DALLAS - The FBI agent who headed up the John Wiley Price corruption investigation took the stand Tuesday for the second day of testimony in the county commissioner’s federal trial.
Now retired Agent Don Sherman recalled the day Price’s office was raided at Commissioner’s Court. He said Price’s assistant, Daphney Fain, voluntarily talked to him in 2011.
Federal agents were led to Price while investigating city Councilman Don Hill on corruption charges.
Kathy Nealy was the link to both men. While investigating Hill in 2006, Sherman testified he discovered tens of thousands, if not hundreds of thousands of dollars going from Nealy's bank accounts to accounts controlled by Price.
Sherman began a series of interviews with Nealy. With her bank records and Price's bank records side by side, he talked to Nealy about money to Price. Even after that, Nealy and Price continued their financial relationship.
Prosecutors said Fain lied about Price having any connection or reaping financial benefit from her side company, MMS Co.
Sherman asked Fain if Price had any control in her company. She told him no. She also said Price was not on any MMS bank accounts.
Prosecutor Walt Junker asked Sherman, “How certain are you that she said Price never benefited from MMS?”
Sherman replied, “I'm very certain of that."
An IRS agent testified about Price’s tax returns. In addition to fraud, Price is charged with four counts of tax evasion for not reporting all of his income. There were also some years where his electronic tax returns were not signed.
Agent Roman Hernandez said there was a significant amount of money from three women that Price did not report.
Those three women are Fain, Nealy and Karen Manning. Nealy will be tried separately, and Manning has already pleaded guilty to tax charges.
Under cross-examination, Hernadez admitted that borrowed money doesn’t need to be reported as income.
When Sherman was questioning Fain back in 2011 on the day search warrants were served, he already had banking records showing Price on the MMS checking accounts. That’s where the lying to the government charge against her came from.
All of what's happening now traces back to Kathy Nealy and the Don Hill case. In that case, Nealy was a witness for the government.
The federal trial is expected to last four months. The case involves volumes of evidence and may have been the FBI’s largest search warrant execution in Dallas history.