Transcripts detail bribe in Virgin River water rights deal

The Southern Nevada Water Authority would have delayed an $8.4 million deal to buy Virgin River water rights in 2008 had it known a local regulator stood to profit from the deal, grand jury transcripts show.

John Entsminger, the water authority’s assistant general manager, told the grand jury that the Virgin River Water District’s chief hydrologist at the time, Michael E. Johnson, was intimately involved in brokering the deal but never informed him of his financial stake.

“If we had any knowledge of a personal interest by an employee of the Virgin River Water District, we would have put on the brakes and figured out what needed to be done, including possibly terminating the transaction,” Entsminger testified.

He told the grand jury that he would have been concerned to hear that Robert Coache, then a deputy state engineer who played a big role in granting water rights in Southern Nevada, had a financial interest in the Virgin River deal.

Johnson, 51 and Coache, 52, are charged in a 50-count indictment with taking a $1.3 million bribe to help wealthy Bunkerville landowner John Lonetti Jr. sell his Virgin River rights to the water authority. Lonetti, 77, has not been charged in the Las Vegas police investigation.

Part of the $8.4 million deal involved swapping water rights between the authority and the Virgin River Water District, whose officials didn’t know about Johnson’s dealings with Lonetti, according to the grand jury transcripts.

Though the deal is tainted by the indictment, District Attorney David Roger said Tuesday there is no reason for water authorities to undo it.

“In this case you have two water agencies that do not appear to be criminally culpable,” Roger said. “Therefore, the transaction between the two entities is valid.”

Water authority spokesman Scott Huntley said his agency is happy with the deal.

“We don’t have any intention of reviewing it,” he said. “We have verified that we got the water we paid a fair price for, and really, from our end of the deal, that is what is in our interest.”

The Virgin River Water District filed a lawsuit in March against Johnson, accusing him of breaching his “duty of loyalty” to the district through his secret dealings. The district wants to recover his share of the money involved in the case for its ratepayers, the residents of Mesquite and Bunkerville, the lawsuit said.

Jason King, a deputy state engineer at the time in Carson City, told the grand jury that he never would have signed a key permit that paved the way for the water deal had he known that Coache was going to profit from it.

“For someone to work for the state engineer’s office to be involved in the sale of water rights, which is what we do day in and day out, is a conflict of interest and … you don’t do that,” testified King, who now runs the engineer’s office.

Nate Chio, the lead detective in the investigation, testified that during a search of Coache’s home, he found a file labeled “John Lonetti” that contained Lonetti’s address and cellphone number and copies of the state permits Lonetti needed to sell his water rights.

The file also contained a handwritten diagram of the roughly “50-50 split” between Coache and Johnson of the
$1.3 million, with documents establishing Rio Virgin LLC, a partnership the defendants used to launder the money, Chio said.

Coache and Johnson, both free on $250,000 bail, are accused of running a series of financial transactions through Rio Virgin, including the purchase of several homes.

Police obtained a court order to seize two of the homes but have not physically taken possession of them nor evicted their residents. They have filed the seizure documents in District Court and with the Clark County recorder to prevent the owners from selling the properties.

Chio testified that Coache tried to influence the testimony of a friend who had incorporated Rio Virgin for the two defendants.

He said the friend, contractor Steven Templeton, had “done a complete 180” in a second interview with detectives a couple of days after discussing the investigation with Coache.

In the second interview, Templeton attempted to put distance between Coache and Rio Virgin, Chio testified.

The indictment alleges Coache and Johnson carried out the bribery scheme between January 2006 and May 2008 and laundered the proceeds until Sept. 13.

Coache retired from his state job in May 2010, and Johnson resigned under fire from the Virgin Valley Water District in August.

Contact Jeff German at jgerman@reviewjournal.com or 702-380-8135.

