Former Buncombe County Sheriff Bobby Medford was arrested Thursday morning along with three of his officers and charged, under a federal indictment, with extorting money from illegal video poker operations.
Medford, along with reserve Capt. Guy Penland, former Lt. Ronnie Eugene “Butch” Davis and former Lt. John Harrison is charged with conspiracy to commit extortion, conspiracy to commit money laundering, five counts of mail fraud and obstruction of state and local law enforcement charges, including making false statements. If convicted, the men could face severe penalties, according to a release from the U.S. Attorney’s Office. The extortion, mail fraud and money-laundering charges each carry a maximum penalty of 20 years in prison and $250,000 in fines. The obstruction of justice charges carry a maximum of five years prison and a $250,000 fine.
The indictment, unsealed today, alleges that Medford and the other officers abused their official powers from October 2000 to December 2006 and “provided business owners and/or video poker operators with benefits and services ranging from non-enforcement of video poker laws, to the falsification of community service records on behalf of a video poker operator’s agent charged with criminal offenses.” The indictment also alleges that Medford and the officers gave video-poker operators access to grand-jury surveillance, provided transportation and placement of the machines, gave some of the operators deputy’s badges, ran a check on an FBI agent’s license-plate number, and that Davis called to warn operators about impending search warrants.
The mail fraud charges stem from Medford and the officers allegedly providing registration stickers for the illegal machines.
The conspiracy, according to the indictment, made money for Medford through golf tournaments, direct demands for cash and receiving money in exchange for convincing store owners to put the machines in their businesses. The indictment also alleges the extortion, among other things, helped support Medford’s gambling at Harrah’s Casino, with net losses of $54,142 in 2006 alone, on trips often accompanied by deputies in county vehicles, on work time.
The indictments follow on the heels of an ongoing investigation into Medford’s video poker ties. When Medford, Sheriff since 1994, left office after losing the 2006 election to current Sheriff Van Duncan, a county audit of his evidence rooms found missing drugs, guns and money. A 2005 Xpress story reported on unrecorded video poker machines, poor record-keeping on those machines by the Sheriff, as well as alleged cash payouts, and the likelihood of uncollected taxes in the video poker industry in Buncombe County.
(A summary of past controversies during Medford’s tenure can be found here.)
Davis’ apartment was raided in February, with agents seizing $18,000 in federal proceeds. The U.S. Attorney’s Office this summer indicted 21 people involved with Henderson Amusement Co., based in Inman, S.C. The investigations found that the Henderson operation had two deputies tied to Medford on its payroll and was bribing two sheriffs for protection. The company’s owners, James and Barron Henderson, had their charges lessened after a plea deal was reached. Charges against the two deputies were later dropped.
The investigation has involved multiples agencies, including the FBI, the State Bureau of Investigation and the IRS, with help from the Buncombe, Cleveland and Rutherford county Sheriff’s offices and the Police Department of Shelby, the indictment notes.
Ironically enough, Medford signed a letter in 2002 as part of the North Carolina Sheriffs’ Association in support of the bill banning cash payouts from video poker machines.
In a separate but related indictment, Weaverville businessman Jack Shepherd was also charged with operating illegal video poker machines.
—David Forbes, staff writer