NASHVILLE - Former state Rep. Robin Smith, R-Hixson, a political consultant, pleaded guilty in U.S. District Court on Tuesday to a single charge of honest services wire fraud in what federal prosecutors described as a kickback scheme involving the use of taxpayer-funded constituent mail.
Her sentencing was scheduled for Oct. 17, leaving time for her to cooperate in an ongoing federal investigation of a scheme that involved former Tennessee House Speaker Glen Casada and his former chief of staff, Cade Cothren.
"I have pled guilty to one count of honest services fraud," said Smith, who resigned from the House on Monday, in a statement later released by a public relations firm, Chattanooga-based Waterhouse Public Relations. "Once the Department of Justice informed me of the nature of my activities, I took full responsibility for my actions, culminating in my guilty plea. There are no excuses. I intend to cooperate fully as a witness with the federal government and do whatever I can to assist the government in this regard."
Earlier, U.S. District Judge Eli Richardson walked Smith through the plea agreement and the factual basis laid out in it.
"How do you plead?" he asked Smith, a former Tennessee Republican Party chairman.
"Guilty your honor," Smith said in a clear, steady voice.
Richardson allowed Smith to remain free on bond until the sentencing. Smith could face up to 20 years in prison and up to $250,000 in fines. But Richardson seemed to indicate she could end up getting probation or even a fine if she cooperates with prosecutors as she has agreed to do. She also could lose her voting rights, at least for a time, Richardson said.
As they left the courthouse in downtown Nashville, Smith and her attorneys did not respond to reporters' questions.
Prosecutors said Smith and Casada received kickbacks from Cothren, who lost his job in 2019 in a scandal over sex and racist-tinged texts with the then-speaker. After he was dismissed, prosecutors alleged, Cothren, Smith and Casada set up a shadowy political firm, New Mexico-based Phoenix Solutions LLC. It was run by a "Matthew Phoenix," a fictitious identity that prosecutors say was taken on by Cothren.
Smith and Casada pushed to press House Speaker Cameron Sexton's office to approve the firm as a House legislative constituent mail vendor, prosecutors said. The firm received tens of thousands of dollars and funneled portions back to Smith and Casada. Prosecutors have not publicly identified Casada and Cothren but clearly identified the former speaker and his former chief of staff in a formal information document used instead of an indictment.
The charge comes 14 months after FBI agents raided Smith and Casada's homes and legislative offices.
Smith used Phoenix Solutions extensively in 2020, spending nearly $75,000 through her personal campaign accounts and her Leadership Pioneers political action committee, through the fourth quarter of 2020. Much of the spending went toward supporting incumbent representatives and first-time candidates. That came as Smith challenged House Republican Caucus chair Jeremy Faison of Cosby for the House GOP's No. 3 post. Faison, who ended up winning the post, had questioned the use of Phoenix by the caucus.
Phoenix then began focusing on securing taxpayer-funded constituent mail agreements with legislators, Documents show Smith and Casada frequently communicating with legislative officials. Lawmakers get $3,000 a year for their constituent mail accounts.
As time went on, legislative officials began requiring "Matthew Phoenix" to supply more information. That resulted in the wire transmission of IRS form W-9 in 2020, which carried the signature of Matthew Phoenix.
That was under a provision noting that the certification is made "under penalties of perjury" and that the person signing the document is a "U.S. person."
The homes and legislative offices of Smith, Casada and another lawmaker, freshman Rep. Todd Warner, R-Lewisburg, as well as Cothren were searched by the FBI in January 2021.
Smith's legislative clients included Rep. Patsy Hazlewood, R-Signal Mountain, and Rep. Esther Helton, R-East Ridge.
Asked for reactions Monday to Smith's announced plea, both Hazlewood and Helton described it as a "sad day," declining to say much else. Both of them said they were astonished, as were a number of their colleagues, last year at news accounts raising questions about the constituent mail accounts and ties to Cothren.
In her statement, Smith said, "I have resigned as representative of the Tennessee House. I did so out of respect for the honor of Tennesseans, my commitment to public service over the last several decades, and of course, my Christian faith. I believe in forgiveness and I hope to earn yours over time.
"Serving is an honor. Rather than continuing to serve in the General Assembly, I intend to remain active in my community and my church. While this has been a difficult time in my life, I remain convinced that something positive will come out of it.
"As you can imagine, I am not able to provide any additional comment at this time. If you have any questions or need any additional information, I would refer you to the plea agreement, which speaks for itself."
Among those watching proceedings were former Rep. Rick Tillis, R-Lewisburg, and his wife. Tillis was successfully attacked by one of two other murky PACs during his GOP primary, this one called the Faith, Family, Freedom Fund.
Tillis had run afoul of both Casada and Cothren, who suspected him of operating an anonymous Twitter account that criticized and ridiculed both of them as well as some of the men's legislative supporters. A political vendor, who performed work for the group, had told the Times Free Press the independent expenditure group was run by Cothren.
Cothren's former girlfriend, listed as the treasurer, said she put her name on legal documents at Cothren's request.