has been in the business of providing mental and behavioral health services to young people in Northeast Arkansas for decades. Thousands of teenagers have either passed through his inpatient facility formerly known as the Lord's Ranch
(now renamed Trinity Behavioral Health) or received outpatient services via Arkansas Counseling Associates.
Now, Suhl stands accused of federal bribery, with the U.S. Department of Justice alleging he funneled thousands of dollars to a top official at the Arkansas Department of Human Services
in return for gaining preferential treatment for his companies. That helped keep millions of dollars in Medicaid reimbursements
flowing to Suhl's businesses, according to federal prosecutors.
Bribery requires at least two parties, and the "bribee" in this case, former Deputy Director Steven Jones
, has already pleaded guilty
. Jones, who is also a former state legislator, is serving a relatively lenient sentence in return for cooperating with the government; he will testify against Suhl — the alleged briber — in the days to come. Yet Ted Suhl (who has retained D.C.-based counsel known for high-profile corruption defense cases
) maintained his innocence as his jury trial began today in the court of U.S. Judge Billy Roy Wilson.
After a morning of jury selection and other preliminaries, attorney John Keller
laid out the government's argument against Suhl. "The defendant made a ton of money off the state of Arkansas," Keller said, in the form of Medicaid payments to his companies. But, he continued, this case isn't about the money he made; it's "about the money he spent ... to protect those profits."
Among other things, Suhl allegedly wanted Jones to modify DHS policy to expand the geographic radius of his business operations and to get him reappointed to the state's Child Welfare Review Board
. Suhl had been a member of the influential board under Gov. Mike Huckabee,
but he was not reappointed after Gov. Mike Beebe took over in 2007. Suhl wanted Jones to try to change that, according to the prosecutor. As one of two deputy directors, Jones had more influence over DHS than any official in the state aside from the agency's director or the governor himself, Keller said.
However, Suhl never paid Jones directly, and the prosecution's task is to convince the jury that there truly was a quid pro quo lurking in both men's interactions with a third party, Phillip Carter
, and his church, the 15th Street Church of God in Christ
in West Memphis.
Carter, a former West Memphis councilman and juvenile probation officer, had long known Ted Suhl and was a member of the 15th Street COGIC. Suhl wrote many checks to the church, ostensibly as charitable donations. Carter delivered cash to Steven Jones soon after some of those donations were made, prosecutors allege. The government said the scheme also required the complicity of the church's Pastor John Bennett,
who has since died. But at the heart of the alleged bribery is a conduit of cash leading from Suhl to Jones via Carter.
Speaking to the jury, Keller reduced the allegations to their simplest form: "Check to the church. Cash to Jones. All through Phillip Carter. 13 times from 2007 to 2011."
By 2011, the FBI had begun closing in on the alleged scheme, culminating in a wiretap of Carter and surveillance of a September meeting between the alleged co-conspirators at a Memphis restaurant called Texas de Brazil
where the three men met several times. At that meeting, video footage apparently shows Suhl slipping a check to Carter when Jones is away from the table, after which Carter apparently places the check in his sock. (Jurors were not shown the footage today.) The next month, the FBI confronted Carter, who began cooperating with agents.
"Only three people were at the table in the Texas de Brazil," Keller said. "Jones, the inside man. Carter, the middleman — the cash man. And that man." The prosecutor pointed over his shoulder towards the defense table
At first, the existence of the video footage would seem to seal the government's case against Suhl. But as defense attorney Alex Romain
told the jury in his opening argument, there's one problem: After cashing the check Suhl wrote to the 15th St. COGI in September 2011, Carter did not then give the cash to Steven Jones. It remained with him and Pastor John Bennett.
Carter eventually did deliver $1,000 to Jones — passed through the window of Jones' Lexus in the parking lot of a Cracker Barrel, attorneys said — but that was only after he began cooperating with the FBI. "The government says that $1,000 was a bribe from Ted Suhl. But the money didn't come from Ted Suhl ... it came from the FBI. Does that make any sense?" Romain asked the jury.
