phoenix solutions

Casada campaign literature hits mailboxes in Williamson County

Early voting for primaries in local races is nine days away, so voters’ mailboxes are getting inundated with campaign literature. In Williamson County, that includes a glossy item from state Rep. Glen Casada (R-Franklin), who is running for clerk.

Needless to say, the mailer makes no mention of Casada’s spectacular fall from the House speakership in 2019, or the ongoing federal probe into a shadowy mail vendor. Former Rep. Robin Smith (R-Hixson) in her recent guilty plea said she, Casada, and his onetime chief of staff Cade Cothren were secretly involved in establishing and promoting a company called Phoenix Solutions that landed business from the General Assembly and lawmakers.

Casada’s mailer features photos of his children and grandchildren. He touts his membership in the Brentwood Baptist Church and says he “started two successful small businesses.”

We assume the latter isn’t referring to Phoenix Solutions.

New TNJ alert: Awaiting more Phoenix fallout after grand jury testimony, lawmakers at odds over Ford labor disclosure rules, Lee declines to sign

Reps. Robin Smith (R-Hixson) and Mark Cochran (R-Englewood) are sworn into the 112th General Assembly on Jan. 12, 2021. (Erik Schelzig, Tennessee Journal)

The new print edition of The Tennessee Journal is out. Here is what’s in it:

— Waiting for the other shoe to drop after lawmakers’ grand jury testimony.

— Domed of Doomed? Lee’s $500 million bond proposal for new NFL stadium gets mixed reviews among lawmakers.

— Legislative roundup: Fracas over union labor building Ford plant, Lee doesn’t sign new sterilizer rules, and Jerry Sexton’s latest official Bible resolution appears headed for failure (again).

— From the campaign trail: 5th District race cast into uncertainty over residency requirement bill, lawsuit.

Also: Hagerty’s kids get stake in MLS team, Bell’s statue of limitations on smoking something in high school, and Weaver claims to title of “conscience of the House.”

As always, access the your copy of the TNJ here.

Or subscribe here.

House members subpoenaed in federal probe of shadowy vendor

Cade Cothren, speaking on phone, attends a meeting with lawmakers and fellow staffers on the balcony ouside the House chamber on April 29, 2019. (Erik Schelzig, Tenenssee Journal)

House Speaker Cameron Sexton (R-Crossville) is among lawmakers subpoenaed to testify before a federal grand jury about a shadowy campaign vendor linked to former Speaker Glen Casada (R-Franklin) and his onetime chief of staff, Cade Cothren.

“We have been fully cooperating with the federal authorities since I became speaker in 2019,” Sexton said in a statement. “It is not unexpected that I and other members would be called to appear before a grand jury to provide factual statements as part of this ongoing investigation.”

The subpoenas, which were first reported by WTVF-TV’s Phil Williams, follow a guilty plea by former Rep. Robin Smith (R-Hixson) earlier this month in which she admitted participating in a scheme to hide who was behind the vendor called Phoenix Solutions. The charging document makes thinly veiled references to Casada and Cothren being the other participants.

Smith has agreed to cooperate with the ongoing investigation as part of her plea agreement.

Registry refers Casada, Cothren probes to Williamson County prosecutor

Registry member Tom Lawless and then-Rep. Robin Smith (R-Hixson) confer on the House floor before Gov. Bill Lee’s State of the State address on Jan. 31, 2022. (Erik Schelzig, Tennessee Journal)

The Tennessee Registry of Election Finance is referring its investigations into former House Speaker Glen Casada (R-Franklin) and his onetime chief of staff, Cade Cothren, to Williamson County prosecutors.

The move comes after former Rep. Robin Smith (R-Hixson) pleaded guilty last week to a federal wire fraud charge over the creation of a front company called Phoenix Solutions, which obtained contracts to design, print, and send political mailers on behalf of Republican lawmakers.

Smith’s charging document made thinly-veiled references to Casada and Cothren, alleging they were heavily involved in the scheme.

The motion by Registry member Tom Lawless also sends prosecutors the case of the Faith Family Freedom Fund. The PAC’s treasurer testified to the panel in January that she had founded it at the behest of Cothren and had no further role in its activities. The outfit proceeded to lob attacks at then-Rep. Rick Tillis (R-Lewisburg) in his unsuccessful re-election bid in 2020.

