Just Say “No” to Greene Group

Posted on April 10, 2011 in Uncategorized | by

Part I
Today, Monday, April 11, at 1:00 p.m. the Board of Ada County Commissioners will auction off a five-plus-year lease for the operation of Les Bois Park. It is widely expected that there will be only one bidder.

The likely bidder, Treasure Valley Racing, LLC, (“TVR”) was formed on March 1, 2011. The name of their registered agent is Mary J. (“Joie”) McGarvin, the assistant of lobbyist Russ Westerberg. The members or managers listed on the paperwork of the Idaho Secretary of State’s office are: Scott M. Phelps, Larry Dale Williams, Harry L. Bettis and James R. Grigsby. TVR is a partnership among principals in the Greene Group through their wholly-owned subsidiary, Alabama-Idaho, and a number of wealthy local businesspeople.

It should be noted here that Westerberg was also Director of the Greene Idaho Foundation from 2002 to 2006. Greene Idaho Foundation is a so-called non-profit corporation, originated by the Greene Group of Alabama’s Paul W. Bryant, Jr., Scott Phelps and Sam Phelps for the sole purpose of conducting “charitable bingo” at the race track in Post Falls. Money that goes to charitable causes is donated at big media events involving politicians. It’s a cost-effective way for the Greene Group to buy political favor.

The Greene Group and Alabama-Idaho principals include: Paul W. Bryant, Jr., President; A. Wayne May, Vice President; Scott M. Phelps, Vice President and Secretary; and, Sam Phelps, Treasurer. These names are important to remember as this ugly story unfolds.

According to page 8 of a December 31, 2006, investigation by the State of Alabama’s Department of Insurance, Alabama-Idaho has a 90 percent ownership interest in Coeur d’Alene (CDA) Racing, Ltd. Greyhound Park and Event Center is an assumed business name for CDA Racing.

For numerous reasons, I believe these people to be less than the upstanding, ethical citizens we want operating a gambling and alcohol distribution operation – heavily subsidized by county taxpayers – on Ada County property. Keep in mind that Les Bois Park is publicly owned and no property taxes will be paid on the real property.

On September 17, 1995, Spokesman-Review investigative reporter J. Todd Foster wrote:

“Four years, and greyhound dog trainer Larry Conarty can’t shake the nauseating memories.

“He still recalls the festive atmosphere, the trainers who sipped beer, smoked marijuana and snorted cocaine after-hours at Coeur d’Alene Greyhound Park, priming themselves for 20 seconds of entertainment. An unlucky four-legged lady, a born loser on the track and unfit as a pet, was taken from her wooden crate, placed on a wet floor and prepped for the ‘Tijuana hot plate.’

“A stiff wire was oiled and shoved up the dog’s rear end. An alligator clip was pinched onto her lip and another wire grounded on a metal gate. A jolt of electricity later, the dog was dead, bagged and thrown into a pickup for the next day’s run to the dump.”

The next page of the article goes on to report:

“Al May, Coeur d’Alene Greyhound Park’s operations manager, says the track will be absolved of wrongdoing.

“The track, May says, has little control over what handlers do after-hours on property they lease. Between 12 and 15 trainers are hired on a contractual basis and are not track employees, he adds.”
Granted, these events took place over 15 years ago, but “Al May” now goes by A. Wayne May. Could it be that the negative publicity surrounding this veterinarian’s involvement with the atrocities at the Greene Group’s Greyhound Park has such a rancorous odor these many years later that he is still trying to distance himself from that era?

Time has passed, but based on the way in which Greene Group principals allowed dogs to be mistreated, abused and killed at their north Idaho facility, I certainly do not want to see these same people granted the right to lease and oversee horseracing at the publicly-subsidized Les Bois Park.

Part II

Greenetrack was incorporated on August 28, 1995, by the Greene Group’s Paul W. Bryant, Jr., to “operate a greyhound race track” according to the records of the Alabama Secretary of State. According to other materials, the track had already been operating since 1977, prior to the 1995 incorporation.

