Two Florida businessmen indicted in prison kickback case

By Lucy Morgan, Times Senior Correspondent
In Print: Friday, July 16, 2010

Former Florida Corrections Secretary James V. Crosby Jr. and Allen W. Clark, a regional manager for the prison system, collected more than $130,000 in kickbacks and gifts from two North Florida businessmen, according to a federal indictment released Thursday.

The two North Florida businessmen — Edward Lee Dugger, 63, of Gainesville and Joseph A. Deese, 37, of Fort White — were charged with paying the bribes so they could get into a business relationship with Keefe Commissary, a company that services grocery-style canteens at all state prisons. The two men own American Institutional Services, also known as AIS.

The prison canteen business is a lucrative, predominantly cash business that caters to inmates and their visitors.

Crosby and Clark went to federal prison three years ago after promising to cooperate with federal prosecutors investigating the bribes. The followup investigation was repeatedly delayed after several federal prosecutors in Florida's Middle District left for other jobs.

Dugger and Deese turned themselves in Thursday morning in Jacksonville and were released on $50,000 bond each. Dugger faces a maximum sentence of 25 years and Deese could be sentenced to five years. Federal prosecutors are also seeking forfeiture of more than $2.4 million, the amount they allegedly profited from the scheme.

The federal indictment accuses Dugger and Deese of making cash payments to Crosby and Clark ranging from $1,000 to $12,000 a month and also providing them with various gifts of food and alcohol during business conferences. The two businessmen also made payments to Keefe Commissary executives to obtain higher commissions, the indictment alleges.

The allegedly illegal payments continued until early 2006 when Crosby and Clark resigned in the midst of a public corruption investigation that also led to criminal charges against more than two dozen other prison employees. The charges included illegal steroid use, creating a phantom job for a prison softball team player, taking prison equipment and obtaining illegal services from inmates.

Crosby, 57, was a former mayor and city commissioner in Starke who began work as a prison guard in 1975. He became a political player on the state stage, raising money and support for Gov. Jeb Bush, who appointed him to the prison system's top job. Crosby remains behind bars at a federal prison near Pensacola. He is scheduled for release in 2014 but could earn a reduction in his sentence by testifying against Dugger and Deese.

Clark, 43, was a close friend and protege of Crosby's who was also a career employee of the prison system. Clark has been released from prison.

Both men were forced to forfeit their state pensions.

Steve Andrews, the Tallahassee lawyer who represents Crosby, refused to comment on the new indictments. Steve Dobson, the lawyer who represented Clark, also refused to comment.