Thursday, October 01, 2009

GLBT Lobbyist And Spouse Accused Of Embezzling $5.9 Million

Phyllis Stevens (left) and Marla Stevens (right), a married lesbian couple, were among the most active GLBT activists in Indiana up until a few years ago when they moved to Iowa where Phyllis chaired Iowa Marriage Equality. Phyllis Stevens is a 35-year employee of Aviva, a predecessor of Indianapolis Life Insurance Company. A civil lawsuit filed in federal district court in Des Moines, Iowa accuses her of devising a fraud whereby she was paid fictitious commission payments by Aviva over a 5-year period. The $5.9 million in funds allegedly embezzled by Phyllis from the life insurance company were deposited into a joint account held by Phyllis and Marla. "The civil suit names only Phyllis Stevens as the perpetrator of the embezzlement, but also names Marla Stevens as receiving the benefits 'as a result of the conversion of funds,'” reports the Des Moines Register. Marla was a registered lobbyist in Indiana for GLBT causes during the 1990s. According to the Des Moines Register, FBI agents nabbed Phyllis in Las Vegas last Friday on criminal fraud charges.

Marla Stevens was one of the original bloggers for Bilerico, a GLBT blog founded in Indianapolis by Bil Browning. As Browning describes her and Phyllis:

Both Marla and Phyllis Stevens have a well-respected history of LGBT and progressive activism. Marla founded one of Indiana's first gay rights organizations, LGBT Fairness, and was the first Statehouse lobbyist focusing solely on LGBT issues. Marla was also one of the first Hoosier LGBT activist to use direct action techniques to draw attention to gay rights.
Marla often stirred controversy with her postings, including a defamatory post she made on Democratic congressional candidate Kris Kiser during the 2006 congressional primary for Indiana's Seventh District. Stevens, a big contributor and supporter of the Carson political machine, set out to destroy Kiser for daring to challenge the late U.S. Rep. Julia Carson in the Democratic primary. Kiser, a former D.C. lobbyist and congressional staffer, made the run as the first openly gay congressional candidate in Indiana history because he believed Carson's deteriorating health left her unable to perform her job. In a controversial blog posting, Stevens accused Kiser of all kinds of sordid allegations and misconduct that focused on his sexual orientation. Kiser spent more than $200,000 of his own money on the race and lost badly to Carson, who died of cancer a year later.

Marla Stevens became one of the biggest backers of Andre Carson during his special election run to replace his grandmother. According to FEC records, Marla contributed $13,900 to Carson's congressional campaigns. Phyllis kicked in another $11,600 to Carson. Both gave thousands to the late U.S. Rep. Julia Carson. A summary of her federal contributions at The Huffington Post shows that she contributed tens of thousands of contributions to various liberal Democratic candidates in recent years. Sen. Vi Simpson received a $1,000 contribution from Marla. Bilerico reports the couple contributed $175,000 to federal and state Democratic candidates during the 2006 and 2008 election cycles. Stevens' contributions identify her as Director of Public LGBT Fairness in Des Moines. Indiana campaign finance records indicate that Marla and Phyllis contributed thousands to Indiana Democratic candidates and Democratic Party committees prior to moving to Iowa. Iowa campaign records indicate that Phyllis contributed $6,000 to various state candidates there according to the Des Moines Register.

It looks like Republicans in Iowa are already seizing on the scandal to tarnish candidates who accepted money from the couple. The Iowa Republican Party noted her ties to OneIowa in this discussion about the scandal:

Yesterday, Phyllis Stevens of Des Moines was arrested by federal authorities while in Las Vegas on charges that she embezzled an estimated $5.9 million from Aviva USA, a Des Moines-based insurance company. [1] What is interesting about Stevens isn’t that she (allegedly) stole millions from her employer, it’s what she did with her money. Phyllis Stevens and her partner/wife, Marla Stevens, did all the things one would expect wealthy people to do, like purchase a $380,000 Sherman Hill home this past June. However, they also donated tens of thousands of dollars to liberal political candidates and pro-homosexual causes. Both Phyllis and Marla Stevens have been named in a civil suit filed by Aviva USA in an attempt to recover the embezzled funds.

In addition to being a financial analyst with Aviva USA, Phyllis Stevens also served at the chairperson of the Iowa chapter of Marriage Equality USA, a gay rights group. According to disclosure reports filed with the Federal Election Commission, Phyllis’ wife, Marla Stevens, is the public policy director for the LGBT Fairness Fund.

