FILE PHOTO: FORMER ALA. GOV. SIEGELMAN
Dave Martin  /  AP
Don Siegelman, shown in November 2002 when he was still governor of Alabama, is alleged to have conspired with two other people to manipulate a state maternity care contract.
updated 5/27/2004 4:24:16 PM ET 2004-05-27T20:24:16

Former Gov. Don Siegelman was indicted Thursday on federal charges that he took part in a bid-rigging scheme involving a state program to help poor, pregnant women while he was in office.

His former chief of staff, Paul Hamrick, and a political backer, Dr. Phillip Bobo, were also indicted.

Siegelman, a Democrat, denied the charges, which he called “Republican politics at its worst.”

Siegelman served a single four-year term before he was narrowly defeated for re-election in 2002 by Republican Bob Riley, who ran on a platform of ethics in government.

Siegelman and Hamrick were accused of moving $550,000 from the state education budget to the Alabama State Fire College, where Bobo was a director, so Bobo could offer the money to a competitor not to seek a federally funded contract to serve pregnant women.

The indictment also described a network of unnamed co-conspirators — lobbyists, lawyers, aides to Siegelman and others — who allegedly pressured state Medicaid officials to change rules and bid specifications to help Bobo’s company, Neighborhood Health Services.

Bobo’s company ultimately failed to win the contract. The company’s bid was more than $1 million higher than the only other bid, prosecutors said.

Siegelman claims innocence
Siegelman was not accused of personally profiting from the plot. Prosecutors said Bobo had contributed to Siegelman’s gubernatorial bid and was raising money for Siegelman’s campaign to establish a state lottery.

“As the facts come out, I will be proven innocent,” Siegelman said in a statement.

U.S. Attorney Alice Martin, a Republican appointee, denied that politics were involved. “We don’t ever look to see if there is an ‘R’ or a ‘D’ behind anyone’s name,” she said.

Bobo, 59; Siegelman, 58; and Hamrick, 40, were each charged with conspiracy and fraud. Bobo also was charged with witness tampering, lying to the FBI and perjury.

The fraud counts carry the most serious penalties, up to 10 years in prison and $250,000 in fines. The other charges are each punishable by up to five years and $250,000 in fines.

The charges stemmed from an earlier investigation that led to charges against Bobo for committing fraud while trying to secure a contract for providing maternity services to Medicaid recipients. Bobo was convicted in 2001, but the conviction was thrown out by a federal appeals court.

The defendants’ lawyers will arrange with prosecutors for the men’s surrender.

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