us” or wouldn’t share information in the midst of the probe.

Black won re-election that fall, but the information from the chiropractors was solid. Black resigned a day before he pleaded guilty in February 2007 to a count of “corruptly accepting things of value” and agreed to cooperate with authorities.

After the plea, there was rampant speculation in Raleigh that Black, who had been speaker for a record-tying four terms, would provide information about other wrongdoing and lead to a wave of more convictions. But the discussions were not very productive, Stuber said.

“It was not a contentious sort of interview with him,” Stuber said. “We felt like he probably wasn’t telling us everything that he knew and maybe telling us a lot things he knew we already knew.”

Black couldn’t be reached. His lawyer, Ken Bell of the McGuireWoods law firm in Charlotte, disagreed.

“I have the highest respect for Chuck, but I strongly disagree with his characterization,” Bell said in an email.

Pursuing John Edwards

Stuber was on vacation in summer 2008 when one of the state’s former U.S. senators, John Edwards, was again in the national news.

Edwards, who had been dogged by tabloid reporters all year, admitted in a prime-time interview to an extramarital affair with Hunter. He also falsely denied fathering a child with her. The National Enquirer reported that Edwards’ mistress received “hush money” through people aligned with his campaign.

Stuber found Andrew Young, an aide to Edwards who Stuber said “provided a lot of information.” Young later wrote a tell-all book. He and Reilly, the IRS agent, went to New Jersey and found Hunter, who also shared details.

In 2012, Edwards was acquitted on one charge and the jury deadlocked on five others. Stuber said he isn’t sure whether the case would have turned out differently if Fred Baron, who helped orchestrate the payments to Edwards’ mistress, had been able to testify. Baron died in late 2008.

“We never got a chance to interview him,” Stuber said.

Edwards declined to comment.

‘Without agenda and attitude’

From 2009 to 2011, the Edwards and Easley investigations were going at the same time. The N&O was reporting extensively on Easley in that period, uncovering details of perks Easley had accepted as governor. Federal subpoenas produced documents from N.C. State University that showed Easley had helped create a job for his wife there.

Eventually, the investigation developed information that one of Easley’s top aides, Ruffin Poole, had accepted $55,000 and other favors from a financier of coastal developments while helping facilitate permits for the developments.

Poole pleaded guilty to a tax evasion charge and went to prison. He did not point authorities to wrongdoing by Easley, Stuber said.

“We all expected more out of Poole than what we got,” Stuber said.

The investigation culminated in a low-level felony conviction in state court for Easley for accepting a free flight. It was part of a plea deal that ended the federal investigation.

Stuber said he learned a lot about Easley through the investigation. What stands out, Stuber said, is that Easley was “about as far from a typical politician as anybody you’ll ever find.” Fundraising events would be set up, and he wouldn’t show.

He wouldn’t make phone calls for his campaigns, to the frustration of aides. But yet, he had accepted perks, Stuber said.

“It was interesting to me that Mike Easley pretty much took whatever was out there to be taken, whether it was plane flights or free use of a car or somebody would offer a fishing trip or whatever,” Stuber said. “I guess I would have maybe expected somebody in that position to use a little better judgment ... and just be concerned that this might not be appropriate.”

Easley’s lawyer in the case, Joseph Cheshire of Raleigh, also represented Ballance and said in an email he has had other cases with Stuber.

Cheshire said the political cases achieved nothing, were an “almost total waste of money” and helped put Republicans in charge, which he said is “undoing fifty years of progress” in North Carolina.

But he said he does not blame Stuber for how things unfolded – instead believing that appointed prosecutors should not have advanced them.

“In the political cases, Chuck always played the good cop, probably because it would be hard for him to even play a bad person,” Cheshire said. “He was a throwback FBI agent, which is a high compliment. Professional, nice, respectful, intelligent and dogged. Without agenda and attitude.”

Curliss: 919-829-4840; Twitter: @acurliss

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