By Bill Lodge
Advocate staff writer
July 03, 2012
A former deputy commissioner of the Louisiana Department of Insurance was charged Monday in Baton Rouge with racketeering in the FBI’s long-running corruption probe Operation Blighted Officials.
Richard L. Chambers Sr., 67, of LaPlace, was charged in a bill of information signed by U.S. Attorney Donald J. Cazayoux Jr. and Assistant U.S. Attorney Corey R. Amundson.
Chambers and his attorney, Assistant Federal Public Defender Mark Upton, signed a waiver of Chambers’ right to have the matter sent to a grand jury for possible indictment.
And Amundson filed a notice with Chief U.S. District Judge Brian A. Jackson that prosecutors and Chambers intend to file a plea agreement in the case.
Upton declined to comment Monday on the notice, which indicates that Chambers intends to plead guilty either to racketeering or some other criminal charge. A telephone once listed for Chambers was immediately disconnected when it was answered.
Chambers’ racketeering charge resulted from the FBI’s ongoing Operation Blighted Officials investigation, which has resulted in felony convictions against four Baton Rouge-area mayors, a city council member and a police chief since 2010.
As deputy commissioner of the Department of Insurance, the charge alleges, Chambers had oversight of “the Minority Affairs Division which assisted small, minority and disadvantaged insurance agencies and producers.”
Chambers is accused of accepting $5,500 in cash and a pledge of 40 percent of a Kenner insurance agent’s commissions for steering municipal insurance business to the agent. The charge states that Chambers was unaware that the “insurance agent” was an undercover FBI agent.
The charge also states that Chambers advised municipal officials, including former St. Gabriel Mayor George L. Grace Sr. and former White Castle Mayor Maurice Brown, on insurance matters while he was deputy commissioner.
“Chambers noted that he could use his official influence with Mayors Grace and Brown to cause their municipalities to direct insurance business” to the person he believed was a Kenner insurance agent, the charge alleges.
Chambers also is accused of writing an official letter of support intended to help the agent obtain insurance business from the city of Cleveland, Ohio.
Both Grace and Brown were convicted on racketeering and fraud charges that resulted from Operation Blighted Officials.
Brown is serving a prison term of 10 years. Grace is scheduled for sentencing Aug. 27.
Grace, Brown, former New Roads Mayor Tommy Nelson and three officials in Port Allen were snared in a sting involving an FBI front — Cifer 5000. That was a fictional firm through which bribes were paid for pledges of municipal contracts for sanitizing garbage cans.
Nelson is serving an 11-year prison term.
Cifer 5000 bribes also were paid to Port Allen officials.
Former Port Allen Mayor Derek Lewis was sentenced by Jackson to 40 months in prison. Former Port Allen Police Chief Fred Smith was sent to prison for 90 months.
Former Port Allen Councilman Johnny Johnson was sentenced to six months at a halfway house and two years of probation.
Like the municipal officials he advised, Chambers also accepted bribes from undercover investigators in the Cifer 5000 sting, according to the charge filed against him.
A venture capitalist from Dallas asked Chambers to write an official letter of support that could be used to attract investors to Cifer 5000, according to the racketeering charge.
The venture capitalist was an undercover FBI agent.
The charge alleges that Chambers provided the official letter to the venture capitalist in exchange for $2,000 in cash delivered May 12, 2009, and another $3,000 provided the next day.
Chambers’ racketeering charge carries a possible penalty of five years in prison and a fine of $250,000.