Registry member Tom Lawless made the motion to involve Williamson County prosecutors, arguing it would be the appropriate venue because it covers Casada home area. He also raised concerns the issue could be “weaponized” amid a contested Democratic primary for Nashville district attorney. It’s unclear whether Williamson County DA Kim Helper will recuse herself from the case.

Whoever signed this Phoenix Solutions document has some explaining to do

Phoenix Solutions W-9 form filed with the Tennessee General Assembly.

According to federal prosecutors, Matthew Phoenix, the purported proprietor of political vendor Phoenix Solutions, was not a real person. They say it was actually Cade Cothren, a onetime chief of staff to then-House Speaker Glen Casada (R-Franklin). Cothren allegedly posed as Matthew Phoenix because he knew the company wouldn’t otherwise get approval to do work on taxpayer-funded constituent mailers from the General Assembly.

Rep. Robin Smith (R-Hixson) is scheduled to strike a plea deal with the U.S. Attorney’s Office in federal court on Tuesday afternoon. Smith, who resigned from the House on Monday, was aware of Cothren was posing as Phoenix, according to the charging document.

An IRS W-9 form submitted to the General Assembly in January 2020 carries the signature of Matthew Phoenix, right under a section outlining the certification is made “under penalties of perjury” that the person singing the document is a “U.S. person.”

UPDATE: Smith strikes plea agreement with feds

Freshman Rep. Robin Smith (R-Hixson) attends a House floor session in Nashville on April 23, 2019. (Erik Schelzig, Tennessee Journal)

State Rep. Robin Smith (R-Hixson) has struck a plea agreement with federal prosecutors over a kickback scheme related to a political vendor called Phoenix Solutions, according to court records.

“Ms. Smith submits that the parties have reached a plea agreement to resolve the pending charges in this case and that she is ready to change her plea in this matter,” according to a filing on Smith’s behalf on Monday afternoon.

A hearing on the matter has been scheduled for Tuesday at 4:30 p.m. Central in Nashville.

Earlier Monday, federal prosecutors made charges agaisnt Smith public alleging she was was joined by two unnamed individuals who are nonetheless easily identified as former House Speaker Glen Casada (R-Franklin) and his onetime chief of staff Cade Cothren.

Smith, a former state Republican Party chair, resigned from the House after being charged.

“I want you to know that serving the great people of this district, and indeed, all of Tennessee, has truly been an honor,” Smith wrote in her letter to House Speaker Cameron Sexton (R-Crossville) “I have resigned with the deepest of humility and out of respect for the role of public service.”

Correction: An earlier version of this post mistakenly referred to an indictment. The charging document was filed as an information.

Read the full charges here:

THE UNITED STATES CHARGES:

BACKGROUND ALLEGATIONS

At all times material to this Information unless otherwise indicated:

1. Defendant ROBIN SMITH was a member of the Tennessee House of Representatives (“Tennessee House”), representing District 26, which included part of Hamilton County, Tennessee. SMITH was first elected to the Tennessee House in or around November 2018. SMITH also owned and operated a political consulting company called Company I. Company 1 provided political consulting, mail, and project management services.

2. Individual 1 was a member of the Tennessee House, first elected in 2003. Individual I served as Speaker of the Tennessee House from in or around January 2019 until in or around August 2019. In or around August 2019, Individual 1 resigned as Speaker after a scandal became public. Individual 1 also owned and operated a political consulting company called Company 2. Individual 1 started Company 2 in or around October 2019 to provide fundraising services to Political Party 1 lawmakers.

3. Individual 2 was a businessman and former Chief of Staff to Individual 1 when Individual 1 was Tennessee House Speaker. In 2019, multiple news forums published allegations that Individual 2 had committed inappropriate and illegal conduct. Based on public reporting, Individual 2 admitted certain allegations, and, on or about May 3, 2019, Individual 2 resigned his position as Chief of Staff.

4. The State of Tennessee (“the State”) allocated Tennessee Representatives $3,000 annually to fund postage and printing of items to be sent to the legislators’ constituents (“the Mailer Program”). According to Tennessee House guidelines, Representatives were permitted to use Mailer Program funds to design and mail “legislative update mailers” and legislative surveys to their constituents. Representatives were permitted to use campaign funds to offset additional expenses beyond the $3,000 allocated under the Mailer Program.

