April 23, 2015

Former District Attorney Walter P. Reed and His Son, Steven P. Reed, Charged by Federal Grand Jury in 18-Count Indictment

U.S. Attorney Kenneth A. Polite announced that former District Attorney for the 22nd Judicial District,WALTER P. REED, age 68, and STEVEN P. REED, age 43, both from Covington, were charged with offenses related to their involvement in a conspiracy to commit wire fraud and money laundering related to the misuse of funds from WALTER P. REED’S campaign account. Additionally, WALTER P. REED was charged with wire fraud for his personal misuse of campaign funds, mail fraud based on his diverting into his personal accounts funds from St. Tammany Parish Hospital that were intended for the Office of the District Attorney for the 22nd Judicial District, and filing false tax returns.

According to the Indictment, WALTER P. REED and STEVEN P. REED devised a scheme to defraud the Walter Reed Campaign and contributors to the Walter Reed Campaign by using donations toWALTER P. REED’S campaign to pay for goods and services either unrelated to the campaign or in an amount that grossly exceeded the value of the services provided.

The Indictment alleges that WALTER P. REED caused a series of payments to be made from the Campaign Fund to STEVEN P. REED’s companies in order to pay down a loan on which WALTER P. REED was a cosigner for services that either were not provided or whose value was substantially less than the amount paid. For example, WALTER P. REED caused, STEVEN P. REED’S company, Globop, to be paid approximately $8,352.64 for producing a housewarming party at WALTER P. REED’S new condominium in April 2012 that was unrelated to WALTER P. REED’S campaign. Similarly, STEVEN P. REED’s company, Liquid Bread LLC, received $29,400 from the Campaign Fund account for purportedly providing catering or bar services at a campaign event at the Castine Center in September 2012 that STEVEN P. REED did not actually provide. WALTER P. REED also required two companies that provided services at the September 2012 event to kickback a portion of their payments toSTEVEN P. REED as a means to funnel campaign monies to him.

WALTER P. REED also paid for numerous other personal expenses unrelated to his campaign out of his Campaign Fund, including flowers with an accompanying message that stated, “[T]o my rodeo girl from a secret admirer from Camp J,” $1,885.36 for a Thanksgiving Day dinner for REED and approximately ten other members of his family and a $500 gift card for his future personal use, and $2,635.00 to a North shore steakhouse for a dinner he hosted for “Pentecostal Preachers” for the purpose of recruiting clients to refer him private civil legal work. Subsequently, REED also sought, and received, a reimbursement for the $2,635.00 dinner from the law firm with which he was affiliated, which he did not then put back into his Campaign Fund. In total, WALTER P. REED, spent at least $100,000 from the Walter Reed Campaign Fund bank account on personal expenses in this manner, including to recruit potential clients for his private legal practice, to pay off various expenses incurred by his son, STEVEN P. REED, and to pay for private and personal dinners.

The Indictment also alleges that WALTER P. REED diverted money paid by St. Tammany Parish Hospital for work performed by the Office of the District Attorney to his personal bank account. Specifically, between about 1994 and 2014, St. Tammany Parish Hospital retained the services of the Office of the District Attorney to advise it on various matters, for which it agreed to pay between $25,000 and $30,000 per year. REED attended some of the monthly meetings, though on dozens of occasions he directed Assistant District Attorneys to attend. Notwithstanding REED’s use of resources and personnel of his office, REED deposited into his own personal bank account each check provided by St. Tammany Parish Hospital that were intended for the Office of the District Attorney.

If convicted, WALTER P. REED faces up to 277 years in prison, followed by up to a three (3) year term of supervised release, and up to a $ 4,500,000 fine. STEVEN P. REED faces up to 65 years in prison, followed by up to a three (3) year term of supervised release, and up to a $1,000,000 fine.

United States Attorney Polite reiterated that the Indictment is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.

U.S. Attorney Polite praised the work of the Federal Bureau of Investigation and the Internal Revenue Service – Criminal Investigation for investigating this matter and thanked the Metropolitan Crime Commission for their assistance. The prosecution of this case is being handled by Assistant United States Attorney Jordan Ginsberg and First Assistant United States Attorney Richard Westling.