For many months, this office, along with Public Integrity Section of the Department of Justice, the FBI and other federal law enforcement officials, and the Rhode Island State Police, has been actively engaged in a large and complex public corruption investigation into relationships between Rhode Island legislators and entities that have interests in legislation and activities of the General Assembly. To date, that investigation has yielded a number of convictions, one former state senator is in federal prison, and the Roger Williams Medical Center is operating under the terms of a deferred prosecution agreement.
We are here today to announce a major development in the investigation.
The United States has charged former House Majority Leader Gerard Martineau with two counts of honest services mail fraud for engaging in extensive and undisclosed personal business dealings with a pharmacy company and a health insurer and, in return, steering the outcome of legislation in which those companies were interested.
Martineau is alleged to have been paid more than $900,000 in the two schemes. A two-count information has been filed today in United States District Court here in Providence, along with a Plea Agreement under which Martineau agrees to waive
indictment and plead guilty to both charges. Each count carries a maximum penalty of five years’ imprisonment and a fine of $250,000 or twice the amount of gain or loss.
An information is merely an allegation and a defendant is presumed innocent unless and until proven guilty. Even though Martineau has signed an agreement to plead guilty, he has not yet entered a plea. He will have an opportunity to formally enter a plea at a federal court hearing that has not yet been scheduled.
In substance, here is what the information alleges. In 1998, Martineau formed a personal business entity called The Upland Group. In reality, this was not a “group” at all – it was just Martineau. Thereafter, he arranged to sell paper bags to the health insurance company, for use as promotional items, and both plastic and paper bags to the pharmacy company for use in its merchandising. In return, according to the information, he used his position to affect legislation that was important to the two companies.
Among the most important pieces of legislation was the so-called Pharmacy Freedom of Choice or Any Willing Provider legislation, which both companies opposed.