The former office manager of a Perry County pain clinic pleaded guilty Monday to helping launder money from the alleged illegal distribution of pain medication.
Benny Ray Bailey Jr., the son of former Democratic state Sen. Benny Ray Bailey, said in a court document that he knew his bookkeeping work would help conceal money the clinic generated from improper prescribing practices.
Bailey also acknowledged improperly getting $40,000 over a period of about two years, according to his plea agreement.
Bailey was indicted last year on two charges of conspiring to distribute and illegally dispense controlled substances at the Clarion Health and Wellness LLC pain clinic, and on one count of conspiring to operate a drug business.
However, as part of his plea deal with the government, Bailey pleaded guilty to one count of conspiracy to commit money laundering.
The maximum sentence on the charge is 20 years in prison, but Bailey's sentence is likely to be much lower under advisory federal guidelines. Bailey is to be sentenced July 30 in federal court in London.
Bailey was charged with James Dustin "Dusty" Chaney, a doctor who owned the clinic, and Andrew Krasuski, a doctor who worked there. They were indicted on the same charges as Bailey.
Bailey started working at the clinic in February 2011. His duties included marketing, hiring staff members and financial management, according to his plea agreement.
Krasuski started working at the clinic soon after.
Bailey said that in July 2011, he started to notice that Krasuski seemed to be prescribing "potent dosages" of pain medication improperly.
Bailey said he raised his concerns with Chaney several times over the next six months, but Chaney rebuffed him and supported Krasuski's work, according to the plea document.
The document said Bailey became convinced Krasuski and some other doctors who filled in at the clinic were writing prescriptions to patients improperly, but stayed on at the clinic for a time despite those concerns.
Bailey said he understood some of the money he handled for the clinic resulted from illegal activity.
Bailey acknowledged he "knew and intended that continuing to process these sorts of transactions just as he had always done would conceal that portion of Clarion's income that came from the unlawful dispensation of controlled substances by illegitimate prescriptions," according to his plea agreement.
Bailey also said he held back thousands of dollars in cash each month from the clinic's deposits, and paid it to people in an "under the table" fashion at Chaney's direction.
The most common recipients were Chaney and two clinic employees, Bailey said in his plea document.
Bailey agreed as part of the plea to forfeit $40,000 he had received to the government.
Plea agreements such as Bailey's often require the person pleading guilty to testify against others in the case if called.
Chaney and Krasuski have maintained their innocence.
One of Chaney's attorneys, Mark Wohlander, said Bailey is lying and he would welcome cross-examining him.
"We look forward to going to trial," Wohlander said.
Wohlander said he plans to talk with the commonwealth's attorney in Perry County about charging Bailey with stealing money from Chaney's clinic.
Bailey's attorney, Brandon Wayne Marshall, said Bailey denies stealing money from Clarion Health and Wellness.