5. The Tennessee House Speaker’s Office had the authority to approve or deny a vendor to provide services or any mailing funded by the Mailer Program.

6. In or around November 2019, Individual 2 established Phoenix Solutions, LLC. Phoenix Solutions was established, with SMITH and Individual l’s knowledge and support, for the purpose of offering mail and consulting services for legislative members facing primary challengers, and was later expanded to offer constituent mail services to members of the Tennessee General Assembly. SMITH, Individual 1, and Individual 2 told others, including members of the Tennessee General Assembly and the House Speaker’s Office, that Phoenix Solutions was run by an individual named “Matthew Phoenix.” SMITH, Individual 1, and Individual 2 claimed that Matthew Phoenix was an experienced political consultant who had worked for Consulting Firm 1, a real company based in Washington, D.C. In truth and in fact, Individual 2 ran Phoenix Solutions and SMITH, Individual 1, and Individual 2 profited from it.

7. SMITH, Individual 1, and Individual 2 knew that Matthew Phoenix was a fictitious person and was, in truth and in fact, Individual 2.

8.SMITH, Individual I, and Individual 2 concealed Individual 2’s involvement in Phoenix Solutions from the State and members of the Tennessee General Assembly due to the expectation that Phoenix Solutions would not be approved by the Tennessee House Speaker’s Office, acting on behalf of the State, or hired as a vendor by individual members if Individual 2′ s involvement was disclosed. SMITH, Individual 1, and Individual 2 also concealed the fact that Individual 2 kicked back a portion of the profits from the State and members of the Tennessee General Assembly to SMITH and Individual 1 due to the expectation that Phoenix Solutions would not be approved by the Tennessee House Speaker’s Office, acting on behalf of the State, or hired as a vendor by individual members Individual 2’s operational involvement and financial interests in the business and the kickbacks to SMITH and Individual 1 were disclosed.

9. SMITH and Individual 1 received kickbacks from Individual 2 in exchange for using their positions as members of the Tennessee House of Representatives to perform official acts, including pressuring the Tennessee House Speaker’s Office to approve Phoenix Solutions as a Mailer Program vendor and disburse State funds to Phoenix Solutions.

10. Individual 2, with SMITH and Individual’s knowledge and support, set up an email account for Matthew Phoenix, matthew@powerofphoenix.com, which Individual 2 used to conduct business on behalf of Phoenix Solutions.

11. Individual 2 incorporated Phoenix Solutions as a limited liability company (LLC) in New Mexico. Individual 2 set up a United States Postal Service post office box for Phoenix Solutions there and forwarded the mail received by that post office box to his home address in Nashville. Individual 2 later explained to SMITH that he established the post office box in New Mexico because that state allows the anonymous registration of LLCs.

12. In or around January 2020, SMITH was informed by an employee of the Tennessee House Speaker’s Office that the Speaker’s Office needed to work directly with the third-party vendor, which was a change in the existing guidelines employed by legislative members for constituent mail. SMITH informed Individual 2 of this fact. Individual 2 was notified that the State could not pay Phoenix Solutions without an Internal Revenue Service Form W-9 on file. In response, Individual 2, assuming the identity of Matthew Phoenix to disguise his true identity, sent a W-9 signed by “Matthew Phoenix” from the matthew@powerofphoenix.com email address to the Tennessee House Majority Caucus Advisor for the purpose of filing it with the State.

13. On or about December 18, 2019, SMITH emailed Individual 2. Referencing a potential future conversation related to Phoenix Solutions with a Political Patty 1 employee regarding a campaign mailing list that each incumbent legislative member was to receive, SMITH told Individual 2 that he “may have to assume the role of Matthew again.” Individual 2 replied to SMITH, “Matthew, reporting for duty!” and included a graphic interchange format (“.gif”) picture of a salute from Harrison Ford’s character Han Solo in the movie Star Wars.

