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NewsChannel 5 Investigates: Capitol Hill Corruption

Senate Chairman Faces Expanding Investigation

(Story created 12/7/04)

A powerful state senator finds himself at the center of a growing criminal investigation. It stems from a NewsChannel 5 investigation of whether Sen. Jerry Cooper may have profited at taxpayer expense.

Now, federal agents appear to be expanding their investigation into new areas involving the Warren County Democrat.

"It looks like that you were helping yourself," NewsChannel 5's chief investigative reporter Phil Williams suggested to Cooper more than a year ago.

"I'm sorry, Phil, you are totally wrong," Cooper replied.

Among the questions: how he took a piece of land in Warren County that he couldn't sell, got the state to approve a railroad connection to the property, then sold it for $1.3 million.

"That piece of property was going to bring 40-50 jobs to my home county. Yes, I did -- could make money off that property if that rail spur came in -- without question," Cooper said.

"And you used your position?" Williams asked.

"But, Phil, I'd do that for everybody else."

Government watchdogs were appalled.

"It's an outrageous act by a sitting legislator -- one of the worst I've ever seen, in fact," said Charles Lewis of the national Center for Public Integrity.

Now, the Senate Commerce Committee chairman faces increased scrutiny from a federal grand jury investigation being run out of Chattanooga.

In September, prosecutors subpoenaed state economic development employee Philip Trauernicht. Sources say the questions focused on Cooper's land deal.

And just last week, IRS agents obtained Cooper's campaign financial disclosure reports from the state Registry of Election Finance, staff members there say.

Sources say investigators are interested in how Cooper spent money given by supporters to finance his re-election efforts.

All of this comes against the backdrop of Cooper's continuing financial problems.

Four years ago, a Warren County judge approved a garnishment of the lawmaker's wages -- after he defaulted on two bank loans. 
Today, Cooper owes the bank almost $ 1 million.

Last year, the man who bought Cooper's land, Tony Auyer, was indicted for wire fraud for allegedly submitting bogus invoices to the state.

Auyer got a federally guaranteed loan to buy the property only after state economic officials approved almost $300,000 to build the rail connection.

Documents show the money was approved at the Cooper's request.

"The rail spur was a critical part of your plan?" Williams asked Auyer.

"Yeah, it was critical," he replied. "We needed it."

Then, just before Auyer was scheduled to go to trial in April, prosecutors withdrew the indictment and, as watchdogs predicted, agents began expanding the investigation to include Cooper's role.

"This is very, very serious -- and in many states, there would be a prosecution that would emanate from these facts," Charles Lewis added.

Still, prosecutors won't talk about the case. Cooper didn't return our phone call either.

Cooper was chairman of the legislature's Fiscal Review Committee -- the committee that watches over the money.

Last month, he resigned his chairmanship. It's not clear what prompted   It isn't clear what prompted that decision.

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