The city of Dallas corruption trial begins against a local developer accused of bribing former councilors

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It is a transaction that occurs routinely in politics: the payment of money by a business owner to a public official in anticipation of a future favor.

But when is this payment an illegal bribe and when does it fall into the category of normal political interference? A federal jury in Dallas will soon decide the matter – at least in the case of local developer Ruel Hamilton, who is accused of bribing two former members of the Dallas city council.

On Monday, a jury was selected to hear the federal corruption process in downtown Dallas. The government will begin producing testimony and other evidence on Tuesday morning after opening statements. Prosecutors say Hamilton, 65, a longtime developer of affordable housing, made payments to Carolyn Davis and Dwaine Caraway in exchange for their help on the council with his real estate.

The alleged $ 40,000 bribe paid to Davis included “illegal campaign contributions for the candidates of their choice,” prosecutors say. The idea was to establish Davis as a policy advisor after she left the council so she could stand up for Hamilton and others, prosecutors said. At the time of the alleged bribery, Davis was chairing the council’s housing committee. In March 2019, she pleaded guilty. She died four months later in a car accident that also claimed her daughter.

The trial is the latest in a series of Dallas City Hall corruption cases brought before federal courts over the years. It is expected to take about three weeks. The case is noteworthy because it involves a white businessman who is said to have paid the bribes. Previous federal corruption proceedings in Dallas involved mostly local black politicians, leading to allegations by parishioners of racial bias in the prosecution’s decision-making.

The government says the money Hamilton paid was part of an illegal consideration; an agreement for certain official acts. But Hamilton has argued in court records that, like any other donor, he was legally giving campaign funds to local politicians.

“There is no denying that many people mistakenly equate the pursuit of the absolutely legitimate activities of the Amendment to corruption, including the types of campaign contributions and friendships with elected officials that this case is about,” said one of his lawyers , Abbe Lowell, in a litigation letter.

The government also claims Hamilton paid Caraway $ 7,000 in 2018 for his future assistance with a proposed real estate development that Hamilton was planning to build in Caraway’s neighborhood on 11th Street and Bonnie View Road in South Dallas.

Developer Ruel Hamilton at the Good Haven Apartments, one of his properties, in September 2016. Federal attorneys accuse him of bribing members of Dallas City Council on an indictment, but Hamilton is questioning this in his trial that begins this week. (Ashley Landis / photographer)

Hamilton’s company, AmeriSouth Realty Group, has built apartment complexes in southern neighborhoods over the years. The company owns and operates thousands of low-income homes in Texas and Oklahoma.

The 69-year-old Kümmel resigned from office in 2018 after pleading guilty to filing federal corruption charges involving former Dallas County Schools bus agency. He was sentenced to more than four years in prison in 2019 and is believed to be the main government witness in the Hamilton trial.

The indictment contains alleged conversations between Hamilton and the two former councilors suggesting that federal agencies have eavesdropping devices or other recordings that might support their case with evidence of motive or intent. For example, Hamilton reportedly asks Caraway what the indictment says he should write on the note line of a check for $ 7,000 he gave him.

“What should I write down for posterity’s sake?” Hamilton allegedly asked. “I just wrote something down there, just so … someone asks, I can come up with some kind of reference.”

If convicted on all four counts, Hamilton faces up to 30 years in federal prison.

Lowell, Hamilton’s attorney based in Washington DC, is known for defending numerous high-profile figures in business and politics over the years, including Bob Menendez, John Edwards, Jared Kushner, and Charles Keating.

Davis allegations

Hamilton needed Davis, who represented South Dallas, to help his Royal Crest Apartment Complex receive more than $ 2.5 million in public subsidies from the city council, the indictment said.

In return, Hamilton helped Davis pool campaign contributions to candidates of her choice so that she could “establish herself as an advisor and lobbyist” when she resigned due to term restrictions and “other Hamilton policy goals,” prosecutors say.

But Lowell has said in court records that his client only helped Davis raise money for the Dallas City Council candidates to “help her maintain goodwill with those candidates once she left office” .

That would give her the kind of access that would make her a “valuable lobbyist for Mr. Hamilton,” the defense said.

Hamilton hired Davis as a consultant and lobbyist after she left the council and charged her with at least $ 20,000 in advisory fees from 2015 to 2018.

