Two principals of a failed ethanol production company each pleaded guilty in federal court on Monday to one count of conspiracy after a grand jury indicted them last year on charges also involving bribery, extortion, and perjury. They will return to court Aug. 31 for sentencing and could each receive up to five years in prison.
David Lee Brady, 75, of Raleigh was president of Agri-Ethanol Products and James Albert Perry, Jr., 62 of Wake Forest was an employee. Brady is a Raleigh businessman and real estate developer. Perry is a former mayor of Wake Forest.
Brady and Perry sat together with their attorneys while Assistant U S. Attorney Dennis Duffy explained the duo’s criminal activities to U.S. District Court Judge Terrence Boyle.
AEP planned to build an ethanol production plant in Beaufort County. The conspiracy charge, outlined in an indictment document released in October, stated that Brady, Perry, and others committed a crime against the United States when they agreed to obstruct, delay, and affect commerce through an extortion arrangement involving a public official.
Under that arrangement, Boyce A. Hudson, a former senior field officer in the Department of Natural Resources, tried to expedite environmental permits for AEP. In return, Hudson stood to collect a lump-sum payment of $100,000 and a two-year consulting contract for $4,000 a month after AEP received financing for the project. AEP expected to receive full funding in 2005, but the funding was not secured and the project was never built.
Hudson, who retired from DENR in 2005, pleaded guilty last year to extortion and money laundering. Hudson, sentenced to 40 months in prison, is incarcerated in the Butner federal correctional facility.
Duffy explained that Thomas “Ricky” Wright and Barry Green, both AEP investors, had a social and business relationship with Hudson that started in 1993. They met with Hudson in April 2004 to discuss specifically the ethanol project. Wright is a Wake Forest businessman, a former state Alcoholic Beverage Control commissioner, and has been a fund-raiser for Democrats. Green at one time had an ownership in Thee Dollhouse, an adult entertainment facility in Raleigh.
During a subsequent meeting at a North Raleigh restaurant, AEP President Brady requested that Hudson, who at DENR acted as a liaison with members of the state legislature and the governor’s office, use his official position to expedite AEP’s permits.
An FBI undercover operation played a significant role in developing the allegations against Brady and Perry. In September 2005 an undercover FBI agent, posing as a potential investor, expressed interest in the project and became acquainted with AEP officials and with Hudson. In separate meetings with the agent, Hudson described his efforts to expedite the permits but expressed concern that he had not been paid. The agent later provided Hudson with a $15,000 bank check as a first installment of AEP’s obligation to Hudson.
Neither Wright nor Green has been charged in connection with the AEP project.
Earlier allegations
In 2003 Carolina Journal first wrote about corruption allegations involving efforts to launch an ethanol production company in eastern North Carolina. Raleigh businessman William Horton alleged that Perry, former Northeast Commission CEO Rick Watson, and others conspired to keep him from building an ethanol plant in Beaufort County. AEP was formed after Horton made his allegations and the company ended up controlling the same site where Horton had planned to build his plant.
Don Carrington is executive editor of Carolina Journal.