ad-high_impact_4
News
Clark County Schools announce random searches
Clark County School District middle and high school students will be subject to random searches for weapons under a new initiative to combat the wave of guns found on campus. (Amelia Pak-Harvey/Las Vegas Review-Journal)
Ron Jeremy and Heidi Fleiss React to Dennis Hof's Death
Ron Jeremy and Heidi Fleiss speak about their friend and prominent brothel owner Dennis Hof's death at Dennis Hof's Love Ranch. (Benjamin Hager/Las Vegas Review-Journal)
Nevada brothel owner Dennis Hof has died
Nevada brothel owner and Republican candidate for Nevada State Assembly District 36, Dennis Hof has died. He was 72. Nye County Sherriff's office confirmed. Hof owned Love Ranch brothel, located in Crystal, Nevada.
Las Vegas police investigate suspicious package at shopping center
Las Vegas police evacuated a southeast valley shopping center at Flamingo and Sandhill roads early Tuesday morning while they investigated reports of a suspicious package. (Max Michor/Las Vegas Review-Journal)
The Las Vegas Metro hosts the K-9 Trials
The Las Vegas Metro K-9 Trials returns to the Orleans Arena to benefit the Friends For Las Vegas Police K-9 group.
Kingman residents love their little town
Residents of Kingman, Ariz. talk about how they ended up living in the Route 66 town, and what they love about their quiet community. (K.M. Cannon/Las Vegas Review-Journal)
Service at Southern Nevada Veterans Memorial Cemetery
Twelve unclaimed veterans are honored at Southern Nevada Veterans Memorial Cemetery in Boulder City in Oct. 9, 2018. (Briana Erickson/Las Vegas Review-Journal)
Las Vegas house prices reach highest level in 11 years
Las Vegas house prices are rising But so is the amount of available homes on the market Still, properties priced below $300,000 are selling fast And September was the first time since June 2007 that the median house price reached the $300,000 mark Las Vegas home prices have been rising at one of the fastest rates in the country over the past year Recent data show the market is now less affordable than the national average
National Night Out
About 100 Summerlin residents gathered at Park Centre Dr. in Summerlin on Tuesday for National Night Out. Lt. Joshua Bitsko with Las Vegas Metro, played with 3-year-old David who was dressed as a police officer. Face painting, fire truck tours and more kept kids busy as parents roamed behind them. (Mia Sims/Las Vegas Review-Journal)
Rural homeless issue comes to a head in Pahrump
On Sept. 12, Pahrump sheriff deputies told residents of a homeless encampment on private property that they had 15 minutes to vacate and grab their belongings. That decision might face some legal consequences. (Rachel Aston/Las Vegas Review-Journal)
Remembrance blood drive on October 1
A blood drive was held at the Las Vegas Convention Center on the one year anniversary of the Oct. 1 shooting. (Mat Luschek/Las Vegas Review-Journal)
Remembrance Lights memorial unveiled at St. Rose hospital
A dedication ceremony was held at St. Rose to unveil a memorial and to read the names of those who died on October 1, a year ago. (Mat Luschek/Las Vegas Review-Journal)
1October Blood Drive Remembrance Wall
(Mat Luschek/Las Vegas Review-Journal)
1October Blood Drive
Vitalent hosts a blood drive at the Las Vegas Convention Center on Monday, Oct. 1, 2018, the first anniversary of the Las Vegas shootings. (Mat Luschek/Las Vegas Review-Journal)
1October sunrise remembrance ceremony in Las Vegas
Myanda Smith, sister of Las Vegas shooting victim Neysa Tonks, speaks at the sunrise remembrance ceremony at the Clark County Government Center in downtown Las Vegas, Monday, Oct. 1, 2018. (Chitose Suzuki/Las Vegas Review-Journal)
‪Gov. Brian Sandoval speaks to crowd at Oct. 1 sunrise remembrance ceremony ‬
‪Nevada Gov. Brian Sandoval speaks to the crowd at the Oct. 1 sunrise remembrance ceremony ‬at the Clark County Government Center in downtown Las Vegas, Monday, Oct. 1, 2018. (Michael Quine/Las Vegas Review-Journal)
Father of Route 91 Harvest festival shooting victim talks about college scholarship in his daughter's memory
Chris Davis, father of a Route 91 Harvest festival shooting victim, Neysa Tonks, talks about a college scholarship in his daughter's memory to assist the children of those who died in the shooting. (Bizuayehu Tesfaye/Las Vegas Review-Journal) @bizutesfaye
Oct. 1 survivor Malinda Baldridge talks about life after the shooting
Malinda Baldridge of Reno attended the Route 91 Harvest festival with her daughter, Breanna, 17, and was shot twice in the leg when the gunman fired on the crowd.
Route 91 survivor talks about lack of progress in gun legislation
Heather Gooze, a Route 91 survivor, talks about lack of progress in gun legislation since the Oct 1. (Bizuayehu Tesfaye/Las Vegas/Review-Journal) @reviewjournal
Review held in death of man after encounter with Las Vegas police
The mother of Tashii Brown, who died after an encounter with Las Vegas police on the Strip, not satisfied after public review of evidence. (K.M. Cannon/Las Vegas Review-Journal)
Clark County Museum opening "How We Mourned: Selected Artifacts from the October 1 Memorials"
The Clark County Museum is opening an exhibit "How We Mourned: Selected Artifacts from the October 1 Memorials" of items left to honor the victims killed in the Route 91 Harvest festival shooting. (Bizuayehu Tesfaye/Las Vegas Review-Journal) @bizutesfaye
Memorial service for former RJ lawyer Mark Hinueber
Mark Hinueber, the Review-Journal's former lawyer and defender of the First Amendment, died in Las Vegas on Aug. 23. Hinueber, who was 66, worked at the RJ and other newspapers for 42 years. On Saturday, his friends and family gathered for a memorial service.