14. On or about January 24, 2020, SMITH emailed Individual 2, writing, “We’ll start with this…Matthew…you might expect some type of call, email.” Below, SMITH copied an email chain between SMITH, the Acting Chief of Staff to the House Speaker, and the General Assembly’s Director of Legislation. In the email chain, SMITH asked the officials about the status of Mailer Program payments to Phoenix Solutions and why there was an issue with processing them. The Acting Chief of Staff wrote SMITH, “I’m on it.” SMITH replied, “Don’t crush her, but [the Director of Legislation has] been telling this vendor that the check’s on the way for about two weeks.” SMITH falsely added, “It’s guys from [Consulting Firm 1] who did mail two years ago that left and started their own gig…tired of doing the DC/Trump stuff. Thanks.” SMITH then forwarded the email chain to Individual 2, adding the message, “Shhhhhhhhhh.”

15. Individual 3 was Individual 2’s girlfriend. At times, Individual 3 assumed the fictitious role of “Candice,” another alleged employee of Phoenix Solutions.

16. On or about June 16, 2020, Individual 3 and Individual 2 emailed each other as “Candice” and “Matthew.” The purpose of the email exchange was to falsely make it appear as if two employees of Phoenix Solutions were having an exchange about the need to secure payment on outstanding Mailer Program invoices that the State had not yet paid. Individual 2, using the matthew@powerofphoenix.com email account, then forwarded the exchange to SMITH.

17. On or about June 22, 2020, SMITH emailed the General Assembly’s Director of Legislation, copying the Acting Chief of Staff to the House Speaker, to complain about delays in Mailer Program payments from the State to Phoenix Solutions. SMITH forwarded them the June 16, 2020, email exchange between “Candice” and “Matthew” complaining about the delayed payments. Above that email chain, SMITH wrote, “[Director of Legislation], I was cc’d on this last week. … It would be either illegal or unethical to move to print without knowing payment was coming, so the bulk permit number is provided on the invoice. Simpler, asking a firm to be liable for the cost with the printing completed before knowing payment may or may not be approved is suspect. Is there something going on?” Enclosed within SMITH’s email were invoices from Phoenix Solutions for legislative mailers on behalf of two Representatives, for $4,547.50 and $5,537.

18. On or about May 20, 2020, SMITH discussed Phoenix Solutions with a member of the Tennessee House Political Party 1 caucus. SMITH described Phoenix Solutions as her preferred survey mailer company. SMITH falsely said that Phoenix Solutions was owned and operated by Matthew Phoenix, an experienced political consultant with whom SMITH did business when SMITH used Washington, D.C.-based Consulting Firm I for political work. SMITH falsely said that Matthew Phoenix and his associate, Candice, got tired of living in the Washington, D.C. area and decided to move back home to New Mexico, where Phoenix started Phoenix Solutions. SMITH falsely said that she used Phoenix Solutions because of the quality of its work.

19. On or about August 10, 2020, SMITH attended a meeting of the Political Party 1 House campaign committee. Present at the meeting were several Tennessee Representatives, officials from the Speaker’s Office, and a committee consultant. SMITH repeated the same false statements regarding Phoenix Solutions that she had made to the caucus member on or about May 20, 2020. She also falsely told the committee members that she did not make any money from Phoenix Solutions.

20. On or about April 2, 2020, Individual 2 sent an email to SMITH and Individual 1. The email stated, “Friends, Here’s our up-to-date printing spreadsheet. All of these checks have been collected and deposited. All bills related to these print jobs have also been paid. So, let me know what address is best for you and I will cut checks for each of you?” Individual 2 provided a breakdown of total profit earned from each client. SMITH, Individual 1, and Individual 2 shared the profits, with Individual 2 earning 30%. Individual 1 and SMITH each earned $4,143.64, which was 25% of the business, each. Individual 2 wrote that the remaining 20% of the profit was “left in business.” Individual 2 also discussed ways to cut Phoenix Solutions’ future costs.

21. From on or about June I, 2020, through on or about December 1, 2020, Phoenix Solutions took on more varied projects, but continued to receive payments from the State-funded Mailer Program and campaign accounts of members of the General Assembly. During that timeframe, a Phoenix Solutions bank account ending in x3886 received revenue of approximately $158,165, excluding payments from campaign accounts associated with SMITH and Individual 2. From on or about January 1, 2020, through on or about December 31, 2020, Phoenix Solutions, Company 1, and Company 2 received approximately $51,947 from the State in payments associated with the Mailer Program.

