Tennessee House Speaker, other lawmakers testify before federal grand jury

By: - March 29, 2022 7:00 am
"I'm encouraged and praying for our Justices," said Rep. Jason Zachary, R-Knoxville(Photo: John Partipilo)

“I’m encouraged and praying for our Justices,” said Rep. Jason Zachary, R-Knoxville, changed his vote on Gov. Bill Lee’s school voucher plan after cutting a deal to ensure his district was exempt. (Photo: John Partipilo)

House Speaker Cameron Sexton said Monday he gave “factual information” to a grand jury investigating political corruption and confirmed he is not a “target” in the federal probe.

Sexton was among at least five lawmakers subpoenaed to testify before the grand jury, including Republican Reps. Jason Zachary of Knoxville, Bud Hulsey of Kingsport, Patsy Hazlewood of Signal Mountain and Esther Helton of East Ridge. Legislative Administration Executive Director Connie Ridley also went before the grand jury Monday.

Zachary previously declined to confirm he was subpoenaed, saying only, “I know what you know.” He showed up, though, at the federal courthouse to provide testimony, according to reports.

Hazlewood also said last Thursday she had not been subpoenaed but later confirmed she received a subpoena by email she did not see until after speaking to reporters.

Sexton, a Crossville Republican in his third year as House Speaker, declined to give reporters details about his testimony but reiterated that he was called to give “factual information,” according to news reports.

Rep. Patsy Hazlewood, R-East Ridge. (Photo: John Partipilo)
Rep. Patsy Hazlewood, R-Signal Mountain. (Photo: John Partipilo)

“I think it’s important to remember I think grand juries, state and federal, are unique and different, and the federal process requires an individual to be subpoenaed to either (be) one of three people. One’s a target. I’m not a target, never received a target letter. Another one is a suspect, which I am not. And then third is a witness that provides factual information, a factual witness per se. Today, my role is to provide information and be a factual witness, which I happily did and answered all the questions under oath,” Sexton told news reporters outside the building in downtown Nashville.

Federal agents are putting together a case involving the creation of a political vendor that gave kickbacks to lawmakers and possibly political bribery surrounding the 2019 education savings account vote.

Sexton has said he has been cooperating with federal agents since he won election to the Speaker’s post in the fall of 2019 following the resignation of Rep. Glen Casada amid a sexist and racist texting scandal and complaints about his management style.

Sexton’s testimony comes on the heels of the resignation of Rep. Robin Smith when she pleaded guilty to a wire fraud charge three weeks ago. 

Smith and Casada, who was identified in federal documents as a former House Speaker from January 2019 to August 2019, used their positions in the Legislature to persuade House Republicans to do business with a new campaign vendor called Phoenix Solutions, according to federal documents. As part of her guilty plea, Smith is cooperating with federal agents. 

Smith, Casada and first-term Republican Rep. Todd Warner were targets in a January 2021 raid by FBI agents.

Smith’s guilty plea identifies the operator of the business as the former House Speaker’s ex-chief of staff, Cade Cothren, who resigned amid scandal. Cothren gave Smith and Casada kickbacks for more than $200,000 worth of business steered to him, according to the federal documents.

The House Republican Caucus spent tens of thousands of dollars with a man named Matthew Phoenix, believed to be Cothren, yet nobody within the caucus had a face-to-face meeting with the owner of Phoenix Solutions.

Hulsey said previously he believed he was subpoenaed because he did business with Casada’s consulting firm, Right Way Strategies. Helton said she believed she was called to testify because she used Phoenix Solutions, and Hazlewood used the vendor too, but then said later she would not have used it if she’d known who was involved.

I had concerns from early on, expressed my concerns. They searched down the concerns that I brought and there were fake answers given, lies, manipulations. But they were to the (satisfaction) of the caucus campaign finance committee.

– Rep. Jeremy Faison, R-Cosby, Chair, House Republican Caucus

Zachary said last week he had used Right Way Strategies, too, and told a Knoxville publication he didn’t think his subpoena had anything to do with flipping his vote in the 2019 voucher ordeal.

Republican Rep. Kent Calfee of Kingston has told The Tennessee Lookout two times he heard Casada discuss giving Democratic Rep. John Mark Windle a promotion in the National Guard in return for his vote. Calfee also said he heard Casada say he would call the governor and talk to him about making Windle a general.

Casada has said he didn’t have the authority to give anyone a promotion in the National Guard. 

Yet, Calfee said the governor called him to his office to talk about the matter and told him comments he’d made about Casada and an offer to Windle “reflected poorly on him.” The governor told Tennessee Lookout on two separate occasions he didn’t know anything about the meeting Calfee described.

Calfee has said he believes federal agents are conducting three investigations into the Legislature.

In fact, several lawmakers used Phoenix Solutions for campaign work and to handle their taxpayer-funded mailers.

Rep. Kent Calfee, R-Kingston: Reports overhearing former Speaker Glen Casada offer to talk to Gov. Bill Lee about a National Guard promotion in exchange for a vote. (Photo: John Partipilo)
Rep. Kent Calfee, R-Kingston: Reports overhearing former Speaker Glen Casada offer to talk to Gov. Bill Lee about a National Guard promotion in exchange for a vote. (Photo: John Partipilo)

House Republican Caucus Chairman Jeremy Faison said last week he suspected Phoenix Solutions was questionable almost from the time it surfaced as a player in the 2020 primary elections.

“I had concerns from early on, expressed my concerns. They searched down the concerns that I brought and there were fake answers given, lies, manipulations. But they were to the (satisfaction) of the caucus campaign finance committee,” said Faison, a Cosby Republican.

He later told the Chattanooga Times Free Press that when he challenged the validity of the vendor, Smith ran against him for the position of caucus chairman. He also called Phoenix Solutions “bull—-.” 

Phoenix Solutions used the same mode of operation as two other new entities in the 2020 election, Alabama-based Dixieland Strategies and the Faith Family Freedom Fund, as well as the same Hamilton County postal code, 383.

A former girlfriend of Cothren’s testified he persuaded her to organize the Faith Family Freedom Fund political action committee so he could run it. A North Carolina restaurant owner, who has not been found, donated the money that was used to attack former Republican Rep. Rick Tillis of Lewisburg in his race against Warner of Chapel Hill.

Warner defeated Tillis in the race, and a Tillis campaign worker filed a complaint that the Faith Family Freedom Fund PAC illegally coordinated with the Warner campaign.

The Tennessee Registry of Election Finance has turned that matter over to the Williamson County District Attorney’s Office and asked the Attorney General’s Office to bring in Cothren to testify. He refused to testify after being subpoenaed by the Registry board, invoking his Fifth Amendment right to avoid incriminating himself.

 

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Sam Stockard
Sam Stockard

Sam Stockard is a veteran Tennessee reporter and editor, having written for the Daily News Journal in Murfreesboro, where he served as lead editor when the paper won an award for being the state's best Sunday newspaper two years in a row. He has led the Capitol Hill bureau for The Daily Memphian. His awards include Best Single Editorial from the Tennessee Press Association.

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