In its opening argument, the prosecution said Carter and Pastor Bennett sometimes kept Suhl's monetary gifts for themselves and the Sept. 2011 payment was one of those times. But the defense aims to cast doubt on whether the linkages between the three men add up to an unequivocal quid pro quo. Its primary strategy in doing so is to cast Phillip Carter, a key witness for the prosecution, in the worst possible light.
"Phillip Carter is the heart of the government's case against Ted Suhl ... [but] the evidence will show that Phillip Carter is a hustler," Romain said. For Carter, the defense attorney said, "everything is a hustle," from church to friends to career. "Phillip Carter played Ted Suhl and played Steven Jones." Meanwhile, Suhl's many checks to the 15th St. Church of God in Christ — over $15,000 in total — were genuine charitable donations, Romain argued. "Evidence will show Ted Suhl gave that money for a cause — not for favors."
The evidence will show, he said, no illegal relationship between Jones and Suhl. "Not one conversation about money. Not one dollar exchanged between them. Not one official act."
The big problem for the defense here is that — according to a statement
from the U.S. Attorney's office after Jones was sentenced earlier this year — Jones has admitted
to soliciting and accepting cash from Suhl and to performing official acts benefiting Suhl in return. This makes Jones' upcoming testimony the linchpin of the trial, which in turn makes one thing Romain told the jury today especially interesting: "The government says Steven Jones has pleaded guilty. But listen closely as Steven Jones testifies as to why
he pleaded guilty."
Jurors did get to hear partial testimony from one witness, late in the afternoon: FBI Special Agent Phillip Spainhour
, who was the lead case agent on the investigation into Carter. He's since moved from the Little Rock field office to North Carolina.
The investigation, Spainhour told U.S. prosecutor Amanda Vaughn, began when the FBI received a citizen complaint that Carter "was basically double-dipping." (He did not elaborate, but the government's trial brief alleges that before the bribery scheme in question evolved, Carter was involved in another shady deal with Suhl: As a juvenile probation officer, he referred youth to Suhl's behavioral health businesses in return for Suhl giving Carter's wife "a practically no-show job from 2007 through 2012." That evidence may be fleshed out later.) The investigation then expanded to include Jones, Suhl and Bennett. The FBI obtained a wiretap of Carter's phone in May 2011.
The courtroom was then treated to a few audio recordings of calls between Carter and Suhl, and between Carter and Jones. In the first, Suhl can be heard telling Carter that "he could put the stop to this," and later saying "even though he's a friend, we'll see if he's got the guts to do it." Carter tells him, "I'll get with him. ... I'll put a call to him. ... We'll definitely give our friend a call and raise that issue."
Both men seem careful not to identify who the "him" is by name. At one point, though Suhl says "we'll try to have lunch with your buddy who drives a Lexus ... and your other buddy." As for what Suhl wants to be stopped, it appears to be a DHS pilot program that steered business towards "Mid-South" — presumably, meaning Mid-South Health Systems
, a competitor with Suhl's businesses in east Arkansas. Suhl seems to suggest he's only trying to correct unfair treatment: "I'm not saying to give them all to us. ... it doesn't need to be about us. ... Mid-South is awful. They're the worst."
That call occurred on July 25, 2011. A few days later, in early August, Steven Jones spoke to Carter by phone. If anything, their conversation sounds even more circumspect than the one between Carter and Suhl, but Carter tells Jones he has some questions about "the referral process in Northeast Arkansas" and the fact that everyone is "obligated to give to Mid-South." Jones' answer is not muddled, but he can be heard to say, "I intended to call you a couple weeks ago. ... Some stuff came up regarding him, his organizations."
Later that day, Carter called Suhl back. "Listen, my friend called me this morning ... [he] didn't seem like he wanted to talk about it on the phone," Carter says.
At that point, the trial recessed for the day; it resumes tomorrow morning.