Former state official sentenced in FBI sting

Former Deputy Insurance Commissioner Richard L. Chambers Sr. was sentenced Thursday in Baton Rouge to 30 months in federal prison for racketeering.

Chambers, 68, of LaPlace, was snared in an FBI sting known as Operation Blighted Officials. That sting also resulted in felony convictions for four area mayors, a police chief and a city councilman.

In addition to the prison term, Chief U.S. District Judge Brian A. Jackson ordered Chambers to pay $11,341 in restitution for bribes he received from FBI undercover agents he believed were corrupt businessmen. The judge also fined Chambers $10,500.

Chambers follows to prison his longtime mentor, former U.S. Rep. William Jefferson, D-New Orleans. Jefferson began a 13-year prison term in May 2012 for his conviction on bribery and corruption charges.

Jefferson helped create the state insurance commissioner’s deputy position for minority affairs, to which Chambers was appointed in 1988 after years of service as head of Jefferson’s political organization. By the time he left the department in 2010, Chambers was earning $116,105 annually.

“Such corruption undermines the dedicated and honest work performed by the vast majority of our public servants,” Acting U.S. Attorney Walt Green said of Chambers’ behavior in public office. “Today’s sentence reflects the seriousness of public corruption, while also appropriately crediting a defendant who accepts responsibility and substantially cooperates with the investigation.”

In Chambers’ criminal case in Baton Rouge, Assistant U.S. Attorney Corey R. Amundson said that Chambers agreed during the FBI sting to accept bribes in return for using his public office to help ‘corrupt businessmen’ gain a municipal insurance contract in Cleveland, Ohio.

The deputy insurance commissioner also was promised 40 percent of the commissions from that insurance contract and others he could deliver from municipalities in Louisiana, court records show.

Chambers estimated at the time of those discussions that commissions from those municipal contracts could range between $200,000 and $4 million.

Chambers admitted to Jackson that he accepted cash bribes to help other corrupt businessmen win contracts with small municipalities in the Baton Rouge area.

Those proposed contracts were for Cifer 5000, an FBI front company that provided city officials in Port Allen, New Roads, St. Gabriel and White Castle with illegal benefits.

Those officials accepted bribes, including cash, free hotel rooms, meals at expensive restaurants, and tickets to New Orleans Saints football games and New Orleans Hornets basketball games.

Cifer 5000 was promoted as a company that could effectively sanitize residential garbage cans. The firm did not exist, and indictments were returned before any contracts were signed.

Chambers advised former St. Gabriel Mayor George L. Grace Sr. and former White Castle Mayor Maurice Brown on insurance matters while he was deputy insurance commissioner for the state, his charges show.

And Chambers told undercover investigators, posing as crooks, he could influence the mayors’ decisions on insurance matters.

Grace was convicted on federal racketeering, mail fraud, bribery and related charges last year. He is serving a 22-year prison term.

Brown was convicted in 2011 on several charges, including racketeering and mail fraud. He is serving a 10-year term.

Former New Roads Mayor T.A. “Tommy” Nelson and former Port Allen Mayor Derek Lewis also were arrested because of Operation Blighted Officials and convicted on racketeering charges.

Nelson is serving an 11-year prison term. Lewis, who pleaded guilty and cooperated with prosecutors, is serving a term of 40 months.

Former Port Allen Police Chief Frederick W. Smith was convicted on charges that include racketeering and mail fraud. His prison sentence is for more than seven years.

Former Port Allen City Councilman Johnny Johnson pleaded guilty in 2010 to using a telephone in aid of racketeering and cooperated with prosecutors. Johnson was placed on probation for two years.

Six months of that time had to be served in a halfway house.

Advocate staff writer Gordon Russell contributed to this report.