22. On or about September 10, 2020, SMITH endorsed and deposited check number 152, dated September I, 2020, in the amount of $12,003.16, from Phoenix Solutions’ account number x3886 into a bank account associated with her consulting firm, Company 1. Individual 2 signed the check in his given name and wrote “Consulting” on the memo line.

23. On or about December 17, 2020, SMITH endorsed and deposited check number 170, dated December 16, 2020, in the amount of $12,116.96, from Phoenix Solutions’ account number x3886 into a bank account associated with Company 1. Individual 2 signed the check in his given name and wrote “Consulting” on the memo line.

COUNT ONE
18 u.s.c. §§ 1343, 1346
(Honest Services Wire Fraud)

24. Paragraphs 1 through 23 are incorporated and realleged as if fully set forth herein.

25. Beginning in or around November 2019 and continuing until in or around January 2021, in the Middle District of Tennessee and elsewhere, the Defendant, ROBIN SMITH, aided and abetted by others, including Individual 1 and Individual 2, devised and intended to devise a scheme and artifice to defraud and deprive the citizens of the Middle District of Tennessee and the government of Tennessee of their right to the honest services of a public official, namely the honest services of SMITH and Individual 1, members of the Tennessee House of Representatives, through kickbacks.

26. In the Middle District of Tennessee and elsewhere, SMITH, aided and abetted by others, including Individual 1 and Individual 2, having devised and intended to devise the above­ described scheme, and for the purpose of executing the scheme, transmitted and caused to be transmitted by means of wire communication in interstate commerce, writings, signs, signals, pictures, and sounds.

All in violation of Title 18, United States Code, Sections 1343, 1346, and 2.

FORFEITURE ALLEGATION

1. The allegations contained in this Information are re-alleged and incorporated by reference as if fully set forth in support of this forfeiture.

2. Upon conviction of Count One of this Information, the defendant, ROBIN SMITH, shall forfeit to the United States, pursuant to Title 18, United States Code, Section 981(a)(l)(C), by Title 28, United States Code, Section 2461, any property, real or personal, which constitutes or is derived from proceeds traceable to the offense, including but not limited to a money judgment in an amount to be determined representing the value of the proceeds of the offense.

3. If any of the property described above, as a result of any act or omission of SMITH:

a. cannot be located upon the exercise of due diligence;

b. has been transferred or sold to, or deposited with, a third party;

c. has been placed beyond the jurisdiction of the Court;

d. has been substantially diminished in value; or

e. has been commingled with other property that cannot be divided without difficulty, the United States shall be entitled to forfeiture of substitute property, and it is the intent of the United States, pursuant to Title 21, United States Code, Section 853(p), as incorporated by reference in Title 28, United States Code, Section 2461(c), to seek forfeiture of any other prope1iy of SMITH up to the value of the property listed above as being subject to forfeiture.

Mark H. Wildasin

United States Attorney

Middle District of Tennessee

Ex-girlfriend testifies Cothren had her register PAC that attacked Casada foe Tillis

Cade Cothren, speaking on phone, attends a meeting with lawmakers and fellow staffers on the balcony ouside the House chamber on April 29, 2019. (Erik Schelzig, Tenenssee Journal)

In remarkable sworn testimony to the Tennessee Registry of Election Finance on Thursday, the treasurer of a mysterious political action committee testified she had registered the outfit at the behest of her then-boyfriend, Cade Cothren, and had nothing further to do with it thereafter.

“I asked him if it was illegal to open it for him,” said Sydney Friedopfer, a former Vanderbilt student who now lives in Utah. “And he said no. And he said he just couldn’t have a name on it, considering everything he had gone through.”

The Family Faith Freedom Fund PAC was involved in attacking then-Rep. Rick Tillis (R-Lewisburg), a foe of Cothren and his former boss, House Speaker Glen Casada, in the 2020 primary won by now-Rep. Todd Warner. (Just as a reminder, Cothren, Casada, Warner, and Rep. Robin Smith had their homes and offices searched by the FBI around this time last year).

Here is a transcript of Friedopfer’s testimony to the Registry on Thursday. The other speakers are Registry chair Paige Burcham Dennis, general counsel Lauren Topping, executive director Bill Young, and members Tom Lawless, David Golden, and Hank Fincher.

