Pittsburg politician jailed for running gambling businesses

Former two-term South Pittsburg mayor Mike Killian (56) was in the local news media headlines Friday after being sentenced to six months in federal prison followed by one year of house arrest and a $30,000 fine for running an illegal gambling operation.

The former mayor pleaded guilty to a single count, but claimed he was the victim of political opponents; that his activities were probably exposed by integrity enquiries connected with his brother Bill’s nomination for U.S. attorney for the Eastern District of Tennessee; and that he was not the only one to run similar enterprises.

Killian’s primary business is in fireworks, but he ran a number of sidelines over the past 25 years involving gambling – part of the time whilst he was in public office – although he claimed that he kept his public and private professional lives apart.

Prosecutors said they found no evidence that he used his office to further his gambling businesses.

Those gambling sidelines included running an “outlaw lottery” operation from 1988 until 2012; a sports betting operation since 2002 and video gaming machines since 2004. He also acknowledged starting an offshore, online betting website in late 2012.

Prosecutors estimate that Killian made at least $400,000 from the lottery, sports betting and gaming machines during the time period, and court documents claim that the sports betting took in between $8 million and $12 million in wagers over its decade of operation, a number that Killian disputes.

The Times Free Press reports that during the hearing Killian admitted that his gambling operations had “got out of hand”, and he apologised to both his family and Pittsburg residents.

“I especially did wrong to engage in that while I was holding public office,” he said. “And one or the other should have stopped.”

Killian said that he has since learned that investigations into his activities by the Department of Justice had been in progress for two years before his gambling operations were raided in January 2013, when a dozen video gaming machines and $38,475 cash was seized.

Documents show that the U.S. Attorney’s Office for the Eastern District of Tennessee recused itself from any dealings in Killian’s case, leaving the Department of Justice’s public integrity section to pursue Killian.

Claiming that there may have been political motives involved in his prosecution, Killian said that many questions federal prosecutors asked him, “…were right out of the mouths of my political opponents.”

Federal prosecutor Mark Angehr argued that Killian should be sentenced in the range of one year to 18 months set out in the charge, saying:

“The brazenness of this long-running illegal, criminal business is shocking.”

Killian’s legal representative suggested that his client should receive probation and that since there were no ties between the gambling and his position as mayor, he shouldn’t be punished any more than others facing the same charge.

Similar cases in the district had nearly all resulted in terms of probation, not prison, he claimed.

A co-defendant in the case, Robert Barry Cole (53) was also sentenced; he will serve three months in prison and six months on house arrest.