“A DESCRIPTIVE CASE STUDY OF THE GREENE COUNTY, ALABAMA BANKRUPTCY” from the Journal of Public Budgeting, Accounting & Financial Management, Fall 2009 by Deal, Keren, Kamnikar, Judith, Kamnikar, Edward reports that:

“A unique finding in the 1994-1997 examination referenced the transfer of ownership by the Greene Group of the Greenetrack greyhound racing facility in Greene County to the county government and the Greenetrack employees. The agreement was interpreted by the examiners as a shared ownership between the Greene County government and the track employees.”

In 1996, Greene County, Alabama, was only the second county in the country to file for bankruptcy protection. (The first was Orange County, California, in 1994.) Paul W. Bryant’s Greene Group and Greenetrack figured prominently in the financial struggles of this small, poor county. For further information on the connections, see pages 8 and 9 of the above-referenced case study.

Part III

Experienced Birmingham reporter Roger Shuler authors a convincing blog, humorously named “Legal Schnauzer”. His claims, although sometimes speculative, are documented and clearly presented. Shuler, who gives his location as Birmingham, Alabama, writes of himself:

“Have bachelor’s degree in journalism (U of Missouri, 1978) Worked 11 years for daily newspaper. Worked 18 years as university editor. Married, no kids, two cats.”

The January 13, 2010, issue of “Legal Schnauzer” reports that:

“(Andrew W.) Stewart was convicted in December 1997 on 135 counts of racketeering, mail and wire fraud, and money laundering. His conviction was upheld on appeal in 1999, and his motion to vacate the sentence was denied in 2001. Stewart forfeited about $17 million in 2003.”

Why should we care about Andrew W. Stewart? Let’s back up for a minute and fill in a few gaps. Stewart wasn’t acting alone. He had “accomplices.” One of them was the Alabama Reassurance Company, a wholly-owned subsidiary of, you guessed it, the Greene Group.

The “Legal Schnauzer” article goes on to say that:

“We can find no record of the mainstream press reporting on (Greene Group’s) Paul Bryant Jr.’s connections to the Allen W. Stewart case. Documents showing the connections, however, are readily available on the Internet.”

Shuler’s article is well worth taking the time to read, but the bottom line is that Andrew W. Stewart worked with Paul W. Bryant Jr.’s company, Alabama Reassurance, to inflate their financial statements. Shuler sums up the situation: “The bottom line in everyday terms? Allen W. Stewart, with the help of Alabama Reassurance, left policyholders holding the bag. Sounds a lot like Enron, WorldCom, and others, doesn’t it?

“Allen W. Stewart is paying a heavy price for his crimes. But what about those who run Alabama Re, including Paul W. Bryant Jr.? There is no sign that they have been held accountable in any way.”
Why would we want Paul W. Bryant, Jr. and the rest of his Greene Group associates to run the county’s horse racing facility, Les Bois Park? I do not.

Part IV

In 2006, the State of Alabama Department of Insurance investigated the Alabama Reassurance Company, Inc., a wholly-owned subsidiary of Paul Bryant, Jr.’s Greene Group. Directors included Paul William Bryant, Jr., Allen Wayne May, Sam Moore Phelps, Scott Moore Phelps, and William Rodney Windham. The results of the report are relevant because four of these individuals are principals in the Greene Group’s Alabama-Idaho, Inc., and subsequently, are also business partners in Treasure Valley Racing, LLC.

Numerous deficiencies were found in the Department of Insurance investigation. The January 21, 2010, article, “Paul Bryant Jr. and Alabama Reassurance: A Portrait of Fraud” from the “Legal Schnauzer” blog (http://legalschnauzer.blogspot.com/2010/01/paul-bryant-jr-and-alabama-reassurance.html) provides a comprehensive summary of the findings of the investigation:

“The DOI takes Alabama Re to task for all kinds of shortcomings and violations of the Code of Alabama. In fact, the report devotes 14 pages to noting how the company could better handle its operations. One gets the impression that the good folks at Alabama Re don’t much care what the Department of Insurance thinks.

