August 26, 2014

Morgan County Judge-Executive Pleads Guilty to Accepting Kickbacks

LEXINGTON, KY—Timothy Alexander Conley, the Morgan County Judge-Executive, admitted in federal court today that he solicited and accepted over a hundred thousand dollars in illegal kickbacks from a bridge contractor.

Conley pleaded guilty in Lexington before U.S. District Judge Gregory Van Tatenhove to a charge of honest services mail fraud.

“The people of Morgan County placed their trust in Tim Conley, electing him as their Judge-Executive,” said Kerry B. Harvey, U.S. Attorney for the Eastern District of Kentucky. “Mr. Conley admitted in open court that he has betrayed the good people of Morgan County through the operation of an elaborate and criminal kickback scheme. This was not a one time lapse in judgment. Mr. Conley essentially transformed the public office he held to a criminal enterprise in order to serve his own purposes. The people of Morgan County deserved better and the price of this sort of criminal conduct is steep. We take no part of our responsibilities more seriously than the prosecution of corrupt public officials. Our law enforcement partners are to be congratulated on their superb work in this matter and, along with them, we will remain vigilant in the fight against public corruption in our district.”

Conley admitted that, between early 2009 through August 2013, he rigged the county’s competitive bidding process to ensure that contracts for certain Morgan County bridges were awarded to PBTHNOJJ Construction, a Salyersville, Ky., bridge contractor owned by Kenneth and Ruth Gambill. Conley admitted that, as part of that scheme, he directed Kenneth Gambill to deliver kickbacks to him from the proceeds of PBTHNOJJ Construction’s bridge contracts. For example, in 2013, Conley secretly altered bid documents for three bridges to ensure that PBTHNOJJ Construction would receive the contract to build each bridge. Conley solicited $15,000 per bridge and accepted $45,000 in cash from Kenneth Gambill for the three bridges.

According to the plea agreement, these kickbacks were part of a scheme to defraud the citizens of Morgan County of their right to Conley’s honest services.

Conley and the Gambills were indicted in December 2013. Last month, Kenneth and Ruth Gambill each pleaded guilty to conspiring to launder the proceeds of Conley’s kickback scheme.

Kerry B. Harvey, U.S. Attorney for the Eastern District of Kentucky; Howard Marshall, Special Agent in Charge, FBI, and Jack Conway, Kentucky Attorney General, jointly announced the guilty plea today.

The investigation was conducted by the FBI and the Kentucky Attorney General’s Office. This case is being prosecuted by Assistant U.S. Attorney Andrew T. Boone and trial attorney Jennifer Blackwell with the Public Integrity Section of the United States Department of Justice.

Conley will be sentenced on December 2, 2014. He faces a maximum prison sentence of 20 years and a $250,000 fine. The Gambills will be sentenced on November 18, 2014 and they each face a maximum of 20 years in prison and up to a $500,000 fine. However, any sentence will be imposed by the Court after consideration of the U.S. Sentencing Guidelines and the federal statutes.