The Swan saga of official corruption, tax evasion and fraud could come to an end this June with the sentencings of former longtime Chelsea Selectwoman Carole Swan and her husband, contractor Marshall Swan.
Carole Swan, 55, is scheduled to be sentenced at 1 p.m. June 13 in Bangor for extorting money from Whitefield contractor Frank Monroe, defrauding the federal workers’ compensation program in 2008 and 2010, and filing five years’ worth of fraudulent tax returns.
The sentencing hearing is to be held in U.S. District Court in Bangor before Chief Judge John A. Woodcock Jr.
On Sept. 17, a jury in that court convicted Swan of three counts of extortion by a public official for seeking kickbacks on three separate dates from Monroe, who held a contract to plow Chelsea’s roads and provide sand. At that time, Swan was chairwoman of the Chelsea selectmen. Each count carries a maximum penalty of 20 years in prison and $250,000 in fines
A separate jury on July 26 found Swan guilty of two federal workers’ compensation fraud charges and five counts of falsifying income on five years’ worth of federal tax returns. She was cleared of two additional workers compensation charges and of fraud in connection with a 2007 Windsor Road culvert project, which was done by her husband and funded largely with federal money.
Each of the workers’ compensation fraud convictions carries a maximum penalty of five years in prison; and each the tax fraud conviction, a maximums of three years in prison.
Swan’s husband, Marshall Swan, 56, is to be sentenced 10 a.m. June 2 in federal court in Bangor for filing the same five years of fraudulent tax returns from 2007 to 2011. A jury found him guilty Oct. 2.
His defense attorney, Walter McKee, said Tuesday that it was too early to tell whether Marshall Swan will speak publicly at his sentencing hearing. He opted against testifying at his own trial.
Attorneys are still filing written material in connection with those sentencings, but the hearings themselves should help to close the books on a case that has infuriated and fascinated many people in Chelsea and elsewhere for the past several years.
The public became aware that something might be amiss on Feb. 10, 2011, when Carole Swan, who was then chairwoman of the selectmen, was arrested on state charges of aggravated forgery, theft and improper compensation for services. The charges stemmed from a sting set up by Kennebec County sheriff’s deputies after Monroe came to them on Jan. 31, 2011, and said Carole Swan was demanding a third kickback from him, saying that he held a lucrative contract with the town.
He testified at the second trial that he had given Carole Swan $3,000 in January 2010 and $7,000 in December that year, but had balked when she asked for $10,000 in January 2011. He said he had paid her with his own money in the first two instances, but he would not falsify a bill to the town for sand delivery in order to obtain the $10,000.
Swan testified at a hearing in September she had the first two payments totaling $10,000 in cash in her truck outside the courtroom, asking, “Do you want me to go out and get it?”
She received no reply.
Deputies recorded a number of phone calls between Monroe and Swan beginning Jan. 31, 2011, and photographed her four days later receiving a package from Monroe, her white pickup parked parallel to his dark sand truck on Chapel Street in Augusta.
Deputies David Bucknam and Ryan Reardon stopped Swan’s pickup about a block away and demanded she return the package. She then went to the Kennebec County Sheriff’s Office, where deputies questioned her for about 90 minutes on camera. At the time, she said she had accepted a number of bribes from different contractors and that it was a common practice. At the trial, Swan testified she had lied to the deputies and, in fact, was conducting her own investigation into Monroe.
The FBI joined the probe because Carole Swan was an elected town official. Agents took boxes of material from the Town Office, and municipal government operations almost ground to a halt because the town had only two selectmen, and Swan was banned from the Town Office as a condition of her bail.
Swan and her husband both were indicted on federal charges on March 1, 2012, and both formally denied any wrongdoing.
Then came a prolonged exchange of documents as the case was readied for trial, and a pretrial hearing at which Carole Swan astounded onlookers by testifying she could not read anything other than numbers.
The claim was hard to believe since she had graduated from Gardiner Area High School in 1976 and worked for the U.S. Postal Service as a rural mail carrier for a number of years. In fact, she was doing that job when she suffered a disabling injury to her shoulder that was the basis for her receiving $40,000 to $50,000 annually in federal workers’ compensation benefits.
In May 2010, Swan, in signing a statement to obtain those benefits, indicated she had no other income. “I do not work. I cannot work. I cannot even clean my own house or blow-dry my hair,” she wrote.
The prosecutor said Swan at the time was co-owner of the construction business, was paid by the town of Chelsea as selectman and assessor, and was the owner of a harness horse racing business run by her brother in Ohio.
During her trials, Swan testified that if she had violated any laws, it was unintentional and a result of three decades of domestic abuse at the hands of her husband.
The juries disagreed.
They also found she and Marshall Swan had failed to declare $640,000 in income in tax years 2006 through 2010 from Marshall Swan Construction, their earth-moving firm, and failed to pay some $145,000 in income and self-employment taxes due in those years, along with penalties and interest.
Marshall Swan’s attorney, McKee, said Tuesday, “The timing of the payment of the past due taxes is something we are working on right now.”
During Marshall Swan’s trial, McKee told jurors that his client relied on his wife to do all the bookkeeping for the firm.
Both Swans remain free on bail.
Carole Swan’s defense attorney, Leonard Sharon, has a March 13 deadline to file a brief regarding issues discussed at a presenting conference in a judge’s chambers on Monday, and the prosecutor, Assistant U.S. Attorney Donald Clark, must respond to that by March 20, according to a deadline set by Woodcock.
Clark filed a sentencing memo in early February saying that the Swans had retaliated against Monroe almost immediately after being indicted, sending men to damage Monroe’s work vehicles.
In a 36-page memo, Clark described a long list of lies, retaliation, witness tampering and other activities he says should be taken into account when the Swans are sentenced.
Neither Swan has a prior criminal record, although Marshall Swan was arrested in 2006 on a charge of domestic violence against his wife. The charge was dismissed later after he successfully completed a 12-month period of deferred disposition.
For more coverage on this story, visit our Carole Swan trial index.