“Here are just a few of Alabama Re’s “best practices,” areas that the DOI said needed major attention:

* Risk of water damage to computer center;
* The backup tape log has a success rate of less than 50 percent;
* No formal records-retention policy;
* No computer-security policy;
* No emergency response procedures;
* No business contingency plan;
* No anti-fraud plan; and
* Daily backups stored at off-premises location.

“Some corner lemonade stands probably have better business procedures than Alabama Re. And yet, the company is not a small-time operation. A 1997 report by the U.S. Department of Health and Human Services, Assistant Secretary for Planning and Evaluation (ASPE), ranked Alabama Re among the country’s top 50 reinsurers.”

According to “Legal Schnauzer,” Alabama Reassurance Company, Inc., is now gone, replaced by another Greene Group insurance venture, Alabama Life Reinsurance Company.

“Interestingly, Alabama Re is no more, at least not in its original form. As of late 2007, according to the DOI report, the company was merged into Greene Group Inc. and liquidated. A new company, Alabama Life Reinsurance Company, was formed. It has two assumed reinsurance treaties–with Security Life Insurance Company of America and North America Insurance Company of Texas.

“The statute of limitations on crimes associated with the Allen W. Stewart case almost certainly has passed. With the liquidation of Alabama Re, any evidence of ongoing irregularities might be gone with the wind, too.”

According to the Alabama Secretary of State’s records, the incorporator of Alabama Life Reinsurance Company was Alabama Reassurance Company, Inc., on December 22, 2006, just days before the DIO report was issued. Although Alabama Re is no longer in existence, its new iteration has filed annual reports every year since its inception, including the most recent one in 2010.

Why would we want the Greene Group people of Alabama Re who were found by the Alabama DOI to have such shoddy, if not downright illegal, business practices to run Les Bois Park?

Part V

On October 4, 2010, Milton McGregor, another of the Greene Group’s Paul W. Bryant’s former (and possibly current?) business partners was arrested.

Legal Schnauzer’s Roger Shuler does a good job of documenting the relationship between Bryant and McGregor in his January 21, 2010, article:

“Bryant, the son of Hall of Fame football coach Paul “Bear” Bryant and a member of the University of Alabama’s board of trustees, is president of Greene Group Inc. One of his companies, Alabama Reassurance, was implicated in a $15-million fraud scheme involving a Philadelphia lawyer and entrepreneur named Allen W. Stewart.

“MILTON MCGREGOR Born in Hartford, a Wire¬grass peanut-farming town on the Alabama-Florida line, McGregor launched a side business of electronic arcade games called McGregor Amusement while working as a civilian em¬ployee at Fort Rucker. By 1981, in the midst of the vi-deo game craze, that be¬came his full-time business. In partnership with PAUL W BRYANT JR.,who owned Greene County’s greyhound track, Greenetrack, the com¬pany leased video games to convenience stores across south Alabama and the Flor¬ida Panhandle.”

Another account of the relationship between the two businessmen is found in a November 28, 2010, bleacher report.com article by Mark Hancock:

“It turns out that McGregor was also a partner with another Alabama gambling magnate, Paul Bryant, Jr., son of the late great Bear Bryant, in casinos and dog tracks, some of which have now been closed.”

On October 4, 2010, Charles J. Dean of The Birmingham News wrote:

“FBI agents armed with arrest warrants today gobbled up 11 legislators, lobbyists and the owner of the state’s largest electronic bingo casino, all indicted in a scheme to buy and sell votes that prosecutors called “astonishing in scope.”

“The indictments come six months after prosecutors and the FBI stunned legislative leaders by informing them that an investigation was under way into vote buying related to the successful effort in the Alabama Senate just days before to pass electronic bingo legislation.

