Money connected to Reid

WASHINGTON -- The money that led to the indictment this week of two Las Vegas pastors and the wife of one of them came from federal grants arranged by Sen. Harry Reid in September 2001, a Reid spokeswoman said Wednesday.

Moving to distance Reid from a possible scandal, aide Tessa Hafen said the senator sought the money on behalf of a nonprofit social services agency and not for the churches or persons who have been accused of mishandling the money.

"The money was administered by the Department of Justice, and it went to the agency in Nevada (Alliance Collegiums Association of Nevada)," Hafen said.

The Rev. Willie Davis, the longtime pastor of Second Baptist Church, and his wife, Emma, were indicted Tuesday on fraud charges with an associate minister, the Rev. McTheron Jones.

They are accused of spending $330,000 from federal grants on themselves although the money was intended for halfway houses for prison inmates in Southern Nevada.

The indictment identifies Willie Davis as president of the Alliance Collegiums Association of Nevada board of directors.

In late 2002, Emma Davis became executive director, and Jones was assistant director.

According to the indictment, a grant of $423,000 was approved for the alliance in September 2002.

The indictment charges the defendants of using the grant money to benefit themselves.

A Reid relationship with the Second Baptist Church surfaced in 1997, when the senator donated $250 to the church where Davis was and still is pastor.

The money came from John Huang, who was convicted of making illegal contributions to the 1996 re-election campaign of President Clinton.

At about the same time, Reid donated another $250 from Huang to the First African Methodist Episcopal Church in Las Vegas.

Reid said he made the contributions to the churches instead of returning the money to Huang because he did not think Huang deserved it.

Reid has attended services at the Second Baptist Church "about three or four times" since 1997, Hafen said.

"He says hello to the pastor (Davis) when he goes to the church, but apart from that, the only other time he has seen him was in May when he met with about 30 or 40 ministers to organize a faith-based summit," Hafen said.

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According to the indictment, the defendants obtained a Justice Department grant in 2002, through a nonprofit organization called Alliance Collegiums Association of Nevada, to operate halfway houses for prison inmates in Southern Nevada.

"No halfway house was ever opened to receive inmates under the ACAN grant," the indictment alleges.

The document identifies Willie Davis as president of the alliance's board of directors. In late 2002, according to the indictment, Emma Davis became executive director and Jones became assistant director.

"At the time, Willie and Emma Davis were experiencing financial difficulties," the indictment alleges. "Willie and Emma Davis filed for personal bankruptcy on or about December 3, 2002."

According to the indictment, a one-year grant in the amount of $423,000 was approved for the alliance in September 2002 and funding began in December 2002. In June 2003, following allegations of misconduct, the Justice Department's office of justice programs froze the grant funds.

"By that time, ACAN had withdrawn and eventually expended approximately $330,000 in federal grant funds," the indictment alleges.

The document accuses the defendants of using the alliance grant to obtain financial benefits for themselves and others "that were not under the terms of the grant."

For instance, according to the indictment:

• Emma Davis, Jones and others received pay for work that was not done.

• Jones was paid for writing the grant application.

• Willie Davis was paid a consultant fee.

• Emma Davis and Jones were given raises not allowed under the terms of the grant.

The indictment also claims the defendants used false documents, "including false time sheets and fictitious ACAN board minutes," to disguise the nature of their fraudulent scheme. In addition, according to the indictment, they made false and misleading statements when interviewed by Justice Department investigators.

All three defendants face charges of conspiracy, wire fraud, mail fraud, theft of government property, making false statements to a government agency and obstruction of justice. Emma Davis also faces charges of bank fraud, bankruptcy fraud and misuse of a Social Security number.

According to the indictment, Willie Davis submitted an application for incorporation in October 2001 on behalf of the alliance with the Nevada secretary of state's office. The application included names and signatures of members of the alliance's board of directors, according to the indictment, but "two of the persons named on the list were not members of the board and had not signed the document."

The false list of board members later was submitted by the defendants to the Justice Department in response to an inspector general subpoena, the indictment alleges.

In September 2002, the Review-Journal reported that North Las Vegas Municipal Judge Warren VanLandschoot had filed a police report indicating the signature next to his name on a list of alliance board members submitted to the Justice Department was not his.

At the time, a spokeswoman for VanLandschoot said, "Several months ago, the judge met with members of the alliance and told them he cannot be on the board because it would be unethical as he is holding his current position."

The Review-Journal reported that the name of Tony Gladney, vice president of corporate diversity for the MGM Mirage, also appeared on the list. But a spokeswoman from his office said at the time that Gladney also had declined to participate on the board and should not have been included on the list.

Jones told the Review-Journal in 2002 that he had no idea how VanLandschoot's signature landed on the list. He also said a squiggle appearing next to Gladney's name was his attempt to indicate that Gladney was not on the board.

According to a statement released Tuesday by the U.S. attorney's office in Las Vegas, Jones was formerly employed by the Community College of Southern Nevada. It is unclear where he works now.

Jones often claimed in communications with Justice Department personnel and others that he had received a doctorate, according to the indictment, and he referred to himself as "Dr. Jones." Jones did not have a doctorate, according to the indictment.

The document further alleges that Willie Davis named his wife executive director of the alliance, "despite the obvious conflict of interest" and in violation of Justice Department grant policies, "which Willie Davis well knew."

"On or about early 2003, and after problems at ACAN had generated media coverage, Willie Davis told a meeting of the entire ACAN staff, in a threatening manner, that they were not to discuss ACAN business with outsiders, including the press," according to the indictment. "Emma Davis later instructed employees not to talk about ACAN to others, or even among themselves."

