A former S.C. State University trustee is facing dozens of new charges in a federal corruption investigation that claims he used his position and political connections to enrich himself and six other people who were part of his operation.
An indictment unsealed Thursday shows prosecutors are pursuing 52 charges against the college’s former Board of Trustees chairman Jonathan Pinson. The charges include racketeering, wire fraud, money laundering and making false statements to investigators.
Pinson, a Greenville businessman, was indicted earlier this year on one count of interference with commerce. He was accused of demanding and taking kickbacks for allegedly trying to get the university to buy land from a Florida developer in exchange for a Porsche SUV.
The new charges unsealed Thursday come a day after a second former university board member Lancelot Wright pleaded guilty to bank fraud and conspiracy. The indictment against Pinson connects the former chairman with Wright and other business partners who previously pleaded guilty to their role in the alleged scheme, although they are not specifically identified in the new court documents.
But Pinson’s attorney said the ex-chairman is innocent and a victim to the corrupt activities of his former partners. Columbia attorney Jim Griffin claimed fellow defendants lied to federal investigators in order to receive lighter sentences.
“It’s the age-old situation where someone who gets in trouble tries to accuse others of wrongdoing,” Griffin told South Carolina Radio Network. “In this case, the charges are not accurate. The charges are not true.”
The indictment claims Pinson used his political connections to secure a seat on the S.C. State board, then proceeded to use his position to solicit kickbacks.
Prosecutors previously had said that Pinson helped his colleague Eric Robinson’s firm WE Entertainment land a contract to host the 2011 Homecoming Concert at the school in exchange for a $1,000 kickback. Previous court records also claim Pinson actively sought kickbacks from Florida developer Richard Zahn, in exchange for promising that the board of trustees would support buying a parcel of land Zahn owned in Orangeburg County known as the “Sportsman’s Retreat.” The school’s former police chief Michael Bartley was also implicated for his role in the scheme. The indictment revealed investigators built their case using a wiretap on Pinson’s phone.
The new allegations also link Pinson to Wright, Irmo hospice owner Robert Williams, and former Columbia banker Phillip Mims. Prosecutors say the business partner trio has admitted roles in separate schemes that involved misusing grant money for a Marion County diaper plant and a proposed Columbia public-private housing development.
Bartley, Mims, Williams, Wright, and Zahn have all pleaded guilty to their roles in the operation. Robinson and Pinson are fighting the charges.
“Deception, influence, peddling, and greed were the hallmarks of this enterprise, and … members of the enterprise cloaked their illegal activities with a false veneer of respectability,” the indictment stated.
In 2009, Pinson was part of a group of investors that included Mims, Wright, and Williams which purchased the struggling Softee Supreme diaper plant and moved its operations from Atlanta to Marion County, S.C. The group created Supremes LLC to handle the new plant’s operations. They also worked with Marion County to secure a $1 million grant from the S.C. Department of Commerce — ostensibly to rehabilitate an existing building that would house the new factory. However, prosecutors say Mims, Williams, and Wright illegally converted $25,000 of the grant for their own use. The indictment states that the trio used a consulting firm owned by Pinson to submit false invoices and fraudulently collect $25,000.
The indictment also gives more information about Pinson’s connections with a troubled public-private housing development known as the “Village at River’s Edge.” The development in North Columbia was originally launched by a group that included Pinson and future Columbia mayor Steve Benjamin (Benjamin said he sold his share in the project to Pinson shortly before announcing his run for mayor in 2009). Mims, Wright and Williams also invested in the development, according to court records.
Pinson’s firm VRE LLC entered into a $5.6 million contract with the Columbia Housing Authority in 2007 to build 60 townhouses on the property. Wright and Williams admitted giving a $5,000 kickback to an unidentified Columbia municipal employee in August 2009 for the employee’s help in securing the contract. Prosecutors accuse Pinson of improperly “skimming” nearly $60,000 of that money for his own use. The indictment noted the payments went from VRE to Pinson’s personal bank account, which he had not pre-cleared through invoices submitted to the city.
The indictment notes federal investigators began tapping Pinson’s cell phone in summer 2011, obtaining Wright’s cooperation in the process. It states that Wright recorded a conversation between himself and Pinson around that time, in which Pinson came up with a cover story to explain the $5,000 kickback to the city employee. Investigators say a later wiretap recorded Pinson discussing with Mims on their ability to use housing funds for personal purchases because it was difficult to “track that sh–.”
In all, the indictment claims Pinson illegally shifted over $58,000 from VRE, LLC, into his own personal account. Griffin disputes the characterization, however.
“There’s a lot of money that moves through accounts when you’re spending $5.6 million,” he said. “So, they may have bank records, but the bank records don’t prove anything illegal.”
There are still some unanswered questions in the investigation. The Columbia employee who allegedly accepted the kickback has not been identified by investigators. Investigators also have not revealed the identity of a second SC State employee who allegedly knew about the Sportsman’s Retreat deal, and a Columbia real estate agent the indictment states was involved in discussions about a possible bribe of a second city official.