RALEIGH – A former state environmental official was sentenced in U.S. District Court on Wednesday to 40 months in prison for his role in an extortion scheme to help a company build an ethanol plant in Beaufort County.
Judge Terrence Boyle sentenced Boyce A. Hudson, 67, also to three years of supervised probation, a fine of $35,000, and restitution of $15,000 to be paid to the FBI.
Hudson pleaded guilty in May to extortion and money laundering in connection with his efforts to help Agri-Ethanol Products LLC (AEP) obtain environmental permits through the Department of Environment and Natural Resources. AEP planned to build an ethanol production plant in Beaufort County.
Hudson was a senior field officer in DENR’s Legislative and Intergovernmental Affairs Office. In that capacity, he acted as a liaison with members of the state legislature and the governor’s office. Hudson retired from DENR in 2005.
Court documents show that AEP investors first met with Hudson in 2004 to discuss the project. During a subsequent meeting at a North Raleigh restaurant, the AEP president requested Hudson to use his official position to expedite AEP’s permits. In exchange for his assistance, the AEP president agreed that if Hudson could get AEP’s Air Quality Permit within 90 days, he would receive a $100,000 lump-sum payment, plus a two-year consulting contract for $4,000 per month after AEP received financing for the project. AEP officials expected to receive full funding in 2005, but the funding was not secured.
During a number of conversations with an undercover federal agent posing as a representative for potential investors, Hudson noted that he was unhappy that he had not been paid. The undercover agent provided Hudson with a $15,000 payment for his services to AEP.
A federal government motion filed early Wednesday said that after being confronted by federal agents in December 2006, Hudson offered substantial cooperation with the investigation, which remains open. On at least eight occasions Hudson “assisted investigators by wearing recording devices during conversations with a number of suspects of the investigation,” and he “consensually monitored telephone conversations on a number of occasions.”
The AEP investors and president have not yet been identified in court documents, but Boyle asked for Assistant U. S. Attorney John Bruce to identify the individuals. Bruce identified the two investors as Ricky Wright and Barry Green. He identified the AEP president as David Brady. Thomas “Ricky” Wright is a Wake Forest businessman and has been a fund-raiser for Democrats. Green at one time had an ownership in Thee Dollhouse, a former adult entertainment facility in Raleigh. Brady is a Raleigh businessman and real estate developer.
A federal subpoena to DENR sought documents relating to communications with Brady, Green, Wright, and former Northeast Commission CEO Rick Watson. Watson helped seek public money for the AEP project.
Brady, Wright, Green, or Watson have not been charged with any crimes, but Watson recently received a subpoena to appear in front of a federal grand jury. He also has hired Raleigh criminal defense lawyer Wade Smith. Smith told The News & Observer of Raleigh that he didn’t know what the subpoena was about.
The FBI, the IRS-Criminal Investigation Division, the U. S. Postal Inspection Service, the N.C. SBI, and the U.S. Attorney’s Office are conducting the investigation.
“This case is part of our offices’ continuing effort to prosecute corrupt public officials who abuse their public trust for private gain. This type of offense undermines the citizenry’s faith in government at al levels, yet these offenses can be very hard to detect and prosecute,” U. S. Attorney George E. B. Holding said in a prepared statement.
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 Watson, Wright, 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.
Plea for mercy
Before sentencing, 19 letters were submitted to the judge in support of Hudson. Letters came from several family members as well as Ellis Hankins, executive cirector of the N. C. League of Municipalities; Fred Baggett, city attorney for High Point; and State Sen. A. B. Swindell, D–Nash County.
Hudson’s wife, Mo, is Swindell’s clerk in the legislature. Swindell’s letter indicates he has a personal relationship with Boyle.
“Dear Judge Boyle: I shall never forget the time you and I spent together duck hunting in Hyde County. I miss Daddy so much – he is such a friend to so many. I trust your family is doing well – please tell Tom I said hello and that Mother is doing well at the Methodist retirement home in Greenville,” the letter says at the beginning.
Swindell eventually gets into the purpose of the letter. “You have a difficult job, and I know as I follow your career that you are always mindful of all the facts and circumstances. I want you to know that Boyce has always been faithful to his family and friends. He is one of the most dedicated public servants I have ever known.”
Carolina Journal was unable to reach Swindell for comment.
Don Carrington is executive editor of Carolina Journal.