Timothy Cahill indicted on charges of using official funds for campaign-boosting ads

Then-Treasurer Timothy Cahill winked at staff members on Oct. 1, 2010, after he announced he was staying in the Massachusetts governor's race despite the defections of top campaign aides and his running mate. His father, Paul, applauded at right.
Then-Treasurer Timothy Cahill winked at staff members on Oct. 1, 2010, after he announced he was staying in the Massachusetts governor's race despite the defections of top campaign aides and his running mate. His father, Paul, applauded at right.
Stephan Savoia.AP

A Suffolk County grand jury has handed up indictments against former state Treasurer Timothy P. Cahill on corruption charges that his campaign allegedly used $1.65 million in taxpayer-funded state lottery advertising to boost his floundering 2010 gubernatorial bid, Attorney General Martha Coakley said today.

Cahill, who becomes the first statewide office holder to be indicted since at least 1950 on corruption charges relating to his official duties, was charged with directing the Massachusetts Lottery to launch the media blitz intended to run from mid-September though the November election.

Cahill “made a decision with others to abuse his position of trust and put his own political ambition before the best interests of the taxpayers,” Coakley said at a news conference this afternoon. “Those ads weren’t directed at the lottery. They were directed at the independent candidacy of then-Treasurer Cahill.”

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Cahill’s name and picture were not used in the ads. But Coakley said the essence of his alleged crime was “using public resources to give yourself an edge which other people wouldn’t have.”

She said Cahill faces charges of violating state ethics laws, violating state procurement laws, and conspiracy charges in connection with both those alleged crimes. The procurement and ethics law violations each carry possible sentences of up to five years in prison and a $10,000 fine.

Also indicted were Scott Campbell, Cahill’s former campaign manager, and Al Grazioso, the lottery chief of staff, Coakley said.

Cahill’s attorney, E. Peter Parker, said in a statement that “the truth is that nobody did anything wrong.”

“We are confident that a jury will agree and in the end, the Attorney General will have wasted an enormous amount of time, energy and scarce resources to bring criminal charges that never should have been brought,” Parker said.

A tweet sent under the Twitter handle of Cahill’s wife, Tina, said, “A good man is being persecuted for challenging the status quo. It’s not enough to be defeated. You need to be destroyed politically & personally.”

Another tweet under the handle of one of his four daughters, Nicole, said, “This is why good people don’t get into politics. It’s a shame.”

Cahill called off the ad campaign just two weeks before the election when emails emerged in a civil suit that showed that he and top campaign aides had allegedly concocted the advertising plan. The television and radio ads touted the state Lottery, which he controls, as a well-run operation that returns billions of dollars to cities and towns.

State law prohibits public officials from using their position or public resources to advance their political careers if it is done with “fraudulent intent.’’

Coakley’s office began its investigation shortly after internal campaign emails emerged in the civil court case in October 2010 indicating that Cahill’s political staff had consulted with him and gotten his approval to use the Lottery ads to boost his independent gubernatorial candidacy.

Internal Lottery emails obtained by the Globe last June confirmed Cahill, who chaired and controlled the agency, was directly involved in the shift to an ad strategy that would promote a theme of how well its operations are managed and how its nearly $1 billion in profits are funneled back to cities and towns.

It came at a critical time in his independent campaign for governor, a race in which he only got 8 percent of the vote, far behind Republican Charles D. Baker and Governor Deval L. Patrick, a Democrat who won re-election.

Cahill, through his attorney, has not denied he was involved in ordering the change to the initially planned Lottery ad strategy which was aimed promoting individual games.

He said he was compelled to act because the agency’s image was badly tarnished—and the sale of tickets threatened—when the Republican Governors Association, looking to help Baker, attacked Cahill in a $2 million ad campaign aimed at destroying his candidacy.

“The RGA attack ads had undermined public confidence in the Lottery and hurt sales measured year over year. ... Treasurer Cahill had an obligation to maximize Lottery revenues. He and the Lottery made the right choice to run the ads,” Cahill’s attorney, Parker, argued again today in his statement.

Coakley said that Campbell, the former campaign manager, faced charges of conspiracy to violate the state ethics law, procurement fraud, and conspiracy to commit procurement fraud. Grazioso, the chief of staff, faces two counts of obstruction of justice for trying to impede the investigation.

Prior to 2009 changes in the state’s ethics laws, the ethics charges against Cahill and Campbell would have been civil violations, Coakley’s office noted. Now they are felonies.

House Minority Leader Bradley H. Jones Jr. said in a statement that the indictment was “another black-eye for politics in Massachusetts” and a “call to arms for ethics reform on Beacon Hill.”

State Treasurer Steven Grossman, Cahill’s successor, said in a statement that the indictments “detail fundamental and outrageous violations of the public trust, as well as gross abuse of public office.” He said his office had cooperated fully with the attorney general’s probe and would continue to do so.

There was no answer at Cahill’s white, two-story home on Grenwold Road this afternoon in Quincy, where several reporters were camped outside.

A neighbor, Bobby Beniers, 72, said he has lived next to the Cahills for over 20 years and described the former treasurer as a good neighbor who regularly cleans his yard. Beniers said he did not know much about the indictment but said he thought the state Democratic party may have pushed the case forward to retaliate against Cahill after he ran against the party incumbent in 2010.

“He’s the one that went against them. I would think they had a little animosity towards him,” Beniers said.