A Louis Vuitton handbag valued at $3,400. Some $10,000 in bitcoin. Travel to cryptocurrency conferences and a payment of $1,500 for rent.
That’s what the owner of a company that was trying to gain traction last year at the Development Authority of Fulton County (DAFC) claims she provided to one of its board members -- JoAnna Potts. In exchange, Potts was supposed to help Waterford Logistics create a business plan and obtain financing from the government agency to help fund the company’s new venture.
Now the propriety of those gifts and payments are detailed in a new 112-page report by an outside law firm hired by the DAFC to review the transactions and the entreaties Potts made with the company.
The report does not make any determination about potential illegal conduct, but said Potts violated authority, county and state ethics rules, and the authority had cause to remove or suspend her from the board. Potts resigned Feb. 15, a week before the board received the report. Following an executive session, the DAFC board voted unanimously Feb. 22 to send the report to law enforcement.
The findings are the latest scandal for an agency that was rocked last year following an investigation by The Atlanta Journal-Constitution and Channel 2 Action News that uncovered a culture of loose financial oversight under former authority leadership.
The Waterford Logistics venture — a cryptocurrency mining operation — never made it before the DAFC board for consideration, according to the report, and it appears no public funds or services went to the proposed bitcoin farm. DAFC learned of allegations against Potts in October and hired an outside law firm, Andersen Tate & Carr, to investigate.
The businesswoman, Judith Richards, who owns Waterford Logistics, denied to the AJC that she was involved in a pay-to-play scheme, but instead said she is the victim of a fraud.
Richards said she thought she could do business with Potts independent of her DAFC service. Richards claims Potts injected her role at DAFC in their work.
“I cannot imagine that your project will be ready for DAFC any sooner than a very fair estimate of 90 days,” Potts told Richards in an August text message. “… After that I imagine your funding will be available after the first of the year.”
Richards said she thought the gifts and benefits given to Potts were permissible so long as the business relationship was disclosed by Potts to the DAFC board. That disclosure never happened.
“What we were expecting was that JoAnna was going to help Waterford Logistics put together … basically a full business plan, a whole package, to bring forth to the development authority so they could review it and see if we qualified for bond financing,” Richards said.
Credit: J. Scott Trubey
Credit: J. Scott Trubey
Richards also alleges she was induced by Potts to pay an associate, a man identified as Charles Aiken of Houston, Texas, $75,000 in bitcoin for consulting work and help to obtain financing that never materialized.
But Richards said she learned in September through DAFC records her bitcoin project did not go before the board for consideration.
Richards said she is out $100,000 and wants to be repaid by DAFC, but legal experts said the authority likely has no liability in this dispute.
Potts did not respond to email messages left for her since Friday. Attempts to contact Aiken were not successful.
Richards and an associate, Dominique Huff, in October filed and later retracted ethics complaints against Potts, which triggered the DAFC investigation.
Potts denied any wrongdoing to DAFC’s lawyers. In a statement included in the report, Potts called Richards’ allegations “slanderous.”
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Credit: undefined
According to the report, Potts said the compensation she received was for work she did for Waterford Logistics.
Potts said Waterford did not formally apply for assistance from DAFC and she wasn’t required to disclose the business relationship. If Richards or the company had sought assistance from DAFC, she would have disclosed her business relationship to the authority and recused herself from any votes as required under DAFC’s ethics guidelines.
Potts was appointed by Commissioner Khadijah Abdur-Rahman last year and joined DAFC on June 1, the same day the AJC published its first story about questionable per diems paid to former board Chairman Bob Shaw and two other officers. Potts was among a group of board members who called for a forensic audit of the agency in one of her first appearances as a director.
In a statement, Abdur-Rahman erroneously said the law firm’s report concluded no illegal activity by Potts.
“Quite frankly, ‘there is nothing to see here,’” Abdur-Rahman said. “However, I am not lost on the fact that we are in a political season, and it appears that politics may be at play.”
William Perry, who leads Georgia Ethics Watchdogs, said the conduct outlined by the firm’s report defies belief.
“This is just shocking,” he said.
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Credit: undefined
DAFC Chairman Michel “Marty” Turpeau IV said the authority engaged the outside counsel when it learned of the allegations and sent the report to Fulton County District Attorney Fani Willis’ office.
“In addition to fully cooperating with the initial investigation, I remain committed to assist with any further inquiries from law enforcement,” Turpeau said.
A spokesman for Willis did not return messages seeking comment.
DAFC’s outside lawyers said they made no determination in the report whether Potts’ alleged actions amount to criminal conduct, “in part because there is no evidence that she took any official action in her capacity” on the board.
‘Street of Dreams’
Potts’ actions with Waterford Logistics weren’t the only conduct referenced in the DAFC investigation.
In July, Potts pitched developers and local politicians during a bus tour on a speculative development project she envisioned called the Campbellton Road Street of Dreams.
In a video, according to the report, Potts identifies herself as a DAFC member.
“I will outreach to y’all and let y’all know how y’all can make money,” Potts is quoted as saying. “I will not be making any money over there, but I’m not gonna stop making my money. Do you hear me? Are we cool, commissioners? Are we cool, councilwoman? Everybody said I’m good. Alright.
“I would not – I promise y’all I will not get in the paper,” she said. “But I’m not gonna let y’all get business and Maseratis and then I don’t get mine, too. You can take that to the bank.”
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Credit: undefined
Huff, who runs a nonprofit that organized the tour, said he felt uncomfortable with Potts injecting her position on the DAFC board into her pitch for a development project.
Huff said he and Richards gave Potts the Louis Vuitton handbag as a birthday gift and out of appreciation for Potts’ efforts to revitalize southwest Atlanta.
On Tuesday, Huff said he recognized the purse could be an ethics violation.
“She got that bag, we can’t deny it,” he said. “We thought JoAnna disclosed that purse.”
In her Feb. 15 resignation letter, Potts did not reference the DAFC probe. She said she was in the process of incorporating a business and registering as a state and federal lobbyist. She suggested she was not finished doing business with the board.
“I intend (to) become a worthy applicant in my own right with some exciting projects in the hopper that meet DAFC goals,” she wrote. “I hope to continue to work with DAFC in any capacity where I may be of service and welcome any call.”
“… I don’t want anything that I do in my personal work to be misinterpreted or to become a distraction from the Board’s awesome progress forward,” Potts wrote.
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