Grand Jury Issues First Indictment in 'Friends in High Places' Probe - NewsChannel5.com | Nashville News, Weather & Sports

NewsChannel 5 Investigates: Friends in High Places

Grand Jury Issues First Indictment in 'Friends in High Places' Probe

(Story created: 3/11/04)

A federal grand jury has indicted a former Sundquist administration official on public corruption charges. It's the first indictment from our Friends in High Places investigation of insider contracts. Now, the question: could a close friend of former Gov. Don Sundquist be next?

The investigation first broke into public view 18 months ago when FBI and TBI agents raided Workforce Strategists.

The Chattanooga company had landed a no-bid contract to provide counseling for the unemployed. That contract would eventually be worth almost $2 million.

Now, Joanna L. Ediger -- the former Labor Department employee who helped push the contract -- faces a four-count federal indictment and up to 30 years in prison.

"Ms. Ediger basically has been charged with influence peddling," says former federal prosecutor Gary Blackburn.

The public-corruption indictment charges Ediger, 35, with:

  • Mail fraud,
  • Wire fraud, 
  • Bribery and
  • Making false statements to investigators.

As NewsChannel 5 first reported, the indictment notes that Ediger helped Workforce Strategists land the contract, then became a consultant and part owner of the company.

"It alleges that she worked for the state, that she secured business for that vendor and profited from it herself," Blackburn adds.

As NewsChannel 5 first revealed, Workforce Strategists was started by John Stamps, a friend and former business partner of former Governor Don Sundquist.

The Sundquist administration justified not allowing any other company to compete for the business, saying Workforce Strategists was the only company in Tennessee that had experience for the job.

That was just six days after Workforce Strategists was incorporated.

"One of the charges against Ms. Ediger is that she aided and abetted," the former federal prosecutor adds.

The indictment says Ediger was co-conspirators with Workforce Strategists' owner. That was Stamps, although he's identified only as "Individual A" in the indictment.

"This is an indictment of a person lower in the level of things. Often the government will indict people on a lower level to secure their cooperation against other witnesses."

As for what role the former governor may have played in helping Stamps land a state contract, investigators won't say. Sundquist denies any wrongdoing.

But they've now made clear: they'll go after whoever may have benefited from having friends in high places.

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