Paige Burcham Dennis: Miss Sydney, are you on the phone today?

Sydney Friedopfer: Yes, I am.

Paige Burcham Dennis: OK, before we get to you. I want to remind you, we’re going to have Lauren, give us a little bit of background on the Faith Family Freedom Fund case. But I do want to remind you that you are under oath today even though you’re participating by phone.

Sydney Friedopfer: OK, yep, no problem.

Paige Burcham Dennis: OK. Lauren, can you give the Registry a little bit of background on what’s going on with the Faith Family Freedom Fund case?

Lauren Topping: So as you’ll recall, this case came about as a result of a complaint that was filed with the Registry. As a result of that, there was an audit that was ordered. Up until this point in time, we had been unable to reach Ms. Friedopfer. And so the audit report basically says that we were unable to obtain any information. I think that’s all in your packet. But since then, we have been able to contact her and so she is here on the line today to tell you what she knows. So that’s kind of where we are.

Paige Burcham Dennis: OK, so at this time, Sydney, I understand you’re in Utah. Is that correct?

Sydney Friedopfer: Yes, that’s correct.

Paige Burcham Dennis: OK. I’m Chairman Burcham Dennis, and we’re going to let you tell us what you would like to tell us concerning the case.

Sydney Friedopfer: OK. So I guess I don’t have the exact date, sometime in end of 2019, early 2020. I had a friend of mine that I met when I was back at Vanderbilt ask me to open a political action committee for him. I was advised that I should tell you the name. The name is Cade Cothren. And I trusted him.

Paige Burcham Dennis: Could you repeat that? His name was what?

Sydney Friedopfer: Cade Cothren.

Paige Burcham Dennis: OK.

Sydney Friedopfer: Being a 22, 23-year-old at the time, I, unfortunately, did not have any information about politics. I asked him if it was illegal to open it for him. And he said no. And he said he just couldn’t have a name on it, considering everything he had gone through, which I’m sure everyone’s aware. But yeah, he resigned from his position as chief of staff to Glen Casada. And he didn’t want his name on the political action committees. Like being young and dumb, honestly, regarding this, I –

Paige Burcham Dennis: So Sydney, you had an involvement, a relationship or friendship, with him. And he asked you to do this on his behalf. That’s what you’re saying?

Sydney Friedopfer: Yes. I mean, yeah. At the time, I thought I loved him, I guess. But I was young and he’s 10 years older than me. And I trusted him. And so I opened the political action committee for him. And I filed the papers, signed my name, and that was the last I heard of it. I received the e-filing thing in the mail. And I just sent him a picture of that. And he took over from there. And I didn’t hear about it again until a reporter started calling me. But the first time I had anyone call me from a reputable source that I was going to talk to was when Lauren called me a few weeks ago.

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In search of Phoenix Solutions

The mailing address of Phoenix Solutions, a PostNet store in Santa Fe, N.M., on July 2, 2021. (Erik Schelzig, Tennessee Journal)

The Tennessee Journal has ventured deep into New Mexico in search of the elusive political mail vendor believed to be at the center of a federal investigation into three sitting state lawmakers.

The mailing address of Phoenix Solutions is a mailbox store in a strip mall in Santa Fe, located next to a shuttered vape shop. Other businesses in the complex include a Harbor Freight tool store, a Carl’s Jr. fast food restaurant, and a drive-thru coffee shop called Agapao. Felipe’s Tacos is located across the street. There was no sign of the vendor’s purported proprietor, Matthew Phoenix, whom nobody has been able to reach since last year.

The mailing address of Phoenix Solutions, a PostNet store in Santa Fe, N.M., on July 2, 2021. (Erik Schelzig, Tennessee Journal)

The FBI in January raided the offices of Republican Reps. Glen Casada of Franklin, Robin Smith of Hixson, and Todd Warner of Chapel Hill, along with the home of Cade Cothren, the former chief of staff to Casada when he was House speaker. Investigators have been mum about the reasons for the raid, but speculation has centered on the sudden prominence of Phoenix Solutions starting in early 2020.

The mailing address of Phoenix Solutions, a PostNet store in Santa Fe, N.M., on July 2, 2021. (Erik Schelzig, Tennessee Journal)

Holt Whitt, the interim chief of staff for Casada and current speaker Cameron Sexton (R-Crossville) has obtained a letter from federal prosecutors that he is considered a witness in the case. Suspended after he was questioned in the January raids, Whitt has now been hired as Human Resources adviser in Gov. Bill Lee’s adminstration.

