Lee Zurik Investigation: New documents, more problems for Reed in hospital deal

File photo of Walter Reed
File photo of Walter Reed
A photo of Paul Cordes, who died in 2005 (Source: NOLA.com/Times-Picayune)
A photo of Paul Cordes, who died in 2005 (Source: NOLA.com/Times-Picayune)

New documents raise more questions about a statement issued by St. Tammany Parish District Attorney Walter Reed. The statement centers on an arrangement with St. Tammany Parish Hospital and money that Reed claimed personally.

For three straight years – 2009, 2010 and 2011 - board minutes list DA Walter Reed as 'present.' And at those same meetings, the board voted on legal fees for the upcoming year. In each case, hospital officials says they voted on a legal arrangement with the St. Tammany Parish DA's office.

But Walter Reed didn't deposit the money into the DA's account. He claimed it, personally.

"The records, the paper trail don't align with what Mr. Reed is alleging occurred," says Metropolitan Crime Commission president Rafael Goyeneche.

Reed says he kept the money because of a verbal agreement with a now-deceased board member. In a statement, Reed's spokesman said, "In the mid 90's... the then chairman of the St. Tammany Parish hospital board Paul Cordes approached Walter Reed and suggested that the board wanted Mr. Reed to personally perform legal representation services, instead of the personnel being provided at the time from the district attorney's office."

Paul Cordes, the former board chairman, passed away in 2005. Subsequent resolutions call Reed's statement into question - all the documents we received show the hospital's arrangement was with the DA's office, not Reed.

Goyeneche says, "If the board voted to hire the district attorney's office to provide legal services to the hospital, and the board chairman, after that vote, went to Walter Reed and said, 'Why don't you convert that to personal income,' then any good attorney would know that the resolution of the board would be controlling and not the verbal expressions of the chairman of the board – who, by the way, is now deceased."

The MCC head says the checks obtained by FOX 8 News and NOLA.com/The Times-Picayune show Reed deposited the money into the DA's office account until March 2007, when the canceled checks show a change – at that time, Reed started depositing the money into his personal account.

"You've got documents that seem to be adverse to the position that the DA is now claiming publicly in this," Goyeneche says.

If the money was in fact intended for the DA's office then, by our calculations, Reed could have kept as much as $217,500 meant for the public.

"I think his explanations ring hollow," Goyeneche tells us, "but that will be up to the authorities to make that determination."

Remember: When Reed didn't attend board meetings, he sent an assistant district attorney.

Goyeneche says that could spell even more problems. "When he didn't attend those meetings and he sent one of his staff members to sit in his place, unless he can show that he reimbursed that attorney for doing it in a private capacity, then he was doing it on the clock for the district attorney's office," he says. "So any way you slice it, I think that there are problems for Mr. Reed in all of this."

Those problems could be mounting with the release of these board minutes that, for at least three years, list Walter Reed as "present" when the board voted on attorney arrangements.

"The problem is, when you have a public official that puts their own personal interest above the public's, this is a byproduct of that," says Goyeneche.

Reed resigned as attorney for the hospital, saying he did so because this misunderstanding became apparent and not because of any misconduct.

Reed's campaign spokesman, Morgan Stewart, sent this response to our latest questions Monday evening:

We have not had access to documents in question that allegedly refute Mr. Reed's perspective on this matter.

Therefore these four points are what we know to be accurate: First, in the mid 1990's, then chairman of the St. Tammany Parish Hospital board Paul Cordes approached Walter Reed stating that the board wanted Mr. Reed to personally perform legal services for the hospital, instead of the personnel being provided at that time from the District Attorney's office.

Second, contrary to what has been asserted, it is not the form of the endorsement on the backs of a limited number of checks that matter, but the account number into which that check is deposited that reflects who is the actual recipient.

Third, all of the checks at issue were written to Walter Reed, not Walter Reed District Attorney or to the District Attorney of St. Tammany and Washington Parishes.

Fourth, there is no dispute that all checks at issue were deposited into Walter Reed's personal account and declared as personal income outside of his income as District Attorney.

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