Former Chief Executive, Jackson County in Missouri

Democrat Describes Bush DOJ 'Political Terrorism'  

Katheryn Shields, former chief executive of Jackson County in Missouri, spoke about prosecutorial abuse March 25, 2010 during a forum at American University in Washington, DC entitled, Blindsided: My Experience with the Politicized Bush II Administration’s DOJ.

Acquitted along with her husband of mortgage fraud charges in 2007, she believes she was set up and indicted to prevent her from winning the Kansas City mayor's job that year in a swing state that might prove crucial during the 2008 Presidential election.  She began her university talk as follows:

Let me take you back for a moment to the autumn of 2004. George W. Bush was in a desperate fight for election. His 2000 victory through the Supreme Court had conferred no legitimacy, and his handling of the Iraq war was a fiasco. His response to this situation had been a desperate – but highly effective – negative attack on the heroic war record of the Democratic nominee for President, John Kerry.  She continued as follows:

When Senator Kerry came to speak at a rally in Kansas City, Missouri, it was I who was asked to introduce him. I was a logical choice. I was in the middle of an unprecedented third term as County Executive of Jackson County – the second largest county in the swing-state of Missouri. I was popular with the traditional Democratic bases in labor and the minority communities. On the Kansas City Council, before becoming County Executive, I had introduced an ordinance that would ban discrimination on the basis of sexual orientation. As County Executive, I had instituted policies that would earn Jackson County over two dozen environmental awards. As well, I had cut the cost of long-term road maintenance, and had insisted that maintenance companies doing business with the County provide health care for their workers.

It was no secret that I was not running for a fourth term, but was going to run for Mayor of Kansas City in the elections to be held in the Winter of 2007, just after my third term as County Executive ended. I had a campaign war chest built, filled, and waiting. But, because I had been re-elected for my second and third terms with little opposition, I had also been able to raise a lot of money for other Democrats – including U.S. Senator Claire McCaskill.

A few months after the rally introducing John Kerry, in early 2005, I became the subject of an intense federal investigation. Every contract I approved as County Executive was subpoenaed to a federal Grand Jury – and the news of the subpoena leaked in ominous tones. Of course, unlike the federal government, the State of Missouri has an Open Records Law. No one needs to subpoena public records such as contracts. One needs only to ask for copies. Therefore, why a subpoena, if not to embarrass and create the misimpression of wrongdoing? 

Then, the FBI began going around questioning both major contributors to my campaign and those who had attended fundraisers at my home for other Democrats. It became obvious that a message was being delivered: Support Shields or the Democrats she supports, and you get to be the subject of a federal investigation. Send a check, get an FBI visit.
As annoying as it was for me, it must have been terribly frustrating for the FBI. All of my County contracts were absolutely legitimate. There was no scandal, and certainly no crime. None of my contributors were willing to lie about me. None of my staff were willing to lie about me. Despite serial grand juries reviewing these documents and the FBI and witness testimony, No Bill of Indictment was forthcoming.

To learn what happened next, see the final pages below following a summary of the official charges and selected news stories.

Authorities said the case involved an alleged attempt to defraud a lending agency in connection with the sale of a residence owned by defendants Philip Cardarella and Katheryn Shields as husband and wife. The purported organizer of the fraudulent activity, co-defendant Ronald Zwego, was alleged to have created a false selling price for the residence of $1.2 million by utilizing an inflated appraisal and strawparty buyers (who would not repay the mortgage loan). Cardarella and Shields were going to receive $707,000 of the sales proceeds (essentially their asking price for their residence) with Zwego and other dividing the remaining sales proceeds.  The indictment listed the defendants as follows:

Katheryn J. Shields, 60, Phillip F. Cardarella, 59, James Elliott Coleman, 58, Raymond Walter Zwego, Jr., 58, and James R. Rhoades, 48, all of Kansas City, Mo., Larry E. Barshaw, 56, and Linda M. Thompson-Barshaw, 57, both of Kansas City, Kan., Monty J. Kinman, 25, of Overland Park, Kan., Rick A. Peterson, 32, of Lenexa, Kan., Jeremy A. Plagman, 29, of Lee’s Summit, Mo., and Michael Rodd, 52, of Olathe, Kan., were charged in a 12-count indictment returned by a federal grand jury.

Shields is a former Jackson County Executive and an attorney who is married to Cardarella, an attorney in private practice. Coleman is a Certified Public Accountant who formerly served as president of the board of a Kansas City magnet school. Zwego owns and operates Xpress Car Sales, Xpress Car Rental, North Mission Investments, Cobalt Blue, LLC, and Indigo Blue in North Kansas City, Mo. Thompson-Barshaw is the owner of Colormarc, Inc., a remodeling business that employed her husband, Barshaw. Count One of the federal indictment alleges that, from early September through Nov. 17, 2006, all of the co-defendants participated in a conspiracy to defraud Fieldstone Mortgage Corporation. According to the indictment, Shields and Cardarella attempted to sell their home at a fraudulently inflated price to the Barshaws, acting as straw buyers for the benefit of Zwego, who hoped to pocket the difference between the loan amount and the true sale price.

“This case represents another tragic example of intelligent individuals – including lawyers and prominent elected officials – thumbing their noses at the law in the pursuit of quick and easy cash,” Schlozman said. “We will continue to aggressively target white collar criminals with a relentless vigilance.”