Is Matthew Phoenix out here somewhere? Santa Fe, N.M., on July 2, 2021. (Erik Schelzig, Tennessee Journal)

FBI agents interviewed lawmakers throughout session, Zachary says Casada promoted Phoenix

Federal agents meet with legislative staffers outside the office of Rep. Glen Casada (R-Franklin) in Nashville on Jan. 8, 2021. (Erik Schelzig, Tennessee Journal)

As first reported in the print edition of The Tennessee Journal, federal agents have been conducting interviews throughout the legislative session of lawmakers who engaged Republican Reps. Glen Casada of Franklin and Robin Smith of Hixson for political consulting work.

As recently as the last day of the session, state Rep. Jason Zachary (R-Knoxville) told colleagues he had spoken to federal agents in his office. Zachary spent $4,408 with vendor Phoenix Solutions (though he misspelled it as “Phenoix Solutions” on his disclosures), the outfit believed to be at the center of the FBI probe.

Several colleagues have said Smith was a vocal advocate for steering more political work to Phoenix Solutions. She and Casada have both declined to say whether they have an ownership stake in the business.

“They did not tell me I couldn’t disclose the information that we discussed,” Zachary explained to Chattanooga Times Free Press reporter Andy Sher following the Journal report, adding “even with my colleagues, I’ve still tried to be very careful about disclosing what we discussed.”

“Everything centered around the investigation with my colleagues, specifically Rep. Casada, Rep. Smith… I did a survey with Glen and it went through the Phoenix Solutions,” Zachary told the paper.

It’s the first time Phoenix Solutions has been publicly linked to Casada, a former House speaker. Others have said they were told to bill the vendor for work done at the behest of his former chief of staff, Cade Cothren, or at the urging of Smith.

Zachary said he didn’t feel he provided any new information to agents “because Glen never pressured me, he didn’t hound me” to use the firm.

Registered in New Mexico in December 2019, Phoenix Solutions ended up receiving $231,000 from Tennessee Republicans in 2020. According to federal tax documents filed with the state, the company was run by a Matthew Phoenix, who at least one state lawmaker said he spoke to on the phone, but none has said to have met in person.

Smith’s attorney, Ben Rose, told the Times Free Press it was “news to us that Zachary, No. 1, has been talking to the FBI and that Zachary was, No. 2, a client of Phoenix. And it certainly didn’t have anything to do with [Smith].” He added, “Our position has been we continue to cooperate with the FBI.”

Paperwork for mystery vendor appears to have been improperly filed in registered agent’s name

Phoenix Solutions, the campaign vendor that has come under scrutiny following an FBI raid on Tennessee lawmakers last month, appears to have improperly filed its application to do business in the state.

A Spokane, Wash.-based company called Northwest Registered Agents LLC had been hired to originally register Phoenix Solutions in New Mexico in November 2019. When the company filed its papers with the Tennessee Secretary of State four days later, it submitted an electronic signature in the name of the same Northwest employee, Morgan Noble. The problem is that Noble did not submit the latter filing for Phoenix Solutions, according to her employer.

“We did not do that,” Jed Smith, a spokesman for Northwest Registered Agent LLC, told The Tennessee Journal. “It was unauthorized.”

The company remains a client of Northwest in both New Mexico and Tennessee, but Smith said “we weren’t hired” for registration purposes in the latter.

Phoenix Solutions did $231,144 worth of business with Tennessee Republicans — almost entirely from House members — in the year since emerging on the scene. Rep. Robin Smith of Hixson, a former state GOP chair and then a freshman lawmaker, was a chief proponent of directing caucus business toward Phoenix Solutions.

Smith, newly elected Rep. Todd Warner (R-Chapel Hill), and former House Speaker Glen Casada (R-Franklin) had their homes and offices searched by federal agents. Smith and Casada have declined to answer questions about whether they or former aide Cade Cothren (whose home was also searched) had any financial ties to Phoenix Solutions.

A phone number for Phoenix Solutions listed in invoices filed with the Tennessee General Assembly is disconnected.