‘Crucible of cross examination’ underway in federal fraud trial of former JEA executives

JACKSONVILLE, Fla. — The defense grilled witnesses for the prosecution on Monday in the federal fraud trial of two former JEA executives.

Action News Jax’s Ben Becker was inside the federal courthouse in downtown Jacksonville when testimony continued in the trial of former JEA CEO Aaron Zahn and former CFO Ryan Wannemacher. Zahn and Wannemacher are facing federal fraud and conspiracy charges.

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Zahn and Wannemacher both face up to 25 years in federal prison for in the words of prosecutors, “conspiring to steal and obtain by fraud funds from the City of Jacksonville which would have been generated from the sale of JEA.” That number? Up to $345 million.

Both men are being tried at the same time, but each have their own jury.

RELATED: ‘Surprised and somewhat disappointed:’ Witness testimony underway in JEA executives trial

Since this is a federal trial, no cameras are allowed inside court, but Becker took notes on what’s going on inside.

Here’s what’s happened Monday:

• During her testimony, Council Auditor Kim Taylor of the Jacksonville City Council Auditor’s Office discussed “concerns” she had over a proposed JEA bonus plan, known as the Performance Unit Plan (PUP). She was saying it was uncapped, unlimited. Both Wannemacher and Zahn are accused of trying to skim tens of millions of dollars from that plan. Taylor also said she wasn’t getting cooperation from Wannemacher when she started asking questions.
• David Wathen of the Willis Towers Watson consulting firm said he “didn’t authorize” draft work to be used as part of the presentation to the JEA board to start the process to sell JEA in July 2019.
• Patricia Maillis, director of employee services in charge of employee compensation and benefits at JEA, testified that she didn’t know about the bonus plan. She said it was a conflict of interest and insider trading. She’s in charge of employees and didn’t know about a bonus plan that was supposed to help employees.
• Kyle Billy, the former council auditor, started testifying on Monday and he will continue his testimony on Tuesday. He first raised the red flag about the bonus plan.

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Here are observations of Action News Jax law and safety expert Dale Carson, who was also inside the courtroom along with Becker:

• “This is an exciting day because this is where the government’s presenting its case and the defense gets to cross-examine the witnesses,” Carson said.
• “The crucible of cross-examination is where the defense looks at this critically and they try to pick it apart. And if I don’t miss my guess, (Assistant United States Attorney A.) Tysen Duva is doing a fine job at just rolling the actual case out in an intelligent way without trying to demean the actual witnesses,” Carson said.
• Carson said to keep the jury engaged, the government is bringing in a greater amount of witnesses -- 30 instead of three. “You do see one fascinating aspect of this jury panel. They’re actually paying attention to the accounting details that would tend to put most of us to sleep,” Carson said.
• Carson talked about the defense and how they may act differently than Jacksonville locals. “I don’t see them as being local people so they don’t behave in a way that’s consistent with how we behave here,” Carson said. “We’re courteous, we do certain things that people like and expect from us as individuals in Jacksonville. And if you’re not from here, you don’t really understand that dynamic because you’ve never lived it.”

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Becker spoke with Zahn as he was leaving court at the end of the day. Zahn thanked local journalists for reporting on the trial. Here is part of the exchange Zahn had with Becker:

Becker: “Was it a difficult day?”

Zahn: “Um, Ben, every day’s a difficult day in these things.”

Becker: “A lot of testimony back and forth. It’s interesting having kind of that front row seat to see how it all plays out, right?”

Zahn: “That’s your opinion in terms of how it’s all playing out. I can’t comment on the case, I’m sorry.”

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Defense grills prosecution witnesses in federal fraud trial of former JEA executives Defense grills prosecution witnesses in federal fraud trial of former JEA executives