Edwin W. Edwards, the colorful three-term Democratic governor of Louisiana, was indicted today on 50 counts of conspiracy, racketeering, mail fraud and wire fraud in connection with an alleged scheme to award valuable state certificates of need to private health-care corporations in which he had a concealed interest.
The indictment, handed down this afternoon by a federal grand jury supervised by U.S. Attorney John Volz, alleges that Edwards, as a private citizen, earned $1,954,478 in the conspiracy between February 1982 and March 1984, when he returned to the governor's office after a four-year hiatus from elected office.
It also alleges that, after he became governor in 1984, Edwards approved five certificates of need for his business partners and that his brother, Marion D. Edwards, received $1,016,081 from the scheme. It alleges that the payments to Marion Edwards were intended for the governor.
Edwards, 57, a spellbinding Cajun orator and one of the most popular figures in this state since former governor Huey (Kingfish) Long, said late this afternoon in Baton Rouge that he would not comment on the indictments until Friday.
But earlier this week, when the indictment seemed imminent, the governor asserted his innocence, said that he was the victim of a polically motivated Republican prosecutor and vowed to remain in office. He said he intended to participate in his defense, perhaps even giving the summary argument to the jury.
"I'm the best lawyer there is," Edwards said.
While the grand jury met for six hours, Edwards visited his doctor in New Orleans. "I'm healthier now that I was a year ago," he told reporters. "I'll be around to live out any sentence . . . that might result from this."
If convicted on all counts, Edwards could face 265 years in prison, $74,000 in fines and the forfeiture of all his gains from the deal.
Even if he were convicted and imprisoned, however, he would not automatically lose his office. In Louisiana, governors and lieutenant governors can be removed from office only by impeachment or recall.
The indictment, long expected from a grand jury that has been sitting for six months, created a sensation here.
It comes in the midst of one of the most tumultuous weeks in state political history, with the unexpected announcement Monday that Sen. Russell B. Long (D-La.) would retire and the continuing probe by another federal grand jury into the activities of Lt. Governor Robert Freeman. Freeman reportedly is a target of an investigation into the awarding of demolition contracts for the 1984 New Orleans Worlds Fair.
In addition to Edwards and his brother, five other businessmen were named in today's indictment, including Edwards' nephew, Charles David Isbell.
The fourth was Ronald Falgout, a former under secretary of the Louisiana Department of Health and Human Resources and vice president of the Health Services Development Corp. (HSDC), which sought certificates of need from the state and resold them at considerable profit to developers of hospitals and nursing homes.
The others are James J. Wyllie Jr., president of the HSDC; Gus Mijalis, a business associate and fund-raiser for Edwards, and Perry J. Segura, a hospital architect.
Their alleged conspiracy is complicated. "It's just not very easy to sum up in 50 words or less," Volz told a news conference after the grand jury issued the indictments.
The defendants are accused of using Edwards' clout, while he was out of office and after he returned, to win 15 certificates of need from the state. The so-called "1122 permits" enabled developers of health-care facilities to be reimbursed for their capital expenditures by the federal government in proportion to the number of Medicare and Medicaid patients treated.
The alleged scheme began in 1982, when it was widely assumed that Edwards would be a candidate for election in 1983. Edwards' role, the indictment charges, was concealed from the start so he would be able to benefit the company later as governor.
As governor, the indictment alleges, Edwards appointed four people recommended by Falgout to supervise the state 1122 permit review process and removed one state official who had given Falgout trouble in the past. He also declared a moratorium on the issuance of all 1122 permits last Aug. 1 but exempted eight pending projects, five of which belonged to his business partners.
Edwards has not denied receiving nearly $2 million for his work with the hospital group while out of office and has boasted that he earned the money for doing relatively little work. "I just waltzed things back and forth," he said late last year.
But he has said there was no connection between his private business dealings and his actions as governor.
A key aspect of the case will be to show that Marion Edwards received more than $1 million from the company after his brother resumed office and that the money paid to him was ultimately to go to the governor.
Gov. Edwards, the French-speaking son of a sharecropper from South Louisiana, was first elected in 1971 as a populist, progressive governor. He has used patronage unapologetically and has been dogged throughout his career by the faint scent of scandal. Before today, he had survived six federal and three state grand jury probes without indictment.