Secret FBI Tape Reveals Reaction to Contracts Investigation - | Nashville News, Weather & Sports

NewsChannel 5 Investigates: Friends in High Places

Secret FBI Tape Reveals Reaction to Contracts Investigation

(Story created: 7/19/04)

Former Sundquist administration official Joanna Ediger could soon be heading to prison on federal corruption charges. But, in a once-secret FBI tape, Ediger insisted she wasn't taking the investigation seriously.

The secret FBI tape recording shows the former Sundquist administration official's reaction to first hints of a criminal investigation of insider state contracts. Prosecutors used the tape to help convince a jury to convict Ediger on mail and wire fraud charges.

"Have you met with the FBI, yet?" Ediger asks.

"Ah, naw, not yet," responds John Tucker, a colleague in Workforce Strategists. That was a Chattanooga company for whom Ediger had helped rig a $2 million state contract.

Tucker was placing the call at the request of FBI agents. Their interest: how the newly-formed company owned by friend-of-the-governor John Stamps got your money without having to compete for the job.

Ediger: "The FBI has not called me. They have not called John Stamps."
Tucker: "OK."
Ediger: "And I feel like if they were really doing a really, you know, in-depth investigation that they would have called."

Just two days earlier, federal and state agents had seized boxes of records from Workforce Strategists.

But Ediger assures Tucker that investigators were not going to find anything.

"There's nothing in the financial records unless Mark has written a lot of checks to Governor Sundquist which, you know, he hasn't done -- which, you know, we would be aware of I would think."

In fact, Ediger insists no money exchanged hands to land the no-bid contract -- though she doesn't preclude the possibility that other favors may have been granted later.

Ediger: "We can give anybody we want to money. It's whether that's what got us the contract or not."
Tucker: "Very true. Was it more or less a bribe type situation...."
Ediger: "Exactly."

What then-Governor Don Sundquist was not telling the public was that a federal grand jury had subpoenaed all of his e-mail.

But Ediger, who had left state government and gone to work for the company, somehow knew about the subpoena.

"They're having to look at all the governor's e-mails and things like that to see if, you know, John Stamps has e-mailed him or written him letters saying, you know, we really want this contract and you need to make it happen for us and stuff like that."

Still, when Tucker expresses apprehension about being questioned about the contract, Ediger stops short of telling him not to talk to agents.

Ediger: "It's not like they can force you to talk to them."
Tucker: "True, very true."
Ediger: "There's nothing legal that they can do to make you come and talk to them unless ... they're gonna subpoena you."

As for her own cupability, the former Labor Department official insists:

Ediger: "I'm not losing any sleep over it, if that's any help."
Tucker: "That makes..."
Ediger: "I am really not. I'm really not."

During her trial, Ediger's attorney argued those statements were proof of her innocence.

But prosecutors convinced jurors that the former state official had already got her story down.

Ediger: "I have done nothing wrong."
Tucker: "Cool."
Ediger: "I have done nothing wrong. And if anything illegal has happened in the company, I am not aware of it."

As a NewsChannel 5 investigation first discovered, Ediger had written a bogus memo claiming that Workforce Strategists was the only company in Tennessee that had experience for a state contract.

In fact, the company had no experience. It didn't even exist until it got your money.

Tucker: "They had Phil Williams on the Steve Gill show.... He was giving indications, you know, from the way that any kind of investigation may go, may go into the award phase.... So you think we're cool that way, too?"
Ediger: "Oh, yeah."

Instead, Ediger immediately blames her former boss, Sundquist Labor Commissioner Mike Magill -- an argument that would form part of her defense at trial.

Ediger: "Nothing was done illegal with the awarding of the contract, and if it was, it's not on us."
Tucker: "OK."
Ediger: "We didn't hold a gun to Mike Magill's head and say you have to award this contract."

But company owner John Stamps didn't need to hold a gun to Magill's head, prosecutors told jurors, because Stamps had Ediger on the inside.

Still, Ediger tells Tucker that Magill should get the blame.

Ediger: "If the state awarded them inappropriately, then that should be, they should be taking Mike Magill and trashing him as the commissioner of the Department of Labor."
Tucker: "Right."
Ediger: "Allowing things like this to happen, because, by God, the buck stops there."

In fact, Ediger's lawyer told jurors that the whole scheme was rigged by people with friends in high places.

Prosecutors have made it clear that Ediger could help herself out when it comes to sentencing if she becomes a witness for the government.

Asked if she is now cooperating, her attorney declined to comment.

As for Magill, he testified at Ediger's trial that, had he known what he knows today, he would have stopped the contract. But he claimed he just didn't have enough information to prompt him to do that.

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