The indictment claims the defendants gave the Justice Department false minutes of an alliance board meeting dated Nov. 29, 2002, reflecting that the board or a subcommittee of the board had approved the hiring of Emma Davis, Jones and another person.

"In truth and in fact, the meeting never took place," according to the indictment.

The indictment also claims Emma Davis responded to a Justice Department subpoena around July 2003 by submitting a job application representing that she had no prior criminal convictions "when in fact she had previously been convicted of a federal felony offense." The indictment did not identify the offense.

According to the bank fraud charge in the indictment, Emma Davis used a false Social Security number and false tax returns to obtain a $90,000 loan from Community Bank of Nevada.

John Esperian, an English professor and former director of prison education at the Community College of Southern Nevada, said the alliance purchased three properties for halfway houses in North Las Vegas and had hired staff. They never opened because the federal government pulled the grant, he said.

He was a founding member of the alliance and toured the sites, one of which is directly across from Second Baptist Church, with Jones in his black Cadillac about a year and a half ago.

Esperian testified before the federal grand jury, but he said he had no first-hand knowledge of any illegal activity within the organization.

"Things went missing and people started accusing others of stealing money, and that's when I began wondering what the hell was going on," he said. "Did I follow it up and check it and look at records? No. But then again, I wasn't financially responsible."

After the grant was pulled, board members left the organization and the alliance dissolved. But Esperian said he technically is still a member.

Assemblyman Morse Arberry, D-Las Vegas, sat on the alliance's board but resigned in March 2003 after attending only one meeting.

"I just had too much on my plate," the assemblyman said Tuesday.

Arberry said Willie Davis has been his pastor for 25 years, and Tuesday's indictment did not change his opinion of the man.

"To me, him and his wife have always been upstanding," Arberry said.

He said Second Baptist Church, at 500 W. Madison Ave., has a congregation of between 2,000 and 3,000.

"It's one of the oldest churches in the community," Arberry said.

Other members of the church also offered support Tuesday for Willie Davis.

"I stand behind him 100 percent," said Juanita Walker, a church member since 1955. "That's my pastor and his wife, and I love them. ... We all make mistakes."

Allen Howard said he believes Willie Davis "has great integrity."

"I'd be shocked if there was any guilt," Howard said.

Leon Corbin said church members will "stand up and rally around" their pastor.

"We're going to say he's innocent until proven guilty," Corbin said. "You have to give the man a chance. Don't try him in the newspaper, because at this point it's just slinging mud."

A judge issued summonses Tuesday for all three defendants, who are scheduled to appear Oct. 7 before U.S. Magistrate Judge Peggy Leen.

http://tinyurl.com/b27yp

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Rev. Willie Davis, pastor at Second Baptist Church -- which is known as the "mother church of Las Vegas," according to its Web site

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Cecil Davis, who is no relation to the minister and his wife, was hired along with Victoria Coleman to work at the program the grant was to support. When the two didn't get paid, they approached the Justice Department, Cecil Davis said this morning.

"That was the beginning of the end of this corrupt regime," he said.

He said this morning that was supposed to be paid about $11,000, which he never received.

When the Sun reported in September 2002 on the flap over the lack of payment Willie Davis said the two were disgruntled former employees.

But federal investigators launched an investigation and froze the group's funds in June 2003.

The indictment alleges that Jones and the Davises, who filed for personal bankruptcy in 2002, drew pay for work they did not do and paid themselves fees and raises the grant did not allow.

snip

In 1999, Davis, acting as president of a group called the Ministers Alliance, wrote to Richard Moore, then-president of the Community College of Southern Nevada, recommending Moore hire Jones and six other members of the alliance. Moore hired Jones, who was later found to not have the credentials he claimed.

In 2003, Jones pleaded guilty to charges stemming from his claim that he held a doctoral degree that he didn't.

In December 2004, Jones finished paying the state back $18,000 in restitution for the gross misdemeanor charge of wrongful exercise of official power, in part with a check from the Ministers Alliance bank account, signed by Davis, according to Deputy Attorney General Jason Frierson.

The church Davis leads was founded in 1942, making it the oldest black Baptist church in the state, according to Associate Minister Chester Richardson.

The pastor's secretary, Mary Camp, said the church membership was around 800.

Richardson said the grant in question was one of the early results of President Bush's faith-based initiative, and that perhaps the defendants lacked guidance on how to administer the funds.

Davis' leadership is strong in the black community, according to Richardson.

"Rev. Davis is crucial and prominent in our community," he said.

Richardson predicted that the charges "will have trickle-down effects in the congregation and surrounding community -- anything from those who are weak-minded straying from the flock to those who will allege that this is persecution based on race."

Natalie Collins, spokeswoman for the U.S. Attorney's Office in Las Vegas, said "the race cards come up in some cases -- but we have to pursue cases based on facts."

"What about the false and fraudulent documents? We wouldn't have submitted it (the case) to a grand jury if we didn't believe there was intent," Collins said.

Dean Ishman, president of the local chapter of the NAACP, said he couldn't comment on the indictment.

"I don't know enough about it and assume he's innocent until proven guilty," Ishman said.

The Rev. Marion Bennett, who was pastor at Zion Methodist Church in West Las Vegas' predominantly black community for 44 years until recently, said such charges are "usually ... a target to get at black leaders throughout the country."

He said that he "couldn't see him (Davis) doing anything intentionally wrong ... and we should give him his day in court."

Bennett added that the federal indictment is likely to "wake up the black community to support those who want to make things better. I think it will bring us together."

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