“U.S. Department of Justice prosecutors laid out the inducements this morning at a press conference in Washington.

“’Today, charges were unsealed against 11 legislators, businessmen, lobbyist and associates who, together, are alleged to have formed a corrupt network whose aim was to buy and sell votes in the Alabama Legislature in order to directly benefit the business interests of two defendants, Milton McGregor and Ronald Gilley,’ said Lanny A. Breuer, assistant attorney general of the Criminal Division. ‘The people of Alabama, like all our citizens, deserve to have representatives who act in the public’s interest, not for their own personal financial gain. Vote-buying, like the kind alleged in this indictment, corrodes the public’s faith in our democratic institutions and cannot go unpunished.’”

This situation reminds me of my first taste of the Greene Group, when their Idaho lobbyist Russ Westerberg and his assistant Joie McGarvin asked me out for coffee after I won the November 2008 election. Westerberg asked whether I was willing to put out a Request for Proposals for the Les Bois Park lease. Willing? Why wouldn’t I vote to put out an RFP, so the county could identify the best operator for the facility? I assured them that it seemed the most reasonable course of action.

At the end of the meeting, Westerberg asked me if I had any campaign debt that needed to be paid off. I assured him that I not only had no remaining campaign debt but that I also do not take money from special interests. He responded by explaining that he had given a campaign contribution to my recent opponent, Ada County Commissioner Paul Woods, because Paul had been helpful.

There is a reason I refuse to take special interest money. When faced with a decision such as whether to allow a group such as Treasure Valley Racing, LLC, with their Greene Group partners and background, it is not necessary to take into consideration prior campaign contributions. My only consideration is what is best for all of the nearly 400,000 people of Ada County.

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5 Responses to “Just Say “No” to Greene Group”

  1. Can't wait for racing! says:

    I highly doubt Yanke, Gigsby, Willims, and Bettis would invest their money in people that are a bad as you seem to think Greene Group is. However your choice, Eric Spector did a great job destroying Idaho, Wyoming and Montana! Heading to Emmett next weekend and then hopefully Les Bois Park very soon. Very excited!

  2. Karen J says:

    Very informative, Sharon–but why did you never expend the same energy in researching or use the same Web forum to expose the unsavory dealings of Spector Entertainment, [formerly] dba many failed Intermountain race venues? Even a casual Google search reveals the bait-and-switch patterns of Eric Spector’s sports enterprises, from women’s beach volleyball (yep–look it up) to live and simulcast horseracing to … We’ll see …

  3. bikeboy says:

    Sharon, THIS taxpayer thanks you for your conscientious oversight of the horse racing venue. (I can’t believe how low some people get in their rude comments – see the Statesman story’s comments. We’ve become a low-class, impolits society.)

    I didn’t read your reasoning in depth, although I glanced over it. In my 57 years of living in Boise, Ada County, I’ve never once gone to the ponies. No interest. (And thus limited interest in this whole lease business.)

    Frankly, I have reservations about the government being in the business of liquor, gambling, etc., in the first place, but I guess that’s the way it’s done in these parts. (I have no objections if adults want to engage in those activities, as long as they are willing to sponsor them, as well as the ensuant costs to society at large.) I object to the notion of the facility and activity being “heavily subsidized by county taxpayers.”

  4. Frank Walker says:

    I couldn’t agree more. Ada county has subsidized horse racing far too long for a “handful” of interested parties. The race track is no doubt in the lowest 1% of highest and best uses for this property.

  5. Interested Party says:

    Actually Bryant and McGregor go way back to 1983 when Bryant, Phelps and May formed Paramutuel Mamagement and secured a 10 million dollar loan to build McGregor’s dog track. They also had a contract to run the operation once it was built. This alliance resulted in Bryant getting sued by his own company Greene Group for using the company’s assets and credit for his own personal gain. Greene Group eventually won on appeal.

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