Gov. Larry Hogan is expected to be called as a witness in the federal trial of a former chief of staff facing charges of wire fraud, embezzlement and falsifying a memo that included Hogan’s approval of an unprecedented $233,647 severance payment when he left another state agency to become the governor’s top adviser.
Roy McGrath is charged in both state and federal courts for allegedly collecting excessive expenses while he served as director of the Maryland Environmental Service and for arranging the severance payment as he transitioned from that role to Hogan’s top adviser in spring 2020.
Hogan, who has said he did not approve the severance payment, will be called to testify during the trial scheduled to begin Oct. 24, according to a joint filing late Tuesday from prosecutors and the defense.
The filing, outlining a set of questions that will be used in jury selection, does not include a full list of witnesses. But multiple questions are intended to eliminate potential jurors who believe they would not be fair or impartial because of Hogan’s testimony.
“Would you give more or less weight to the testimony of Mr. Hogan merely because he is the Governor of the State of Maryland?” one of the questions reads.
McGrath spent 11 weeks as Hogan’s chief of staff before news of the payments came to light and he resigned in August 2020.
He pleaded not guilty last fall to the original slate of federal charges of wire fraud and misappropriation.
One additional wire fraud charge — regarding a memo that included Hogan’s approval of the severance payment but that prosecutors say McGrath fabricated — was added in June. Joe Murtha, McGrath’s attorney, said at the time that McGrath “firmly stands by the fact that Governor Hogan formally approved of his compensation from Maryland Environmental Service, and sadly, turned his back on Mr. McGrath to avoid the political fallout of his decision.”
The memo was discussed publicly after the initial reports of McGrath’s misconduct in 2020, and a copy of it was included in an 82-page report the General Assembly made public earlier this year after its members conducted their own investigation.
The allegedly falsified memo, prosecutors say, contained a blue check mark typically used by the governor that “created the illusion that the Governor had seen and approved the memorandum.”
Prosecutors, meanwhile, have also made recent requests that phone calls involving Hogan and other high-ranking Maryland officials that McGrath allegedly recorded in secret should not be admissible as evidence.
Recording someone without their consent is a felony under Maryland state law but not federal law.
The state charges, which are scheduled for trial next year, involve nine phone calls McGrath illegally recorded while still at MES, and one he recorded the day he resigned from Hogan’s office in August 2020.
In a recent court filing, federal prosecutors said only the call recorded on the day of McGrath’s resignation should be allowed to be played as evidence in the upcoming trial.
The content of the other calls, some of which involved Hogan as the administration dealt with the outset of the COVID-19 pandemic, are “irrelevant to the federal charges” and will add confusion to the government’s case, they wrote.
“This is a trial about Defendant’s actions while at MES and after joining the Governor’s Office as the Governor’s Chief of Staff and not about the Coronavirus Response Team,” federal prosecutors wrote. “Allowing the jury to hear these conversations or confronting witnesses with snippets of those conversations will confuse the issues and mislead the jury.”
The Aug. 17, 2020 call, however, includes statements McGrath made in response to The Baltimore Sun’s story two days earlier that broke the news of his severance payment, prosecutors say.
That call involved Hogan’s top counsel, legislative officer, a senior adviser and two political consultants, according to court documents.
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Murtha, in a filing Tuesday, argued the phone calls from earlier in 2020 should be allowed as evidence. He argued that recording the calls was not a violation of federal law, and the trial on the state charges has not yet occurred. The “discussions about the COVID-19 pandemic response” depicted in the recordings are “a matter which was of the utmost concern to the welfare of all” Maryland residents, he wrote.
The government’s request to limit the phone calls used as evidence is among several requests both sides have presented in recent weeks as they prepare for trial.
The defendant has asked the federal judge to bar any evidence that shows McGrath is also the subject of a state investigation and that the Maryland General Assembly concluded its own investigation earlier this year. While McGrath’s attorney argues those parallel probes are irrelevant and unnecessary to bring into the federal case, federal prosecutors say the legislative hearings and state investigation are “essential evidence in the timeline of charges” in their case.
Another request by prosecutors would allow them to use texts that McGrath’s girlfriend — now wife — sent while they were vacationing in Italy and Naples, Florida in 2019 during periods in which McGrath allegedly was paid to be working.
While at MES, McGrath incurred at least $169,000 in expenses that included frequent out-of-state trips, according to the legislative report released in May. He also surrounded himself with loyalists who McGrath directed to donate to Hogan’s campaigns, the report stated.
U.S. District Judge Deborah L. Boardman, after the trial had originally been set for this past June, scheduled it to begin Oct. 24, with a pretrial conference scheduled for Tuesday.