The Fairness Fund in Iowa is an off-shoot of One Iowa, the state’s largest LGBT advocacy organization. Documents filed with the Iowa Ethics and Campaign Disclosure Board show that One Iowa’s executive director, Carolyn Jenison, is also the chairperson and treasurer of the Fairness Fund, meaning it looks like Marla Stevens is basically employed by One Iowa. In addition to being gay rights activists, Phyllis and Marla Stevens are also very generous political donors. Since 2007, the couple had donated more than $60,000 to federal candidates across the country.
A couple of years ago, I raised the issue with several GLBT activists about how Marla and Phyllis could afford to contribute so much money to Andre Carson and other candidates. I was told that Marla had inherited a lot of family money, a claim which I never bought. The couple didn't have that kind of money to dole out during most of their time in Indiana. This development helps explain a lot to me. Many GLBT activists privately said they were not disappointed to see Marla leave Indiana when she and Phyllis moved to Iowa. Her abrasive, unattractive style and unconventional ways sometimes made her the laughing stock of the Indiana lobbying community during her days as a lobbyist at the State House. I'm sure many of those same people are happy the couple got busted in Iowa instead of Indiana.
WHOTV in Des Moines has more here. According to this report, the bank accounts into which Stevens funnelled the money were located at a bank in Indianapolis. Those bank accounts have been frozen according to the report.
UPDATE: The Des Moines Register has more on the wire fraud and money laundering allegations the federal government has leveled against Phyllis Stevens, who has been in the custody of U.S. Marshals since she was arrested in Las Vegas a week ago. According to the complaint, an Aviva worker in the Topeka, Kansas office discovered excessive commission payments being made to a former employee of the company. The company discovered that the address of the former employee matched Stevens', a compensation specialist who earned $40,000 a year. The funds were being deposited electronically into an Indianapolis bank account in her name. After company officials confronted her with the allegations and placed her on leave, Phyllis travelled to Indianapolis where she attempted to pull out $170,000 in cash at a National City Bank branch, telling the bank employees she and her partner were planning an extended trip to Germany.


indyernie said...

Can Congressional office holders be forced to return these funds?

Advance Indiana said...

An ethical politician would repay the funds to the victim without being asked.

Advance Indiana said...

Notice how the Republican Party is asleep at the switch on this one. God forbid the party point out anything that might harm Andre Carson.

Advance Indiana said...

Ed Feigenbaum of the Indiana Legislative Insight offers this view on the subject:

"There will undoubtedly be a push to recover the political
contributions on several levels: by the insurance company, by
the feds, and by those inimical to the interests of the
candidates and other entities that were recipients of what
seems to be the ill-gotten largesse. From the latter, you will
also see candidates attempt to be tied to the alleged fraudulent
activity. This may be one of the largest cases involving
fraudulently obtained cash being directed into federal
campaigns outside of some recent high-profile prosecutions
involving foreign nationals and related contributions."

Anonymous said...

And the insurance company had no idea.....?

And the bank had no idea.....?

And illegal gambling can go on in perpetuity under the noses of the DoJ but they bust these two ladies for this, five years into the program?

My guess is that someone moved someone's toaster on this one, so the DoJ came in to shut it down.

indyernie said...

Andre Carson accepted $6900.00 from Stevens in 2008. How much of the stolen money did her partner donate?

Advance Indiana said...

You didn't read the post correctly, Ernie. Together, the two gave a little over $25,000 to Carson since he formed a campaign committee.

indyernie said...

Correction that should be $9200.00 in March 2008 alone to Andre Carson from this thief.

indyernie said...

In 2006 and 2005 Julia Carson received $4100.00 form Stevens...did Andre get the balance of Julia’s war chest?
Stevens went from donating a high of $9900.00 in 2004 to the democrat party, democrat candidates and associations to $42,938.00 in 2008. The democrats should have known something was up.

And these figures don't account for her girlfriend's donations.

Advance Indiana said...

Andre Carson took a big contribution from a suspected Muslim terrorist. I wrote about it on this blog. None of the news media reported on it. He later quietly returned the contribution. Instead, the media splashed headlines about Jon Elrod putting stamps on campaign envelopes during a down time at the State House, something that is legally permitted. There's a real double standard in reporting in this town. The news media goes to great lengths to protect the corrupt Carson political machine, while they do everything they can to destroy anyone who challenges that political machine. The local news media is useless when it comes to telling the truth about the Carsons.

indyernie said...

With the close connection between Stevens and Carson I wonder if more contributions were made under the table. The possibility exists that more of the embezzled money could have passed through others who are close to Stevens and Carson..

Advance Indiana said...

That's something I'm sure the FBI will be taking a closer look at, Ernie. I found an old comment Marla posted on this blog where she claims she and Phyllis' GLBT activities are all "self-funded" at considerable cost to them personally. Carson collected over half of his money from PACs. They could have laundered the money through any number of sources.

Arthur Breur said...

Update from One Iowa spokesperson, Justin Uebelhor:

I came across your blog posting about Marla and Phyllis Stevens. I want to clarify one thing. The Iowa Republican blog post you link to is wholly inaccurate. Their main contention is false: the LGBT Fairness Fund is not affiliated with One Iowa or our PAC in any way.

The LGBT Fairness Fund appears to be a federal PAC based in Indiana that can give to federal candidates. The Fairness Fund PAC (the political arm of One Iowa) is an Iowa registered state PAC that can only give to candidates for state office. There is no connection between our PACs, nor has Marla ever been employed by our PAC.