Let's Make A Deal

Convicted felons Mike and Pat Graham are at it again, trading allegations for favors

When asked at his deposition if he and his brother have been excused from making good on the debt as part of their agreement with prosecutors, Pat Graham could only speculate.

"Well, my theory is this," Pat declared, "until all the investigations are over with, I just don't believe that they're going to be real aggressive in attacking those assets."

No kidding, say defense attorneys, who maintain that prosecutors have entered into an unspecified financial arrangement with the Grahams vis-à-vis their tax problems. Mike Ramsey, an attorney for Yank Barry, the Canadian businessman accused of bribing Collins, says he'd be "very surprised" if the Grahams ever pay their back taxes.

Edwin Edwards's deal-making finally caught up with him.
Edwin Edwards's deal-making finally caught up with him.

"It amounts to legalized bribery," Ramsey says. "If I got to bribe witnesses, if somebody just told me, 'Okay, you can pay witnesses anything you want to, any way you want to,' I'd never lose another case. It's a nasty system, but the feds do it as a matter of routine."

G<1>ary Cobe, a low-key, straight-shooting lawyer with the U.S. attorney's office in Houston, is almost as interested as defense attorneys in knowing what prosecutors in Louisiana have promised the Grahams.

After all, as lead prosecutor in Collins's pending case in Houston, Cobe will have to contend with the Graham brothers' motivations, not to mention their credibility, when the former TDCJ director finally stands trial. Though the feds in New Orleans objected to having prosecutors deposed on the immunity issue, Cobe has so far supported the proceedings.

"I'm just trying to find out what [the agreement] is," Cobe says. "From what I understand, there isn't anything in writing, so I'm hoping these depositions will let us know."

At some point local law enforcement officers such as Cobe might have a real need to know the details of Mike and Pat's immunity arrangement. That's because, in addition to the recent criminal complaint filed by Fred Rizk, there is evidence of possible perjury and forgery committed by the Graham brothers in two state civil cases.

One revolves around Pat's agreement with the Louisiana Coushattas to build a golf course and hotel at the tribe's Grand Casino, near Kinder. When the Coushattas dropped the project, Pat filed a lawsuit, claiming the deal fell through because he had refused to pay kickbacks demanded by representatives of the tribe. Pat also produced a copy of the contract that stated all disputes between the parties would be settled by a Texas court. The tribe denied that and produced its own copy of the agreement, which clearly stipulated that the state of Louisiana had jurisdiction.

Before the case could go to trial, a document expert hired by the Coushattas filed an affidavit expressing the opinion that Pat's version of the contract was a fabrication. Apparently Pat had cut out the Coushatta's signature from the original contract and pasted it onto a modified copy. At a January 1999 hearing, Pat's son, an attorney (Pat himself was in jail on the tax charge), acknowledged the cut-and-paste job, but told the judge it was done with the tribe's permission. The judge threw the case out.

In documents filed with the court, the Coushatta attorney asked the judge to refer the matter to state and federal authorities for possible prosecution. U.S attorneys in Houston won't confirm or deny the existence of an investigation.

But in a December 7 letter to Gary Cobe, Jim Letten, the lead prosecutor in Louisiana, suggested that Pat Graham may already have immunity against the forgery allegation. That's because, at some point, Graham told prosecutors that a Coushatta representative had solicited a bribe from him. Letten told Cobe that based on "information supplied in part by Patrick Graham, as well as evidence gleaned from intercepted conversations by the FBI, an investigation is ongoing regarding the Coushatta Indian Tribe."

Did the Coushatta really try to bribe Pat Graham? Or did Pat just tell prosecutors that to prop up his bogus lawsuit? Whichever, the situation closely mirrors a dispute between Mike Graham and Fred Hofheinz in 1996 that immediately preceded the Graham brothers' decision to become government informants.

H<1>ofheinz first met the Grahams in 1992, when the brothers asked the former mayor to help them develop the youth correctional facility in Jena. Hofheinz formed Viewpoint Development Inc. and "hired" the Grahams as consultants. Later Viewpoint would bring in Professional Care of America, a company formed by Andy Collins, to operate the future facility.

A few months after Hofheinz became involved in the Jena project, Mike Graham was indicted for tax fraud. Unable to afford a lawyer, he asked to borrow $250,000 from Hofheinz for his legal fees. Hofheinz refused to lend the money but offered to use proceeds from his mother's trust to buy Mike's large house at 2214 Bluff Creek in Kingwood, with an option to purchase the furnishings for an additional $135,000. Mike agreed.

A little later Mike Graham pleaded guilty to tax evasion, and in June 1993 he was sentenced to six months of home confinement and three years' probation. Hofheinz was among those who urged the judge to go easy on Mike, asking the court in a letter to "consider all the good this man has done in his life."

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