Ex-lawmaker at site as grand jury meets
BY SUSAN HYLTON World Staff Writer
Thursday, March 15, 2007
He says his visit to the courthouse had nothing to do with the session.
MUSKOGEE -- Former state Rep. Mike Mass of Hartshorne was at the federal courthouse in Muskogee the same day a grand jury was in session Wednesday, but he said he was not there to testify.
Mass, who is embroiled in an FBI investigation involving former longtime state Sen. Gene Stipe, visited the local office of the Oklahoma attorney general two days after he was subpoenaed to testify in a civil trial involving Stipe and Stipe's former business partner, Steve Phipps.
The investigation concerns an alleged straw donor scheme in which people who contributed to several Democratic campaigns -- including that of U.S. Rep Dan Boren -- were reimbursed by companies controlled by Stipe and Phipps. Boren has claimed no knowledge of the scheme.
FBI agents seized computers and documents from Stipe's McAlester office as well as that of his accountant, Greg Shores.
No one has been indicted in the investigation.
Grand jury proceedings are closed, and any indictments typically are not disclosed until the two-day session is complete. Grand juries normally meet monthly and serve for about a year.
"The law does not permit me to disclose, or comment concerning, grand jury proceedings," U.S. Attorney Sheldon Sperling said.
FBI agents further allege in an affidavit that Stipe and Phipps made agreements with former Reps. Mass, Jerry Hefner of Wagoner and Randall Erwin of Nashoba, all Democrats, to receive kickbacks in exchange for obtaining $2,273,581 in state funds for the nonprofit Rural Development Foundation created by Phipps.
Of that total, only about 2 percent went to community projects such as Crowder Senior Citizens, which received $495, and a 4-H club, which received $600.
The affidavit asserts that most of the money -- about $2.1 million -- went to National Pet Products and Indian Nations Entertainment, companies created by Phipps.
Stipe is believed to be a silent partner in National Pet Products.
Mass is listed as a consultant for Indian Nations Entertainment, which paid him more than $76,000 between March and December 2005, the affidavit states.
Stipe is serving a five-year probation he received after he pleaded guilty to illegally funneling $245,189 into the failed 1998 congressional campaign of his political protege Walt Roberts. Stipe also was sentenced to six months of home detention and fined $735,000.
A parole violation report against Stipe will be filed at some point, said Kelly Garrett, chief U.S. probation officer for the Eastern District of Oklahoma.
Susan Hylton 581-8381