McGrath seeks to have state charges, report kept from federal trial

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An attorney for Roy McGrath is asking a federal judge to preclude introduction of state charges and a related report by the Maryland General Assembly when the former top aide to Gov. Larry Hogan is tried on federal charges of wire fraud and theft.

McGrath, who served as Hogan’s chief of staff for just over two months, was indicted on eight federal counts in connection with a severance payment he negotiated with the Maryland Environmental Service as well as $170,000 in questionable expenses.  His attorney, Joseph Murtha, in a motion filed in U.S. District Court said allowing prosecutors to note the related state charges or a critical legislative oversight report could harm McGrath’s chances of a fair trial. 

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“Without question, evidence of a parallel investigation resulting in an indictment in an independent sovereign, and a report prepared by a body politic, would unfairly prejudice Mr. McGrath,” Murtha wrote in his filing. “The admission of such evidence would place upon Mr. McGrath the heavy burden of defending himself against the allegations filed in state court, and gathered by the Maryland General Assembly, in the midst of federal prosecution. Moreover, evidence of another investigation (involving allegations beyond the scope of the federal prosecution) would serve to confuse the jury.”

Federal prosecutors have not responded to Murtha’s motion.

The federal indictment handed down last October stems from McGrath’s time as executive director of the quasi-public Maryland Environmental Service. Charges include four counts of wire fraud and two counts of misappropriation.

McGrath led the agency from December 2016 until May 31, 2020, when he resigned to become Hogan’s chief of staff. McGrath took over as Hogan’s top adviser the next day, earning a salary of more than $233,000.

McGrath’s expenses were also called into question by the report from the joint legislative panel, for both the amount as well as the benefit they provided to the agency.

In just three years at the helm of MES, McGrath was reimbursed for nearly $170,000 in expenses. His two immediate predecessors claimed nearly $16,000 and nearly 18,000, respectively. Both led the agency for more than decade each.

McGrath resigned on Aug. 17, 2020, after his severance package from MES became public.

According to the indictment, McGrath fraudulently secured a $233,647.23 severance payment from MES by falsely telling the board that Hogan had approved the payment. McGrath allegedly also filed false attendance reports with the agency during times when he was actually on vacation, according to the indictment, which covers alleged activities between March 2019 and December 2020.

Other charges include causing MES to pay a museum money that McGrath had pledged to donate and to pay $14,475 in tuition benefits for McGrath to attend a Harvard Kennedy School Executive Education program after he had left MES.

Additional charges filed in June allege McGrath faked a document he claimed proved the governor knew of and approved of the severance payment.

Hogan has repeatedly maintained he did not approve the compensation.

McGrath’s federal trial is scheduled to begin in about a month.

The disgraced former state official is also charged in state court stemming from a joint investigation between federal agents and the Office of the State Prosecutor.

McGrath faces more than two dozen state charges of illegally recording conversations between himself, Hogan and other top state officials as well as misconduct in office, embezzlement and theft.

All of the charges are tied to his time as head of the Maryland Environmental Service. Those charges were announced simultaneously with the federal case.

That trial is now scheduled for next spring.

“Although the United States and the State of Maryland may have joined forces in the course of their investigation it would be inappropriate for any government witness to offer evidence that there is a collateral prosecution of Mr. McGrath in the state of Maryland or that there is an 82-page report authored by the General Assembly Joint Committee on Fair Practices and State Personnel Oversight,” Murtha wrote.

The legislative report, issued in May after the federal indictment, urges the Maryland Environmental Service to sue McGrath for the money paid to the former director and one of his top aides. The report contains 1,600 pages of supporting records and documents accumulated by the committee during the course of its investigation of McGrath.

The report paints a damning portrait of McGrath as a manager whom subordinates described as aloof, hands-off, and “toxic. It also documents a number of actions the committee deemed an abuse of McGrath’s state position.

Murtha argues that the state charges and the legislative report should not be introduced to a jury in the federal trial.

“The fact that Mr. McGrath was the subject of an investigation by the Office of the State Prosecutor and that an indictment has been filed in the Circuit Court for Anne Arundel County is not relevant to the instant charges,” Murtha wrote. “Nor is the fact that a joint committee convened by the Maryland General Assembly conducted a separate investigation and authored an 82-page report.”