Army veteran honored in Henderson event
Army Sgt. Adam Poppenhouse was honored by fellow veterans in an event hosted by a One Hero at a Time at the Henderson Events Center.
Michelle Obama and Keegan-Michael Key urge Nevadans to vote
Former first lady Michelle Obama and comedian Keegan-Michael Key urged Nevadans to vote at Chaparral High School in Las Vegas Sunday, Sep. 23, 2018. (Marcus Villagran/Las Vegas Review-Journal) @marcusvillagran
Nevada Task Force One Cheers Golden Knights
Nevada Task Force One Cheers Golden Knights
1 dead, 1 wounded in North Las Vegas standoff
A woman was hospitalized with serious injuries on Thursday morning after being shot inside a North Las Vegas house. Police responded about 11 p.m. to a shooting at a home on the 5600 block of Tropic Breeze Street, near Ann Road and Bruce Street. The wounded woman, police believe, was shot by a man, who later barricaded himself inside the house. SWAT was called to assist, and when officers entered the house, they discovered the man dead from an apparent self-inflicted gunshot wound.
Las Vegas Teen Makes Clothing Resale His Side Hustle
Las Vegas resident Reanu Elises, 18, started buying and selling streetwear online when he was a high school junior. Like many other young adults, the world of online resale applications like Depop and Mercari have made selling clothing online for a profit easy. Now, Elises spends his free time at thrift shops looking for rare and vintage clothing he can list on his on his shop. Now in his freshman year at UNLV as a business marketing major, Elises hopes to open a shop of his own one day and start his own clothing brand. He estimates that he's made about $1000 from just thrifted finds in the past year, which he'll use to buy more thrift clothing and help pay for expenses in college. (Madelyn Reese/ Las Vegas Review-Journal) @MadelynGReese
Fruition Vineyards Encourages Young Entrepreneurs to "Buy, Flip, Dream"
Once a month, young adults gather at Fruition Vineyards on South Maryland Parkway near UNLV to dig through a stack of rare, vintage and designer clothing that's marked down well below it's resale value. Shop founder Valerie Julian began the vent, dubbed "Fruition Vineyards" in August after running her streetwear shop since 2005. The event gives young entrepreneurs the opportunity to "buy, flip, dream" according to Jean. Meaning that they're encouraged to buy the clothing for sale and find a way to resell it for a profit, then reinvest that into whatever dream they pursue: college, a hobby or their own resale business. Shoppers lined up starting an hour before noon on the last Saturday in April for the opportunity and spoke about what they hoped to do with their finds and profits. (Madelyn Reese/Las Vegas Review-Journal) @MadelynGReese
Local man goes under cover searching for answers to homelessness
Licensed mental health therapist Sheldon Jacobs spent 48 hours under cover posing as a homeless man in an attempt to gain perspective on the complex issue.
Social Work UNLV Lecturer's Calling
Ivet Aldaba-Valera was the first person in her family to graduate from both high school and college. The 33-year-old UNLV lecturer is now pursuing her Ph. D in public policy at the school and has used her degree in social work to engage with the young Latino and Latina community of Las Vegas. (Madelyn Reese/Las Vegas Review-Journal) @MadelynGReese
Crime
Family members of murder victims talk about their loss
Family members of murder victims talk about their loss. Susan Nash, 52, was killed in a shooting along with her daughter and one of her three sons on Sunday night. Bizuayehu Tesfaye/Las Vegas Review-Journal @bizutesfaye
Sayegh Cold Case Turns 40
Cary Sayegh was abducted from the playground of the Albert Einstein Hebrew Day School in Las Vegas in 1978. His body has never been found. (File Photo)
Review held in death of man after encounter with Las Vegas police
The mother of Tashii Brown, who died after an encounter with Las Vegas police on the Strip, not satisfied after public review of evidence. (K.M. Cannon/Las Vegas Review-Journal)
Vehicle of Interest in January Homicide
Las Vegas police released footage Friday of a “vehicle of interest” from a deadly shooting in January. (Las Vegas Metropolitan Police Department)
Hostage escapes clutches of robber before shooting
Metropolitan Police Department footage shows a man wearing a motorcycle helmet, identified by police as 27-year-old Mario B. Trejo, with one arm wrapped around a woman’s neck and held a handgun to her head.
Sunset Park Vigil
A small group of people gathered in Sunset Park to remember the three children recently killed in the area.
Henderson police bodycam footage of officer-involved shooting
Henderson police released body-worn camera footage of an officer-involved shooting in a grocery store parking lot at 2667 Windmill Parkway on Aug. 12, 2018. (Henderson Police Department)
Metro Asst. Sheriff Brett Zimmerman on Aug. 8 officer-involved shooting
Metropolitan Police Department Assistant Sheriff Brett Zimmerman met with media Monday to discuss the details of the 14th officer-involved shooting of the year. (Madelyn Reese/ Las Vegas Review-Journal)
Nye County detectives pursue suspects
A swarm of Nye County deputies, at the request of Las Vegas police, surrounded a hotel room in Pahrump last week to take two fugitives into custody. (Nye County Sheriff's Office)
TOP NEWS
News Headlines
Add Event
Home Front Page Footer Listing
Circular
You May Like

You May Like