PANAMA CITY, Fla. (WMBB) — Federal prosecutors have responded to arguments from the two remaining defendants in the Lynn Haven corruption trial.

James Finch, the owner of Phoenix Construction, and Margo Anderson, the former mayor of Lynn Haven are accused of fraud and bribery in connection to several city projects both before and after Hurricane Michael. 

Six other individuals, including the former city manager, city attorney, and leisure services coordinator have pleaded guilty in the case. And, a former city commissioner, Antonious Barnes, pleaded guilty in a separate matter but, according to prosecutors, plans to testify that Finch bribed him. 

Finch and Anderson contend that prosecutors allowed an FBI agent to lie during testimony to the grand jury, that much of the facts presented by prosecutors are wrong, and that prosecutors have repeatedly failed to provide important evidence to the defendants that exonerate their clients.

They also said that an investigator on the case was “involved in deeply troubling corruption.” And they took aim at a prosecutor on the case by citing serious misconduct on a case from the 1990s and arguing that his actions during this investigation have been similarly unethical. 

They hope these arguments will be enough to get the entire case thrown out. 

In their response, prosecutors argue that none of these concerns are legally valid or are the basis for throwing out any count in the case, much less the entire case. 

First, they minimize the role and actions of the local investigator and the FBI agent. 

“This was clearly not knowingly false testimony,” prosecutors wrote. “It is mistaken testimony or some indication that the case agent overlooked something.” 

They describe the allegations against the local investigator as “unconfirmed, sometimes hearsay at one or more levels, and-or already disproven allegations of misconduct against a local law enforcement officer,” they wrote. They add that he, “was present for some interviews conducted by the FBI but was never expected to be a government witness in this case.”

They also state that “defendants have articulated no basis how any allegation of misconduct against (REDACTED) make it less likely that Defendant Finch paid bribes to Defendant Anderson, … or that Defendant Finch lied to the FBI about the Motorhome transaction.” 

The defense states that prosecutors violated Judge Mark Walker’s ruling by filing a grand conspiracy charge again even though Walker previously threw that charge out. Prosecutors say the new indictment does not try to prove a grand conspiracy. 

While arguing that the legal claims of the defense prosecutors reiterated their case against Finch and Anderson. 

“Defendant Anderson pressured City officials with respect to Defendant Finch’s projects (say, by steering $3.4 million of hurricane recovery business to him,” they wrote. “And overruled the city manager about the conduct of Defendant Finch’s projects, that Defendant Anderson took many benefits from Defendant Finch and they covering up the nature of the largest one (the motorhome).”

This was an expensive deal for the city, they added.

“The City could have sold the debris to the company across the street for approximately $500,000 just as Defendant Finch later did, and had Defendant Anderson not so intervened to benefit Defendant Finch, the taxpayers would have been $3.4 million better off,” they wrote. 

They claim that Finch and his legal team have lied several times as the case headed to trial, including about whether or not he would participate in a grand jury session, about his contact with Lynn Haven officials after he was ordered to stay away from them, and about whether or not he shared the discovery in the case with other individuals. 

Although it is redacted, a portion of the filing suggests that Finch or one of his attorneys gave discovery material to GAC Contractors and that the FBI found the material when they raided GAC offices in August of 2021.   

GAC has at times been connected to the corruption case but no charges have been filed against anyone who worked for or owned the company. 

The motorhome comes up again several times with prosecutors noting that Anderson was seen driving it around town and referred to it as “our” motorhome.  

This time prosecutors call into question payments Anderson and her husband made to Finch for the vehicle. 

“The Andersons paid Defendant Finch $20,000 by check (and perhaps $15,000 in cash withdrawn) 22 months after receiving the Motorhome and only after individuals were indicted in the related case and the FBI interviewed Defendant Anderson about her involvement with ECS,” they wrote. 

They added that money seems to have come from hurricane insurance settlements.

A hearing in the case is scheduled for late February.