Former Dallas City Council member Carolyn Davis as she exited the Earle Cabell Federal Building after pleading guilty in 2019 to accepting $ 40,000 in bribes from Ruel Hamilton.  She was killed four months later by a man who confessed to driving intoxicated.
Former Dallas City Council member Carolyn Davis as she exited the Earle Cabell Federal Building after pleading guilty in 2019 to accepting $ 40,000 in bribes from Ruel Hamilton. She was killed four months later by a man who confessed to driving intoxicated.(KXAS-TV / (NBC5))

Lowell said in court records that Davis helped Hamilton as a “community advisor, political advisor and lobbyist” in what he described as “an activity protected by the First Amendment.”

“If Mr. Hamilton could convince a jury that all he has done for Davis is to help her become an effective lobbyist who could help him once she leaves the DCC.” [City Council]that would be an absolute defense against bribery, ”wrote Lowell.

Prosecutors say Hamilton and Davis have also channeled money through nonprofits to hide the bribes and circumvent city rules that limit campaign donations to $ 1,000 per election.

Davis used Jeremy “Jay” Scroggins and his nonprofit hip-hop government to act as the middleman through whom these bribes were channeled, prosecutors said.

Scroggins, a defendant in the case, also pleaded guilty and was listed as a government witness at the trial. Davis told Scroggins in 2015 that “there’s nothing the FBI can do” that checks went to a nonprofit founded by an officer’s spouse, the indictment said.

Caraway allegations

Caraway, a longtime Oak Cliff councilor, admitted taking $ 390,000 from the owner of a company that made millions from the Dallas County Schools school bus agency in an independent federal criminal case. This corruption scandal led to several further convictions and the dissolution of the bus company.

Hamilton’s attorneys previously said the $ 7,000 check that Hamilton paid to Caraway in 2018 was meant to help the councilor cover medical expenses for himself and his ailing mother.

But prosecutors say Hamilton paid Caraway bribes more than once in connection with a property in the Caraway District. Several years prior to the alleged bribery in the indictment, Hamilton asked Caraway for help with “permits related to a parking problem on the property,” US Attorney General Andrew Wirmani wrote in a court filing.

“Caraway met the defendant on his property on Bonnie View Road and asked the defendant for $ 3,000 in return for his help,” Wirmani wrote.

Dwaine Caraway leaves the Earle Cabell Federal Building in April 2019 after being sentenced to 56 months in a federal corruption case involving Dallas County Schools.  He is now a government witness on a second suspected bribery case, this time related to Dallas City Hall.
Dwaine Caraway leaves the Earle Cabell Federal Building in April 2019 after being sentenced to 56 months in a federal corruption case involving Dallas County Schools. He is now a government witness on a second suspected bribery case, this time related to Dallas City Hall. (Shaban Athuman / staff photographer)

But Hamilton didn’t have that much cash on hand, so he was on the phone and a woman arrived in a Corvette and paid Caraway some of the money, the prosecutor wrote. Caraway received the remainder of the bribe days later, according to the court record.

Both sides have argued over whether the alleged second bribe should be presented to the jury.

“Since the two bribes concerned the same parties, properties and purposes, the court may indeed conclude that the events are ‘inextricably linked’,” Wirmani wrote.

The prosecutor called it a pattern that was “established” by Hamilton’s “repeated payment of bribes to Davis over a period of several years.”

Campaign funding

The latest indictment states that Hamilton carried out an illegal plan to “corrupt officials” from November 2013 to August 2018. Hamilton has applied for city grants, loans and federal tax credits for its projects, the government claims.

Hamilton has been a frequent donor to candidates in Dallas City Council and school board races. Previously, questions were raised about his practice of making large political donations on behalf of his wife and children – even his underage grandchildren.

Prosecutors claim that Hamilton wrote campaign checks on behalf of its employees without their knowledge. But Hamilton argues that this is not a crime.

“Mr. Hamilton has signed each of the checks in his own name and withdrawn money from his own bank accounts,” Lowell wrote in court records Campaign measures violate. “

A number of current and former city and district officials are on the witness lists on both sides. The government’s witness list includes Dallas City Secretary and former Dallas Mayor Mike Rawlings.

Defense witnesses might include Dallas City Councilor Carolyn King Arnold, District Judge Clay Jenkins, and former Councilors Scott Griggs and Philip Kingston.

This story has been updated to include details of how the judges’ selection will close on Monday.

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