The TBI and the FBI raided the Rutherford County Sheriff's Office Thursday morning. WGNS' Scott Walker spoke to TBI Public Information Officer Susan Niland outside of the Sheriff's Office.
A Rutherford County Sheriff's Deputy would not allow WGNS to actually enter the Sheriff's Office lobby on Thursday. Walker also spoke to FBI Special Agent Jeffery Peterson stated:
The FBI told WGNS that it was too early into their investigation to determine if any charges would be filed at this point.
UPDATE - Further Information from News Partner The Post (Read The Post here):
All of the locations have links to the unapproved sale of e-cigarettes to jail inmates here over nearly a year and a half.
Federal and state agents posted crime scene tape in the sheriff's office administrative and information and technology areas, in addition to the front lobby records office, as they started going through the building.
"TBI agents are here on site executing a search warrant as part of the agency's investigation into possible corruption within the Rutherford County Sheriff's Office," said Susan Niland, TBI public information officer. "It is a joint investigation between the FBI and TBI."
Shortly before 8 a.m., agents hit the sheriff's office, Arnold's home at 552 Osborne Lane, and Russell's homes at 560 Osborne Lane and Riverview Drive, Niland confirmed.
FBI Special Agent in Charge Jeff Peterson said multiple search warrants were served, four in Murfreesboro and one in Marietta, Ga. John and Judy Vanderveer, the uncle and aunt of Arnold, who are partners with Russell in JailCigs, live in Marietta.
"The search warrants were for documents and digital evidence that was collected by forensic experts by both the TBI and FBI. That information will be analyzed for any evidentiary value," Peterson said. "It's important that we remember that all parties are considered innocent until proven guilty."
FBI experts will analyze the evidence and if wrongdoing is found will turn it over the U.S. Attorney's Office in the Middle District of Tennessee for "appropriate charges" or to state court where the FBI partners with TBI, Peterson said.
Neither Niland nor Peterson could say how long the joint investigation would last. Agents had cleared the homes of Arnold and Russell before 11 a.m., according to Niland.
Because it is an ongoing investigation, Niland could not say why the FBI joined the investigation. But Peterson said the FBI has "primary jurisdiction" in public corruption matters, which is concurrent with state law and the reason for the joint investigation.
Federal agents typically handle investigations into interstate commerce violations, as well.
"This one did happen across state lines, but that is not the sole reason" the FBI got involved, Peterson said. "The TBI and the FBI take any allegations of public corruption seriously. It's a violation of trust, especially when it involves a top law enforcement official or any law enforcement official for that matter. So it is our duty to find the facts in the case and, again, exonerate the innocent and prosecute the guilty."
TBI and the state Comptroller's Office have been investigating Arnold's administration for more than a month following revelations Arnold, his family and Russell are connected to a Marietta, Ga.,-based company, JailCigs, which was selling e-cigarettes to county jail inmates at $12.95 a pop without a County Commission-approved contract.
Arnold, a Republican who won election to a second term last August, lists JailCigs as an investment and source of income on a financial disclosure form filed with the Tennessee Ethics Commission in January. He also lists his wife, Megan, as holding investments in JailCigs on the document, the signing of which was witnessed by Chief Deputy Randy Garrett, second in command at the office.
JailCigs, which has since been suspended from the county jail, is owned by Arnold's uncle and aunt, the Vanderveers, and Russell, who was Arnold's campaign chairman and financial chief at the sheriff's office, Georgia state documents show. They also own a company called JailSnacks.
Russell is also Arnold's next-door neighbor but put his Osborne Lane house on the market this week as an owner/agent.
The sheriff, who has declined comment on the most part during the investigation, also signed and amended other contracts without County Commission approval or the knowledge of top county officials, a violation of the county's purchasing process and a possible misdemeanor.
He inked a contract with Telmate, LLC, a Delaware limited liability company based in San Francisco, for an inmate pilot tablet use and services agreement in December 2014, according to documents obtained by The Post. The tablets enable inmates to communicate with family and friends, paying a fee to use them.
Records obtained by The Post also show the sheriff made a contract amendment between Keefe Commissary Network and the county jail in December 2012 under which Keefe would be the "sole provider" for inmates to order products through family and friends. Keefe would put 25 percent of adjusted gross sales into a "technology fund" starting Jan. 1, 2013 for the jail to buy computer and other electronic equipment.
Arnold also approved a deal with one of the vendor's subsidiaries to purchase tasers, lasers and holsters, bypassing the county's purchasing procedures and without the knowledge of top county officials, records show.
In addition, John Vanderveer paid nearly $8,000 for 1,000 prison bags for inmates, according to documents obtained by The Post. That order, which was not approved by county commissioners, was to be delivered to the sheriff's office June 22.
Neither Mayor Burgess nor Finance Director Lisa Nolen knew anything about a "technology fund," the purchase order involving stun guns the sheriff's office made in mid-March or the Telmate contract.
"No one is authorized to execute a contract, sign a contract without (county) commission approval," Burgess said. "We're not to buy any products or enter into any agreements without going through the purchasing committee. That's the fundamental starting point."
"None of those items, even though the 'technology fund' is not approved or appropriate, those weren't even technology items had they been trying to comply with it," Burgess said.
The sheriff's office suspended JailCigs as a vendor after news broke about its connections with the sheriff. But the jail received one more delivery April 9 and distributed the e-cigs to inmates because they'd paid for them.
Tennessee Sheriff's Association Executive Director Terry Ashe also suspended JailCigs as a vendor for association events until the matter is resolved.
The Vanderveers are parents of Deputy James Vanderveer, who was charged with DUI and resigned from the sheriff's office before returning to a job there. He and the sheriff are also targets in a federal lawsuit after he allegedly violated an inmate's constitutional rights by pepper-spraying him when he was restrained.
The Rutherford County Ethics Committee also requested an investigation of the sheriff's office. In addition to unauthorized contracts, committee members asked the district attorney general to determine possible conflicts of interest regarding Russell, who conducted JailCigs business from inside the sheriff's office, according to his emails, and Detective Commander Bill Sharp, who has been running a private training and consulting business out of the sheriff's office. Russell and Sharp are on administrative leave with pay.
The sheriff's office also placed Capt. John Frost, director of IT, on administrative leave with pay but declined to say why.