‘You failed.’ Former Kentucky county official sentenced in federal fraud case

Photo submitted.

A former Kentucky prosecutor who sought one of the state’s highest offices before being accused of involvement in more than $600,000 in fraud has been sentenced to three years and six months in federal prison.

Michael T. Hogan, who was county attorney in Lawrence County more than 19 years, will also owe restitution. The amount has not been determined.

U.S. District Judge Gregory F. Van Tatenhove sentenced Hogan, 53, on Tuesday in federal court in Frankfort, ordering him to report to prison on Dec. 6.

Hogan admitted he overbilled the state for work to collect child support payments and directed his wife to write extra checks to herself from an account for delinquent property-tax collections.

Van Tatenhove put Hogan’s case in the context of a troubling cynicism about public officials in the country, asking who people could count on to respect the law if not the local prosecutor.

“The community needed you to do the right thing,” Van Tatenhove said. “You failed.”

Michael Hogan and his wife, Joy, pleaded guilty to conspiracy to commit wire fraud, and he pleaded guilty to an additional charge of theft from a government program.

Van Tatehove sentenced Joy Hogan to one year and one day in prison, directing her to report to prison Jan. 3.

‘Drained the account’

Michael Hogan took office as county attorney in 2003. His guilty plea last March required him to resign, and he said in court he has been disbarred.

Hogan also ran for lieutenant governor in the May 2019 Republican primary with then-state Rep. Robert Goforth at the top of the ticket.

The two took nearly 40% of the total vote, showing the vulnerability of the incumbent, Matt Bevin, who lost to Democrat Andy Beshear in the general election.

The FBI investigation of Hogan was rooted in a state audit released in May 2020 that found he had given improper bonuses to employees, mostly his wife.

Hogan and his wife set up an account to receive delinquent county property-tax payments, but had the payments routed to their home address and wrote dozens of checks to Joy Hogan totaling more than $365,000 in seven years, a federal indictment charged.

Helping collect delinquent taxes and child support are among a number of duties county attorneys perform in Kentucky, along with advising county governments on legal matters and prosecuting misdemeanor crimes and traffic violations.

Federal authorities said the Hogans used the money for mortgage and car payments, credit card bills and other expenses.

The prosecutor, Assistant U.S. Attorney Kate K. Smith, said in a sentencing memorandum that the the improper payments from the tax account to Joy Hogan totaled at least $379,458.

The most any other employee received in bonuses during the same period was about $10,000, according to the memo.

Mike Hogan also over-billed the taxpayer-supported program to collect child support by at least $232,127, for a total loss from the two schemes of $611,585, the memo said.

Employees in the child-support office couldn’t cash their checks at times because it didn’t have enough money, even as Hogan overbilled for his work “knowing his employees could not cash their own paychecks,” Smith said in the memo.

Hogan could have used money from the delinquent tax account to cover budget shortfalls in the child-support office, but that wasn’t an option “because he routinely drained the delinquent tax account to pay bonuses to Joy Hogan,” Smith wrote.

‘Stealing this money’

Defense attorneys Jarrod J. Beck and Michael B. Fox argued the government’s calculation of the amount of fraudulent payments was too high because work the Hogans did entitled them to at least some of the money included in the estimate.

Witnesses testified at the sentencing hearing that Joy Hogan routinely took stacks of work home with her, and that Michael Hogan worked outside office hours as well to handle matters such as search warrants for police.

However, a forensic accountant with the FBI said no witness indicated during the investigation that Joy Hogan did a significant amount of work outside the office.

People who had worked in Hogan’s office also estimated for the FBI that 95% or more of the time Hogan billed the state for doing child-support collections was fraudulent.

The prosecutor, Smith, argued in court that Michael and Joy Hogan knew the extra payments to her were not legitimate because they didn’t initially claim the income on tax returns.

“Not one of these checks is on their taxes. They were stealing this money,” Smith said.

Van Tatenhove overruled objections to the government’s calculation of the loss in the case, which added to the potential prison sentences.

Beck told Van Tatenhove that Hogan grew up poor but overcame difficult circumstances to become an attorney after service in the military.

Hogan was involved in civic causes and worked hard to fight drug abuse in his rural county and help people get treatment, Beck said.

“They’ve done a lot of good things for people,” he said of Michael and Joy Hogan.

Joy Hogan’s ex-husband said in a letter that he had never seen anything but kindness and helpfulness from her and Hogan, and other letter writers described Joy Hogan as sweet, selfless, compassionate, hard-working and a dedicated mother.

Her attorney said Joy Hogan only did what her husband, who was also her boss, instructed.

“If Joy Hogan had not been in this relationship, she would not be here today,” Fox said in court.

Van Tatenhove sentenced Joy Hogan to less time than outlined in advisory sentencing guidelines.

In an emotional statement, Michael Hogan apologized for his conduct, saying he had started drinking too much at one point. He begged Van Tatenhove to not send Joy Hogan to prison.

But Van Tatenhove said the crime required prison time for both of them. He also recommended that Michael Hogan take part in a substance-abuse treatment program in prison.

U.S. Attorney Carlton Shier IV said in a statement after the sentencing that Hogan “brazenly” broke the law at the expense of people who elected him.

“His conduct will leave lasting damage, both from the theft and from the resulting loss of faith in government officials and law enforcement,” Shier said. “His prosecution and sentence are the first steps in the effort to restore that faith.”