Split verdict for businessman key to toppling Utah lawmen

AP News
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Posted: Mar 25, 2016 4:40 PM
Split verdict for businessman key to toppling Utah lawmen

SALT LAKE CITY (AP) — A Utah businessman who was a helicopter-flying philanthropist before he became a key figure in an influence-peddling scandal that ensnared two former state attorneys general was convicted Friday of lying to banks but cleared of dozens of other charges.

The Salt Lake City jury exonerated Jeremy Johnson, 40, of charges including fraud, conspiracy and money laundering. He was convicted on eight out of 86 counts and faces up to 30 years in prison at sentencing set for June, though his lawyers say they could push for probation.

Johnson was arrested five years ago with thousands in cash and a plane ticket to Central America. He later claimed the state's top lawman arranged to pay U.S. Sen. Harry Reid to toss the investigation into his Internet business after the attorney general and his predecessor took gifts such as luxury vacations from Johnson and others, prosecutors say.

Reid denies any part of the deal and has never been charged. Both former attorneys general have pleaded not guilty to charges including bribery and accepting improper gifts.

Prosecutors said Johnson and his top managers lied to banks to create shell companies because they were in danger of going out of business after being blacklisted by credit card companies.

Johnson, who acted as his own lawyer, said everyone involved knew what he and his colleagues were doing as they tried to deal with a growing number of people asking for credit-card refunds.

"Jeremy Johnson is a convicted con man," John Huber, U.S. attorney for Utah, said after the verdict. "White-collar criminals circle themselves in the mythology of their own devising. Jeremy Johnson is a classic white-collar criminal."

Johnson saw it differently.

"I do feel vindicated," he said. "Whatever the government is saying, I don't believe this was a win for them."

The trial began after a five-year buildup that included mountains of evidence, allegations of prosecutorial misconduct and a rejected plea deal. Johnson pushed to represent himself three times, saying the government was listening to conversations with his lawyers.

Before the charges were filed, Johnson was a millionaire who donated generously to charities including a home for boys who fled a polygamous group and used his personal helicopters to aid search-and-rescue efforts in southern Utah. He made international headlines in January 2010 when he bought a plane to fly doctors and other critical supplies to Haiti after a devastating earthquake.

Johnson was arrested at a Phoenix airport in 2011, carrying more than $26,000 in cash and a one-way plane ticket to Costa Rica.

Two years later, Johnson dropped a bombshell about the state's top lawman, alleging that then-Attorney General John Swallow had arranged a deal to pay Sen. Reid of Nevada to get rid of the investigation into Johnson.

The accusation helped touch off a scandal that culminated in the arrest of Swallow and his predecessor, Mark Shurtleff. Prosecutors say they both accepted illicit gifts from Johnson, such as vacations on his luxury houseboat and trips on his private jet, as part of a wide-ranging scheme in which they traded favors and gifts with businessmen in trouble with regulators during their combined 13 years in office.

Swallow is facing more than a dozen charges, including receiving a bribe and misuse of public money. Shurtleff is facing seven counts, including accepting improper gifts and obstructing justice. Both deny wrongdoing.

Those allegations were not a part of Johnson's fraud trial.

Johnson also faces a separate lawsuit in Las Vegas over his company's practices and a Federal Elections Commission lawsuit over his political donations.

His bookkeeper, Scott Leavitt, was cleared Friday of all 86 counts he faced. His lawyer called the charges politically motivated.

"The government destroyed him without any basis at all," attorney Marcus Mumford said.

Johnson's top manager, Ryan Riddle, was convicted of six charges but cleared of some 50 more. He said he was satisfied with the verdict and glad to be cleared of the more serious charges.