Thu March 27, 2014
How The FBI's Case Against Cannon Went Down
On Wednesday morning, Patrick Cannon was Mayor of Charlotte and a rising political figure in the state. Less than 24 hours later he’s out on bond, no longer in government, and facing a host of federal charges. The story of his fall is one of undercover cops, multi-million dollar investments, bugged apartments, and feminine hygiene products. WFAE’s Ben Bradford and Tom Bullock bring us this report.
FBI agents in suits and ties walked out of Patrick Cannon’s house in Ballantyne and loaded boxes of evidence to their cars.
Around the same time – in Uptown, nine Charlotte officials stood behind a podium at government center. To a person they seemed exhausted, and sad. Mayor Pro Tem Michael Barnes said they were as shocked as anyone.
"His arrest came as a complete surprise to the city council and the city manager," Barnes said. "The first any of us learned about the investigation was when the FBI served a search warrant on the mayors office at noon today."
Shortly after that search began, the mayors office – indeed the entire wing on the 15th floor of Government Center was closed to the public. Armed guards stood outside. It wasn’t clear if the search by federal authorities was ongoing, or what had been taken.
The charges against Cannon were laid out in a complaint filed in US District court. It describes a years-long investigation, beginning in the Summer of 2010.
A local, undercover law enforcement agent — probably CMPD — caught whiff of possible public corruption, while working on another case. The FBI sent its own undercover agent to investigate. He posed as a businessman working for a Chicago venture capital firm, looking to invest in Charlotte.
The undercover agent struck up a relationship with then-city councilman Patrick Cannon, who ultimately became the primary target. Over the next few months, the FBI gathered evidence that the city councilman was trading political favors for cash. Then, it launched a sting operation.
The agent told Cannon his firm wanted to test the Charlotte market first by starting a bar or nightclub. But the location he wanted in Uptown had parking problems and would need a number of zoning changes to make it viable.
Talks between Cannon and the agent progress during 2012. This is where things get weird. The agent asks Cannon for help getting through zoning and permitting red tape. Cannon asks the agent to invest in a feminine hygiene product he’s developing called HERS.
We have no idea what HERS is supposed to be. There’s no website, no patent, no financial record of such a product, other than possibly a $1,000 wire transfer from Cannon to a business in Taiwan labeled R&D.
It all culminates in a December 2012 dinner. Here’s part of the FBI’s transcript:
AGENT: “I’m sure that, if we opened up a club, we don’t have any problems with the city and stuff like that, I can not only get you the HERS, but I can get it at like a zero percent return on investment for me.” He makes clear he’s talking about money for HERS.
CANNON: “Yeah, that’d be awesome. So all you’d need from me would be for me to…
AGENT: “Make sure I don’t run into any problems. I mean, and we’re not gonna create any major problems."
One month later, in January 2013, the two meet in an upscale apartment in SouthPark. It’s actually been rented by the FBI, and it’s rigged with microphones and cameras.
It’s there the agent allegedly gives Cannon his first bribe. The total? $12,500.
That was on January 17. On January 18, another city mayor is indicted before a federal grand jury for bribery and money laundering. That was New Orleans mayor Ray Nagin, who’s now serving prison time.
The undercover agent in Charlotte gets a call. It’s Patrick Cannon (again, from the FBI transcript):
CANNON: I certainly appreciate you helping me with seed money to move some things forward for HERS. But I wanna make sure that if if there has to be a connect per se, where that seed money is linked to me doing anything on the public side for you. I’m not comfortable with that.
Cannon offered to give the money back, and ended the call by saying he looked good in an orange necktie, not an orange suit.
Now this could be an instance of Cannon having cold feet, but he never gives the money back. In fact, he gets in deeper, and this time he brings his wife.
Now, again, this is according to the federal complaint.
Two days after Cannon announces he’s running for mayor, he meets a real estate developer from Las Vegas, who’s looking to build in Charlotte. Actually, another undercover FBI agent.
Little over a month later, Cannon with his wife in tow, is on a plane to Vegas. It’s an all-expenses paid trip. So, the mayoral candidate can convince a group of foreign investors to put their money into a commercial building in Charlotte.
Of course, he’s actually meeting with a bunch of undercover FBI agents.
The agent agrees to present Cannon to the foreign investors as a powerful politician who can get past any zoning or permitting issues. Cannon suggests that he could even help obtain federal money for the project.
For payment, Cannon has already suggested the agent give him a political contribution in return.
In Vegas, the agent gives Cannon $6,000 in cash - $1,000 of that is spending money given when the couple lands. Cannon’s wife later
calls to thanks the agent by phone.
This relationship of meeting, favors, and money accelerates. Over the next few months Cannon (allegedly) uses his clout to influence city officials and possibly zoning decisions. And he gets paid.
July 19: Agent gives Cannon $10,000 in cash. One of the fictitious investors has agreed to finance the fictitious development project proposed by the undercover FBI agent.
But, some fictitious investors are more critical than others. One is still skeptical about the project, so on February 21, now-Mayor Cannon invites him to his office at the top of the Government Center. And successfully convinces him to put his fictitious money behind the project as well. The imaginary project would be worth a grand total of $125 million.
And at the end of the meeting, Cannon is alone in his office with a briefcase. Inside is $20,000 in cash. But before he lets the undercover agent leave his office. He suggests he wants more. A lot more, and brings up his wife, Trenna.
CANNON: Okay. I, I told Trenna she has a point.
AGENT: She has a what?
CANNON: A point. One percent.
Agent laughs, but federal officials believe Cannon was asking for one percent of the entire payment: $1.25 million.
The agent agrees to meet Cannon in his office on March 26, 2014. That was yesterday. The last day Patrick Cannon was mayor of Charlotte. The day federal officials searched his home, his office, and arrested him.
He’s awaiting indictment on charges of theft and bribery.
Misusing his office for financial gain. All told he allegedly received more than $48,000 in bribes.
The most severe charges come with maximum sentences of 20 years and $1 million in fines.