DES MOINES -- Federal prosecutors announced Wednesday that a federal grand jury has indicted State Sen. Matt McCoy, charging him with attempted extortion.
The Des Moines Democrat's business dealings with a security firm are at the center of the charge. The indictment alleges he used his position as a state senator to threaten the firm they wouldn't be an official state Medicaid vendor if he was not paid.
U.S. Attorney Matt Whitaker outlined the charge, officially known as "attempted extortion under color of law," at a news conference Wednesday afternoon.
"There's no allegation that he would have been successful or had any sway with the state Medicaid office," Whitaker said. "It's merely the threat that was made."
McCoy is accused of attempting to use his elected office to extort money from Reid Schultz, the owner of an ADT security dealership Security Plus in Des Moines. The company had plans to sell home monitoring systems for the elderly to state agencies.
The indictment alleges, McCoy, 40, attempted to extort $100 for each installation of the monitoring systems.
Between December 2005 and March 2006, McCoy allegedly received $2,000 in cash and checks from Security Plus, money that had been supplied by the Federal Bureau of Investigation.
Whitaker said Security Plus employee Tom Vasquez approached law enforcement officials about his concerns with McCoy.
McCoy called the charge "completely baseless" and denied he broke any laws or any Senate ethics rules.
He described his dealings with Security Plus as a "business dispute between two partners that went sour."
McCoy said his company, Team Development, provided marketing, communications and consulting services for the firm and helped them with a presentation before the state. He said he disclosed those business dealings according to Senate rules.
"These are merely charges," McCoy said. "I'm looking forward to the opportunity to face my accusers."
The charge carries a possible prison term of 20 years, a $250,000 fine or both. Arraignment is set for March 29 in U.S. District Court in Des Moines.
Senate Majority Leader Mike Gronstal, D-Council Bluffs, sent out a statement saying Senate Democrats would continue to monitor the situation "to assure there are no real or perceived conflicts of interest as it relates to his ongoing legislative duties."
"Iowans want, expect, and deserve to have their legislators function in a way that meets a high ethical standard," Gronstal said.
Contact Charlotte Eby at (515) 243-0138 or email@example.com.